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MEETINGS CALLED TO ORDER.[PLEDGE OF ALLEGIANCE]
PLEDGE OF ALLEGIANCE WILL BE LED BY MATTHEW CRUZ INDIVISIBLE WITH LIBERTY AND JUSTICE FOR THANK YOU MATTHEW.[ROLL CALL]
GINA TO LEAD THE ROLL CALL PRESIDENT MCGUIRE.PRESENT VICE PRESIDENT SCOTT PRESENT.
COMMISSIONER SHANNON, COMMISSIONER RAIN IS ABSENT.
SECRETARY CORDERO AND COMMISSIONER RAINEY ARE EXCUSED FROM TODAY'S BOARD MEETING.
ARE THERE ANY OBJECTIONS FROM THE BOARD? SEEING NO OBJECTIONS FROM THE BOARD WILL
[1. 24-55737 Recommendation to approve November 21, 2024 Board meeting minutes. Suggested Action: Approve recommendation. ]
NOW MOVE ON TO THE REGULAR AGENDA.ITEM NUMBER ONE IS TO APPROVE NOVEMBER 21ST, 2024 BOARD MEETING MINUTES.
ARE THERE ANY PUBLIC COMMENTS? ANY COMMISSIONER COMMENT? DO I HAVE A MOTION? I MOVE.
DO I HAVE A SECOND? THANK YOU COMMISSIONER.
[2. 24-55738 Recommendation to authorize the General Manager to execute an agreement, including any necessary amendments, with Duncan, Weinberg, Genzer & Pembroke, P.C. for legal services in an annual amount not to exceed $100,000 for a period of three years, and to authorize the General Manager to exercise the option to renew for three additional one-year periods. Suggested Action: Approve recommendation. ]
ITEM NUMBER TWO, TO AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN AGREEMENT INCLUDING ANY NECESSARY AMENDMENTS WITH DUNCAN WEINBERG, GENZER AND PEMBROKE PC FOR LEGAL SERVICES.HOW'S EVERYONE? SO, UM, I'M GONNA GIVE MY PRESENTATION IN JUST A MINUTE, BUT I THOUGHT WE WOULD BEGIN THIS.
UM, YOU KNOW, THIS IS OUR SECOND TIME HERE PRESENTING, UH, THIS EXCELLENT LEGAL TEAM.
WE WERE LAST HERE ON SEPTEMBER 19TH, UM, AND THERE WAS A LOT OF ACTIVITY THAT DAY.
LISA GAS
UH, SO WE HELD THE ITEM OVER AGAIN UNTIL TODAY.
SO TO BEGIN THIS WITH, I WOULD LIKE TO INTRODUCE OUR CITY ATTORNEY, MARSHA YASUDA, WHO WILL GIVE A LITTLE BIT OF A BACKGROUND ON THE SELECTION PROCESS.
SO, JUST, UM, AS A LITTLE BIT OF BACKGROUND, UM, AT THE OCTOBER 12TH, 2003 UTILITY BOARD MEETING, UM, THE BOARD CONSIDERED AN ITEM TO INCREASE THE AMOUNT OF, UH, THE AGREEMENT WITH OUR CURRENT UTILITIES CPUC LEGAL COUNSEL.
AND DURING DISCUSSION OF THAT ITEM, THE QUESTION WAS RAISED AS TO WHETHER UTILITIES WAS RECEIVING THE BEST RATE FOR THESE LEGAL SERVICES.
SO THEN PRINCIPAL, DEPUTY CITY ATTORNEY RICH ANTHONY REACHED OUT TO FIVE OTHER LAW FIRMS THAT WERE KNOWN TO REPRESENT MUNICIPAL UTILITIES.
UM, WITH INFORMAL RFPS, A REQUEST FOR PROPOSALS, WE RECEIVED TWO RESPONSES.
UH, SO THE CITY ATTORNEY'S OFFICE THEN ALONG WITH STAFF, CONSIDERED THE TWO RESPONSES, UH, PROPOSALS ALONG WITH THE RATES AND SERVICES, UM, OF THE CURRENT CPUC COUNCIL.
AND AFTER REVIEWING ALL THE DOCUMENTATION, WE DETERMINED THAT DUNCAN WEINBERG GENZER PEMBROKE PC PROVIDED THE BEST RATES AND EXPERIENCED TO PROVIDE, UH, CP LEGAL REPRESENTATION MOVING FORWARD.
UH, AT THE SEPTEMBER 19TH, 2024 MEETING, STAFF RECOMMENDED AUTHORIZING THAT THE GENERAL MANAGER ENTER INTO AN AGREEMENT WITH DUNCAN WEINBERG GENZER PEMBROKE PC, WHICH I'LL BE REFERRING TO AS DWGP THROUGHOUT THE REST OF THE PRESENTATION FOR LEGAL SERVICES.
BUT AFTER SOME BOARD DISCUSSION, THE ITEM WAS LAID OVER.
SO STAFF REENGAGED WITH D-W-P-G-A GP TO ADDRESS THE BOARD'S CONCERNS AND WANTED TO ENSURE REPRESENTATIVES FROM THE BOARD, FROM THE FIRM, EXCUSE ME, WERE AVAILABLE TO ANSWER ANY BOARD QUESTIONS WHEN THE ITEM WAS BROUGHT BACK TO THE BOARD.
SO WE ARE TODAY BRINGING BACK THE ITEM WITH FULL PRESENTATION BY STAFF AND DWGP TO ADDRESS ANY BOARD CONCERNS.
SO, TONY, I WILL HAND IT OFF TO YOU NOW.
UH, AS MARSHA STATED PERIODIC REVIEW OF THIRD PARTY LEGAL CONTRACTS, PRUDENT PRACTICE TO ENSURE THE BEST REPRESENTATION IS RETAINED IN THIS CASE, THIS ENSURES THAT WE AS A GAS UTILITY AND OUR RATE PAYERS ARE WELL ADVISED AND ARE INTEREST ARTICULATED AND ADDRESSED ON AN ARRAY OF ISSUES BEFORE VARIOUS REGULATORY BODIES.
LAW FIRM OF DAVIS, WRIGHT AND TAIN HAS PREVIOUSLY WELL REPRESENTED THIS GAS UTILITY SINCE 2010.
COSTS OVER THE LAST SIX YEARS ARE PRESENTED HERE WITH FISCAL YEAR 23 COSTS
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REPRESENTED AS AN OUTLIER YEAR AS WE CONSULTED WITH DWT ON MULTIPLE ISSUES INVOLVING NOT ONLY THE JANUARY, 2023 GAS COMMODITY PRICE SPIKE, BUT ALSO ON FOUR YEAR, ON THE FOUR YEAR GENERAL RATE CASE AND COST ALLOCATION, BACKBONE, TRANSMISSION, TRANSMISSION RIGHTS, AND THE 30 YEAR GAS PREPAY AGREEMENT AMENDMENTS, ALL OF WHICH FELL IN THAT FISCAL YEAR.FISCAL YEAR 24, AS YOU CAN SEE, HAS, UH, CLOSED OUT AT A MORE MODEST FEE, EVEN UNDER OUR PROJECTIONS AT 80,735.
SO WHAT SERVICES WILL DWGP PERFORM? IN SHORT, THEY WILL ASSIST US AS NEEDED ON ANY LEGAL OR REGULATORY PROCEEDINGS THAT AFFECTS THE COST OF GAS AND THE MANNER IN WHICH WE PROCURE, TRANSPORT, STORE, AND DELIVER IT AND COMPLY WITH LOCAL STATE FEDERAL OVERSIGHT COMPLIANCE AND POLICY MATTERS.
THESE INCLUDE GENERAL RATE CASE PROCEEDING.
THIS IS THE PROCESS BY WHICH CALIFORNIA'S LARGE INVESTOR OWNED UTILITIES, INCLUDING NATURAL GAS, APPLY TO REQUEST INCREASES IN THEIR RATES BY DETERMINING, UH, BY DEMONSTRATING INCREASED COSTS, COST ALLOCATION PROCEEDINGS.
THIS IS THE PROCESS WHERE ONCE THE INCREASED COSTS ARE DETERMINED, REASONABLE PARTIES DEBATE THE DISTRIBUTION OF THESE COSTS ACROSS A SERIES OR ACROSS AN ARRAY, UH, OF TARIFFS, INCLUDING THE WHOLESALE, UH, CUSTOMER TARIFF, WHICH WE PARTICIPATE IN SUCH AS ANY MUNICIPAL GAS, UTILITY, GAS, RELIABILITY PLANNING.
UNDER THESE PROCEEDINGS, THE LARGE IOUS IN OUR CASE, SOCAL GAS, LAY OUT THEIR PLANS FOR THEIR PIPELINE INFRASTRUCTURE AND ESSENTIALLY OPEN UP A COMPETITIVE PROCESS WHEREBY THIRD PARTIES LIKE US, UH, BID FOR CAPACITY ON THAT INFRASTRUCTURE STORAGE PROCEEDING.
HERE, A SIMILAR PROCESS OCCURS FOR ACCESS TO INVESTOR-OWNED UTILITIES, STORAGE FACILITIES, AND CAPACITY ON THOSE FACILITIES FOR PARITY RESOLUTION.
HERE ARGUMENTS ARE MADE REGARDING FAIRNESS AND EQUITY AMONGST WHOLESALE CUSTOMERS.
FOR EXAMPLE, SHOULD LONG BEACH BE TREATED THE SAME AS AN ELECTRIC GENERATION UTILITY, UH, IN, IN FOR THE PURPOSES OF PROCURING GAS, UH, WHERE POWER PLANTS CAN MORE READILY PASS THROUGH INCREASED RATES.
LONG BEACH GAS HAS A PRIMARILY RESIDENTIAL COMMITTEE WHERE CUSTOMERS ARE LESS LIKELY TO ABSORB THOSE INCREASES AS EASILY WHILE MS. GAS AND HER TEAM WILL INTRODUCE THEMSELVES SHORTLY.
HERE ARE SOME GENERAL HIGHLIGHTS OF HER PRACTICE.
DWGP STARTED IN 1971, WASHINGTON DC UH, THERE IS A LOCAL DWGP OFFICE IN SACRAMENTO.
MR. NEIL IS BASED, MS. GAS AND HER TEAM WERE SELECTED FOR THEIR DECADES OF EXPERIENCE AND EXPERTISE IN ENERGY LAW AND PUBLIC UTILITY REGULATION, PARTICULARLY ON THE CONSUMER SIDE OF THE INDUSTRY, INCLUDING NATURAL GAS UTILITIES, MUNICIPAL, ELECTRIC, RURAL CO-OPS, AND THEIR UNDERSTANDING OF PUBLIC UTILITY COMMISSIONS.
THE TEAM CURRENTLY PROVIDES LEGAL REPRESENTATION FOR THE CITY OF PALO ALTO AND THE CITY OF VERNON, WHICH IS VERY IMPORTANT AS THOSE CITIES IN ADDITION TO LONG BEACH ARE CALIFORNIA'S ONLY THREE MAJOR MUNICIPALLY OWNED GAS UTILITIES.
TOGETHER WE CAN PROVIDE A STRONG AND UNIFIED VOICE TO STATE REGULATORS WHO OVERSEE INVESTOR OWNED UTILITIES TO ENSURE FAIRNESS.
IN FACT, MS. GAS HAS ALREADY SUCCESSFULLY LED A CONSORTIUM OF CALIFORNIA MUNICIPAL GAS UTILITIES, INCLUDING LONG BEACH PROCEEDINGS BEFORE THE PUC AND THE CALIFORNIA ENERGY COMMISSION.
MARSHA, UH, JUST PREVIOUSLY SPOKE ABOUT THE VENDOR PROCESS, BUT TO RECALL BY FIRMS EXPRESSED INTEREST REPRESENTING LONG BEACH CAREFUL REVIEW, EWGP WAS SELECTED.
THIS CONTRACT IS NOT TO EXCEED $100,000 ANNUALLY, THE TERM IS FOR THE NEXT THREE YEARS, AND IT IS ALREADY BUDGETED OUT IN OUR GAS GRANT.
SO THESE NEXT FEW SLIDES PRESENT HOW OUR NATURAL GAS PROCUREMENT AND CONTRACTED LEGAL LEGAL SERVICES WORK TOGETHER.
AS YOU MAY RECALL, 70% OF OUR GAS IS, IS PROCURED UNDER A PREPAID CONTRACT.
THIS GRAPHIC SHOWS THAT THIS PREPAID GAS IS SOURCED OUT OF STATE TRANSPORTED TO RECEIPT POINTS OF THE CALIFORNIA BORDER.
IT'S IMPORTANT TO NOTE THAT THESE RECEIPT POINTS ARE COMPETITIVELY SOUGHT
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AND THEY EACH REPRESENT DIFFERENT COSTS AND THROUGHPUT FIGURES.COMMODITY PRICES FLUCTUATE DAILY, OFTEN GREATLY.
SO IT IS CRITICAL TO WORK WITH STATE REGULATORS AND THE IOUS TO ENSURE THE BEST AVAILABLE RIGHT LIABILITY AND COST EFFICIENCIES.
THIS OCCURS THROUGH A REGULATED PROCESS CALLED THE BACKBONE TRANSPORTATION SERVICE PROCESS, AMONG OTHERS, UH, IN WHICH THE PUC OVERSEES COP AND ACCIDENT.
SO, OH, WE CAN GO BACK THE PREVIOUS SLIDE.
SO YOU CAN SEE THESE VARIOUS RECEIPT POINTS.
UM, WE CALL 'EM BORDER RECEIPT POINTS, BUT SOMETIMES THEY'RE A LITTLE BIT FURTHER INLAND AND EVERYONE IS GOING FOR THE CHEAPEST PRICE AND THE GREATEST THROUGHPUT BECAUSE THE SOCAL SYSTEM OFTEN HAS CURTAILMENT ISSUES WHERE FOR SOME REASON A PIPELINE, UH, NEEDS MAINTENANCE OR HAS SOME SORT OF UNPLANNED OUTAGE.
SO IT'S IMPORTANT THAT WE WORK TOGETHER WITH OUR ATTORNEYS REPRESENTED BEFORE THE REGULATORY AGENCIES TO MAKE SURE THAT ACCESS OF THESE MORE COMPETITIVE POINTS ARE MADE AVAILABLE TO LONG BEACH TO ENSURE THE BEST RATES FOR OUR CUSTOMER.
STORAGE IS ANOTHER KEY COMPONENT OF OUR OPERATION.
THIS GRAPH SHOWS OUR CYCLICAL PATTERN OF INJECTIONS AND WITHDRAWAL FROM STORAGE AS A KEY MECHANISM TO MITIGATE VOLATILITY IN SUPPLY AND PRICING.
GENERALLY, WE INJECT GAS IN THE WARMER SUMMER AND SPRING MONTHS.
WHEN DEMAND IS LOW, PRICING IS CHEAPER, THEN THE COOLER FALL AND WINTER MONTHS STRATEGICALLY WITHDRAW.
THIS CHEAPER GAS AND DEMAND AND PRICING ARE HIGHER.
THAT BIG DRAWDOWN YOU SEE HERE IS JANUARY, 2023 WHEN WE ESSENTIALLY DEPLETED OUR STORED GAS TO DELIVER AS MUCH CHEAPER GAS AS WE COULD TO EASE PRICE BURDENS ON OUR CUSTOMERS.
AS MARKET PRICES SKYROCKET TO EXCEED $46 A
LEGAL REPRESENTATION IS NECESSARY TO HELP US EMPHASIZE THE IMPORTANCE OF STORAGE.
STATE REGULATORS SOMETIMES PROPOSED TO REDUCE OR ELIMINATE SOME STORAGE FACILITY.
THIS LAST SLIDE REPRESENTS A DIFFERENT VIEW OF A COMMON THEME.
COMMODITY PRICING IS VOLATILE.
IT RISES AND FALLS BASED ON MANY SUPPLY AND DEMAND FACTORS, INCLUDING WEATHER, TRANSPORT COSTS, PIPELINE OUTAGES, PRODUCTION LEVELS, REGULATORY SHIFTS, AND POLITICAL AND ECONOMIC CONDITIONS.
IN JANUARY 23, UM, CRISIS FEATURED PROMINENTLY THIS GRAPH AND AS AN EXAMPLE OF THE EXTREME VOLATILITY RESULTING FROM A CONFLUENCE OF FACTORS EXPERIENCE LEGAL COUNSEL IS ABSOLUTELY ESSENTIAL REPRESENTING LONG BEACH BEFORE VARIOUS REGULATORY BODIES THAT OVERSEE MANY OF THESE VALUES.
WHILE LONG BEACH GAS CUSTOMERS ARE THE BEST PROTECTED CUSTOMERS IN THE STATE WITH THE LOWEST NATURAL GAS RATES THIS MONTH.
BUT, UH, WE MUST ALWAYS REMAIN AHEAD OF THE CURVE.
SO NOW I WOULD LIKE TO INTRODUCE MS. GAST TO THE PODIUM TO INTRODUCE HERSELF AND HER TEAM.
MORNING, UH, MY NAME'S LISA GAST.
I'M WITH DUNCAN WEINBERG ZER IN PEMBROKE.
UH, AND I'LL GO WITH DWGP AS WELL.
UM, WE STARTED IN 1971 AS TONY INDICATED, AND, YOU KNOW, BACK IN THOSE DAYS, THE LONGER THE FIRM NAME, THE MORE IMPORTANT YOU ARE.
SO, UM, THEY JUST KEPT ADDING NAMES 'CAUSE THE PARTNERS BACK THEN DECIDED IF YOUR NAME WASN'T ON THE DOOR, YOU MUST NOT BE ALL THAT IMPORTANT.
UM, BUT WE PRIMARILY GO BY DWGP THESE DAYS.
UM, I'VE BEEN WITH THE FIRM FOR 27 YEARS.
UM, I'VE BEEN WITH THE FIRM MY ENTIRE LEGAL CAREER, UM, AND I'VE STAYED WITH THE FIRM FOR A NUMBER OF REASONS, THE BIGGEST OF WHICH IS OUR MISSION AND OUR CLIENT BASE.
UM, WE REPRESENT PUBLIC POWER, SO THE MUNICIPAL ELECTRIC UTILITIES AND THE MUNICIPAL AND THE MUNICIPALLY OWNED GAS UTILITIES.
YOU KNOW, WE DO SOME HYDRO WORK, WE DO SOME OTHER THINGS, BUT OUR FOCUS IS REALLY ON, UM, PROVIDING LOWEST COST,
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RELIABLE SERVICE TO CUSTOMERS.AND SO WE DON'T REPRESENT INVESTOR OWNED UTILITIES.
WE REALLY STICK IN OUR LANE, WHICH IS YOUR LANE.
UM, SO WE'RE, WE'RE VERY EXCITED TO, TO HAVE THE PROSPECT OF WORKING WITH THE CITY OF LONG BEACH'S GAS UTILITY.
UM, YOU KNOW, GOING FORWARD, UM, AS TONY MENTIONED EARLIER, AND HE DID A TERRIFIC JOB OF, UH, EXPLAINING WHAT WE DO.
UM, WE ALSO REPRESENT, UH, THE CITY OF VERNON AND THE CITY OF PALO ALTO, UM, FOR THEIR, UH, GAS AND THEIR ELECTRIC UTILITY, UM, REGULATORY MATTERS.
UM, WE STARTED WORKING FOR THE CITY OF PALO ALTO AT LEAST I HAVE, I THINK IT WAS IN 2005, UM, MOSTLY ON THE ELECTRIC SIDE.
BUT IN 2021 WHEN THE, UH, BERKELEY CASE CAME OUT IN NORTHERN CALIFORNIA WHERE, UM, CITY OF BERKELEY WAS LOOKING TO ELECTRIFY THEIR, THEIR ENTIRE, UH, CITY AND GET RID OF ALL NATURAL GAS, CERTAINLY EVERYBODY WAS FOLLOWING THAT.
UH, AND CERTAINLY EVERYBODY IN THE NATURAL GAS INDUSTRY WAS, WAS FOLLOWING THAT IN CALIFORNIA.
UM, PALO ALTO BEING BERKELEY'S NEIGHBOR, UM, WAS OUT FRONT IN KIND OF FOLLOWING WHAT WAS GOING ON WITH BERKELEY TO SEE WHETHER THAT WAS GONNA MOVE FORWARD.
UM, SO THEY ASKED US, UH, TO HELP THEM IN THAT EFFORT IN TRYING TO, YOU KNOW, FOLLOW THE CASE, UM, SEE WHAT WAS GOING TO HAPPEN AND THEN, YOU KNOW, ADVISE PALO ALTO IN TERMS OF WHAT, UM, THEY MIGHT DO TO, UH, PREPARE THEMSELVES FOR POTENTIAL ELECTRIFICATION.
UM, I'VE ALSO BEEN REPRESENTING THE CITY OF VERNON SINCE 2021.
UM, WE REALLY STARTED WITH THE CITY OF VERNON TO HELP THEM GET OUT OF THE CALIFORNIA INDEPENDENT SYSTEM OPERATOR.
UM, THEY WERE A PARTICIPATING TRANSMISSION OWNER ON THE ELECTRIC SIDE WITH THE CAL ISO AND DECIDED THAT THEIR, UM, CONTRACTS WITH L-A-D-W-P AND WITH SCE, UH, SOCAL GAS'S ELECTRIC SIDE COMPANY, UM, WERE NO LONGER OF, OF ECONOMIC VALUE TO THEM.
SO WE WERE ABLE TO SUCCESSFULLY EXTRICATE, UH, CITY OF VERNON FROM THE CALIFORNIA ISO AS A PARTICIPATING TRANSMISSION OWNER.
UM, ALSO IN, UH, 2022, AS TONY WAS INDICATING EARLIER, UM, HAVING WORKED WITH PALO ALTO AND THE CITY OF VERNON, UM, ON ELECTRIC AND SOME NATURAL GAS MATTERS, WHEN THE CPUC UH, UH, BEGAN REQUESTING THAT THE, THE MUNICIPAL, UH, GAS UTILITIES PARTICIPATE IN SOME EFFORTS AT THE CPUC REGARDING THE REDUCTION OF AND THE DECOMMISSIONING OF CERTAIN GAS UTIL, UH, CERTAIN GAS FACILITIES, I IMMEDIATELY REACHED OUT TO RICH ANTHONY, UH, YOUR FORMER DEPUTY CITY ATTORNEY TO FIND OUT WHETHER LONG BEACH, UH, KNEW ABOUT THE CASE WAS GOING TO PARTICIPATE IN THE CASE, AND WHETHER WE COULD WORK TOGETHER, UM, AS THE THREE, THE, AS THE ONLY THREE MUNICIPAL GAS UTILITIES, UH, IN CALIFORNIA TO ENSURE THAT, YOU KNOW, THERE WAS NO JURISDICTIONAL CREEP AND THAT THE CPUC WASN'T GOING TO DO SOME KIND OF OVERREACH INTO THE MUNICIPAL, UH, GAS UTILITIES SOVEREIGNTY.
UM, WE WERE SUCCESSFUL IN THAT EFFORT.
UM, THERE ARE STILL EFFORTS GOING ON AT THE, AT THE CPUC REGARDING KIND OF THE ELECTRIFICATION OF CALIFORNIA AND THE DECOMMISSIONING OF CERTAIN NATURAL GAS FACILITIES.
UM, WE CONTINUE TO DO WORK FOR PALO ALTO AND VERNON IN THAT REGARD.
AND, AND HOPEFULLY WITH THE, WITH THE BOARD'S BLESSING, IF OUR, UM, IF OUR CONTRACT GOES THROUGH TODAY, WE'LL BE ABLE TO, UH, CONSOLIDATE ALL THREE OF, UH, MUNICIPAL NATURAL GAS UTILITIES IN THE EFFORT TO ENSURE THAT, THAT OUR RIGHTS AS MUNICIPAL SOVEREIGN GAS UTILITIES ARE PROTECTED.
UM, SO THAT'S KIND JUST A LITTLE BIT ABOUT ME AND, AND THE KINDS OF THINGS THAT I DO.
I'VE GOT WITH ME HERE, UH, SEAN NEAL FROM MY SACRAMENTO OFFICE, UM, WHO IS BOOTS ON THE GROUND AND ABLE TO ATTEND ANY C-P-U-C-C-E-C, ET CETERA, ALPHABET SOUP, UM, MEETINGS THAT MIGHT OCCUR.
AND I'VE ALSO GOT WITH ME, UH, SUSIE BERLIN FROM THE LAW OFFICES OF SUSIE BERLIN.
UM, SHE IS, UH, ASSUMING THIS CONTRACT GOES THROUGH TODAY, WILL BE WORKING UNDER MY CONTRACT, UM, SO AS A, AS A PASS THROUGH AGREEMENT.
AND SHE'S GOT SPECIFIC EX EXPERIENCE, UM, WITH THE, UH, NATURAL GAS RATE CASES IN NORTHERN CALIFORNIA THAT WILL BE EXTREMELY RELEVANT TO WHAT'S GOING ON HERE IN, UH, SOCALGAS TERRITORY.
AND I'LL LET SUSIE INTRODUCE HERSELF AND A LITTLE BIT MORE ABOUT WHAT SHE DOES.
AND, UM, MY BACKGROUND IS VERY SIMILAR TO LISA'S, EXCEPT I'VE ALWAYS BEEN IN, IN CALIFORNIA REPRESENTING PUBLICLY OWNED UTILITIES, PRIMARILY ON THE ELECTRIC SIDE, BUT ALSO DOING WORK THAT PERTAINS TO THE ENERGY AGENCIES NATURAL GAS, UH, MANDATES AND REGULATIONS.
AND FOR EXAMPLE, THAT INCLUDES WORK AT THE AIR RESOURCES BOARD TO ENSURE
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THAT THE UTILITIES, GAS AND ELECTRIC ARE ALLOCATED ALLOWANCES UNDER THE CAPITAL TRADE PROGRAM, MONITORING PROCEEDINGS, THE SCOPING PLAN, FOR EXAMPLE, THAT HAS IMPACTS ON THE UTILITIES AND AT THE CALIFORNIA ENERGY COMMISSION WHERE THEY'RE REVIEWING DECOMMISSIONING OF GAS FACILITIES.AND, UH, THE MOVE TOWARDS ENERGIZATION I, UM, FROM A GAS UTILITY PERSPECTIVE OF SOME VERY IMPORTANT ELEMENTS THAT ARE GOING TO BE INTRA-AGENCY AND NEED TO BE TRACKED ACROSS THE CPUC, WHICH, WHERE THERE'S REGULATION AND ALSO WITH THE AIR RESOURCES BOARD AND THE CALIFORNIA ENERGY COMMISSION IS THIS MOVE TOWARDS DECARBONIZATION AND THE SHIFT TO GREATER ELECTRIFICATION.
AND THAT'S AN AREA THAT I'VE WORKED IN EXTENSIVELY AND ALSO PROVIDE A LOT OF, UH, POLICY EXPERTISE AND GUIDANCE IN THAT AREA.
UH, STORAGE DECOMMISSIONING OF THE LINES LOOK AT HOW THESE CHANGES THAT THE REGULATORY AGENCIES WANT TO IMPOSE WILL IMPACT THE MUNICIPAL UTILITIES.
AND AS LISA MENTIONED, ENSURING THAT WE RETAIN OUR SOVEREIGNTY IN THE, THIS TRANSITION, BUT ALSO HAVE A VOICE IN WHAT IS BEING DONE TO INFRASTRUCTURE THAT IS GOING TO IMPACT US AS WE MOVE TOWARDS GREATER ELECTRIFICATION.
WE NEED TO ENSURE THAT IT'S AN EQUITABLE TRANSITION, WHICH MEANS THAT EVEN FOR THOSE OF US THAT ARE IN SUPPORT OF MOVING TOWARDS A GREENER ECONOMY, THAT WE'RE NOT, UH, IN A PLACE WHERE WE'RE STRANDING COSTS ON CUSTOMERS THAT ARE LEAST LIKELY ABLE TO AFFORD THOSE COSTS AND ENSURE THAT THIS TRANSITION IS, UH, TAKES INTO ACCOUNT AFFORDABILITY OF NATURAL GAS AND ELECTRICITY AS WE TRANSFER OVER.
UM, SO MY, UH, MY EXPERTISE AND EXPERIENCE VERY SIMILAR TO LISA'S, EXCEPT I DO MORE IN THE, UH, CALIFORNIA ARENA AND, UH, ACTIVELY IN THE CPUC PROCEEDINGS THAT ARE BROUGHT BY THE UTILITIES WHERE THEY'RE TRYING TO, AS TONY MENTIONED, GET THEIR REVENUE REQUIREMENT FOR THE YEAR AND THEN HOW THAT REVENUE REQUIREMENT IS ALLOCATED ACROSS THE DIFFERENT CUSTOMER CLASSES DEPENDING ON WHAT THE INCREASES ARE.
I'M GONNA CLOSE THIS OUT WITH A LITTLE LEVITY.
IF WE COULD GO BACK TO THAT, THAT PREVIOUS SLIDE.
YOU KNOW, AS WE LOOK AT GRAPHS OF VARIOUS COSTS OR FACTORS IN THE ENERGY SECTOR, THE SHAPES BEGIN TO TAKE ON IMAGE LIKE FORMS. AND SO AS WE TALK ABOUT, YOU KNOW, ELECTRIFICATION, RENEWABLES, SOMETHING CALLED A DUCK CURVE, WHEREAS POWER IS GENERATED DURING THE DAY, FORMS THIS NICE DUCK SHAPED CURVE, AND THEN IT'S A DWINDLES IN THE EVENING WHEN SOLAR GOES DOWN, IT REALLY IMA, IT HAS AN IMAGE OF THE DUCK'S BACK.
IF I LOOK AT THIS AND THAT NASTY SPIKE IN JANUARY 23, IT SUGGESTS TO ME ANOTHER BIRD IMAGE, PERHAPS
UM, BUT THIS IS WHY WE ENGAGE WITH THESE ATTORNEYS.
THIS IS WHY WE DO WHAT WE DO, TRY TO MITIGATE PRESENTATIONS AND, UH, THE VOLATILITY AND BURDEN ON OUR CUSTOMERS THAT, WITH THAT, GO TO THE LAST SLIDE.
UM, THIS AGAIN IS TO, UH, ASK YOUR APPROVAL TO ENTER INTO A CONTRACT WITH LISA GAST AND HER TEAM NOT TO EXCEED A HUNDRED THOUSAND DOLLARS ANNUALLY.
AND IT'S FOUR TERM OF THREE YEARS THAT I CONCLUDE MY PRESENTATION AVAILABLE FOR ANY QUESTIONS.
THANK YOU TONY, MARSHA, LISA, AND THE DWGP TEAM.
THANK YOU FOR THIS PRESENTATION.
IS THERE ANY PUBLIC COMMENT, COMMISSIONER COMMENT? LOOKS LIKE WE'RE GOOD TO GO.
UM, DO I HAVE A MOTION TO APPROVE? DO I HAVE A SECOND? THANK YOU.
ANY OPPOSED? SEEING NO OPPOSE.
[3. 24-55739 Recommendation to adopt Specifications UD-25-214 and authorize the General Manager to execute all documents necessary to enter into an agreement, including any necessary subsequent amendments, with All American Asphalt to provide street repair services in an amount not to exceed $5,500,000 for a period of one year, and to authorize the General Manager to exercise the option to renew for two additional one-year periods, with each renewal year subject to a not-to-exceed amount of $660,000, for a total contract amount not to exceed $6,820,000. Suggested Action: Approve recommendation. ]
ADOPT SPECIFICATIONS UD 25 DASH TWO 14 AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE AND AGREEMENT WITH ALL AMERICAN ASPHALT TO PROVIDE STREET REPAIR SERVICES.[00:25:01]
I'LL CALL ON TYINGUM, ORIGINALLY MIKE WAS SUPPOSED TO GIVE THIS PRESENTATION, SO I'M GONNA PINCH IT FOR HIM BECAUSE HE DOES HAVE A FAMILY EMERGENCY TO DEAL WITH.
UM, SO FOR THIS AGENDA ITEM, I DO HAVE A QUICK PRESENTATION.
FIRST I WANNA GO THROUGH WHAT IS STREET REPAIR SERVICES SERVICES THAT WE EXECUTE OR DAILY EMERGENCY WORK OUT IN THE FIELD.
UM, THIS THIS WORK FOR WHERE WE REQUIRE EXCAVATION.
SO YOU CAN SEE US WHERE WE HAVE TO ASK A CONTRACTOR, COME OUT WITH A STINGER AND BREAK UP THE ASPHALT AND CONCRETE UNDERNEATH THIS ASPHALT, UM, AS WELL AS BACKFILLS AND, UM, DELETING AREAS OF, UH, PROJECT RESTORATION.
SO MORE SPECIFICALLY, SOME EXAMPLE OF SERVICES IS ASPHALT REPAIR, CONCRETE BRICK PAVERS, UM, REPLACING METER BOXES, METER VAULTS, MANHOLE REPAIRS, UM, STRIPPING, UH, STRIP STREET STRIPPING AND STOP SIGNS, TRAFFIC LANES AND CROSSWALKS.
UM, HERE'S AN IMAGE OF THE MORE RECENT WORK THAT WE DID ON ORANGE.
UM, SO THIS IS THE REALLY NICE PATCH OF CONCRETE REPAIR THAT, UH, COMMISSIONER SHANNON WAS, WAS REALLY HAPPY TO DRIVE OVER ON ORANGE BOULEVARD
SO A LITTLE BACKGROUND ON THE ACTUAL BID ITSELF.
THE BID WAS POSTED ON OCTOBER 18TH, UM, AND THE BID OPENED ON NOVEMBER 11TH.
UNFORTUNATELY, WE ONLY RECEIVED ONE BID AND THAT WAS ALL AMERICAN ASPHALT.
WE DID LOOK AT, UM, HOW MANY PEOPLE, UM, DOWNLOADED THE, THE, THE ADVERTISEMENT AND REACHED OUT TO SOME OF THE VENDORS THAT WE HAVE WORKED WITH IN THE PAST AS TO WHY THEY DID NOT BID.
UM, WE REACHED OUT TO SULLY MILLER, WHICH HAS DONE A LOT OF WORK FOR US, AND THEY JUST SAID THAT THEY WERE SIMPLY TOO BUSY.
UM, THEY WOULD LIKE TO SEE THE BID RESULTS SO THAT IN THE FUTURE THEY CAN, YOU KNOW, BE COMPETITIVE AND BID IN THE FUTURE, BUT THEY JUST WEREN'T AVAILABLE.
UM, EXCEL PAVING, WHICH WAS ACTUALLY A LOCAL PAVING COMPANY, THEY ACTUALLY INDICATED THAT, UH, THEY WOULDN'T BE COMPETITIVE, UH, FOR THIS SIZE OF A JOB.
UM, AND, UH, AND THEN A COUPLE OTHER ONES.
ONE JUST SAID THAT, UM, THEY DECIDED NOT TO BID.
AND THEN THE LAST ONE, UM, GRANTED PAVING, THEY SAID THAT THEY'RE UPSET WITH THE CITY, SO THEY DECIDED NOT TO BID.
SO I DON'T REALLY KNOW WHY WE'VE NEVER DONE ANY WORK WITH
SO THAT'S KIND OF THE, UM, BACKGROUND AS TO SOME OF THE OTHER VENDORS AND WHY THEY DID NOT BID.
UM, WE ONLY RECEIVE ONE BID FROM ALL AMERICAN ASPHALT AND THEY ARE OUR CURRENT, UM, STREET REPAIR SERVICES VENDOR AND THEY'RE ALSO THE CITY'S, UM, STREET REPAIR SERVICES VENDORS.
SO THEY'RE PRETTY BIG AND THEY DO REALLY GOOD WORK.
UM, IN TERMS OF BID TABULATIONS, UM, THE WAY WE WE DO THE BID ANALYSIS IS WE DIVIDE THE, UM, PROJECTS INTO CATEGORIES.
SO LAST YEAR WE DID 1100 PAVING JOBS RANGING FROM SMALL PROJECTS LIKE, UM, JUST SMALL WATER AND GAS SERVICE INSTALLATIONS AND METER BOXES AND SIDEWALKS TO SUPER LARGE PROJECTS LIKE MAINLINE REPLACEMENT PROJECTS AND LARGE MAIN BREAK REPLACEMENT.
SO WE BREAK IT INTO, UM, SEVERAL CATEGORIES.
UM, OUT OF THOSE 1100 JOBS THAT WE, UM, PERFORMED LAST YEAR AND FROM THERE, UM, ABOUT 73% FALL IN THE SMALL CATEGORY, 21% FALL IN THE MEDIUM, FOUR AND 2%, UM, FOR THE LARGE AND EXTRA LARGE CATEGORIES, WHAT WE DID WAS THERE WERE A LITTLE OVER 650 LINE ITEMS IN THE BID RANGING FROM HOW TO PUT DOWN FOUR INCH PCC, UM, OR FOUR INCH ASPHALT.
AND WITHIN THAT, UM, THERE ARE SUBLINE ITEMS, AS IN, IF IT'S A SQUARE FOOTAGE, IS THIS SQUARE FOOT IS THIS PRICE.
AND SO YOU GET VOLUME DISCOUNTS AS YOU GET INTO A LARGER SQUARE FOOTAGE.
SO THERE'S 600 AND SOME LINE ITEMS. AND SO FROM THE SMALL JOBS THAT WE DID IN THE PAST YEAR, WE TOOK 40 EXAMPLE JOBS AND THEN APPLIED THE ACTUAL BID LINE ITEM PRICING TO THOSE 40 JOBS AND ESTIMATED WHAT THE COST WOULD BE FOR THAT JOB IF WE USED THE CURRENT PRICING.
AND WITH THOSE 40 SMALL JOBS, THE AVERAGE WAS $2,461, UM, OF THOSE 40 JOBS.
AND THEN WHEN WE TAKE THE AVERAGE COST PER JOB AND THEN MULTIPLY IT AGAINST 1100 JOBS TIMES 73%, THIS IS THE WEIGHTED COST.
AND SO WHEN WE DO THAT FOR ALL FOUR CATEGORIES, WE COME OUT WITH A BID TOTAL OF $5.6 MILLION.
SO THIS IS HOW WE, UM, CALCULATE OUR, OUR POSSIBLE EXPENDITURES FOR THE NEXT FISCAL YEAR.
UM, AND THEN WITHIN THE BID DOCUMENT WE ASK FOR WHAT IS THE, UM, PRICE INCREASE AS THEY FORECAST IN COMMODITY PRICE INCREASES.
AND THEY INDICATED 12% INCREASE IN PRICE, UM, FOLLOWING.
SO WITH THAT, UM, STAFF RECOMMENDS THE BOARD TO ADOPT SPECIFICATION UD 2 5 2 14 AND AUTHORIZE GENERAL MANAGER TO EXECUTE ALL DOCUMENTS
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NECESSARY TO ENTER INTO AN AGREEMENT, INCLUDING ALL NECESSARY SUBSEQUENT AMENDMENTS WITH ALL AMERICAN ASPHALT TO PROVIDE STREET REPAIR SERVICES IN AN AMOUNT NOT TO EXCEED $5.5 MILLION FOR A PERIOD ONE YEAR.AND AUTHORIZED GENERAL MANAGER TO EXERCISE THE OPTION TO RENEW FOR TWO ADDITIONAL ONE YEAR PERIODS WITH EACH RENEW PERIOD SUBJECT TO A NOT TO EXCEED AMOUNT OF 660,000 OR TOTAL CONTRACT AMOUNT NOT TO EXCEED $6.82 MILLION.
WITH THAT, I'D BE HAPPY TO ANSWER ANY QUESTIONS.
I APPRECIATE ESPECIALLY THE CALCULATION MODEL.
IT'S GREAT TO SEE WHERE THOSE NUMBERS COME FROM.
UH, IS THERE ANY PUBLIC COMMENT? ANY COMMISSIONER COMMENT? I HAVE A MOTION TO APPROVE.
THANK YOU, COMMISSIONER SHANNON.
[4. 24-55740 Recommendation to adopt Request for Proposal (RFP) EO-3687 and award an agreement with Stantec Consulting Services Inc., a New York corporation, to provide engineering design services for the Groundwater Treatment Plant Booster Pump Station Rehabilitation Project (EO-3687), in an amount not to exceed $1,125,846; and authorize the General Manager to execute all documents necessary to enter into the agreement, including any necessary subsequent amendments. Suggested Action: Approve recommendation. ]
TO ADOPT A REQUEST FOR A PROPOSAL EO 36 87 AND AWARD AN AGREEMENT WITH SAN STANTECH CONSULTING SERVICES IN NEW YORK CORPORATION TO PROVIDE ENGINEERING DESIGN SERVICES FOR THE GROUNDWATER TREATMENT PLANT BOOSTER PUMP STATION REHABILITATION PROJECT.AND I CALL ON CAROLINA EVAN DONNO.
I NEED YOU COMMISSIONER SHANNON
UM, AS, AS YOU MENTIONED, MY NAME IS CATALINA ANO AND I'M PART OF THE ENGINEERING BUREAU UNDER THE PIPELINE INFRASTRUCTURE GROUP.
SO I WILL BE PRESENTING TODAY THE GROUNDWATER TREATMENT PLAN BOOSTER STATION, UM, REHABILITATION PROJECT, AND A LITTLE BIT OF BACKGROUND ON THIS, UM, LONG BEACH.
UM, LONG BEACH GROUNDWATER TREATMENT PLAN WAS CONSTRUCTED IN 1997 WITH THE DESIGN CAPACITY OF 62.5 MILLION GALLONS PER DAY.
LONG BEACH UTILITIES DEPARTMENT PROVIDES POTABLE WATER SERVICES TO A POPULATION OF NEARLY 500,000 PEOPLE IN A 52 SQUARE MILE AREA IN LONG BEACH.
WOULD YOU ADVANCE THIS SLIDE, PLEASE? I'M SORRY.
UM, UM, LBUD MEETS PORTABLE WATER DEMAND THROUGH A COMBINATION OF PURCHASE TREATED SURFACE WATER FROM METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA AND LOCAL GROUNDWATER FROM WELLS TREATED AT THE GROUNDWATER TREATMENT.
OUR CURRENTLY, UM, AVERAGE PRODUCING AMOUNT IS, UM, 30 MGD A GROUNDWATER, UM, TREATMENT PLAN.
IMPROVEMENT MASTER PLAN WAS DEVELOPED IN 2023 THAT ASSESS EFFECTIVENESS OF TREATMENT PROCESS, CONDITION OF EXISTING FACILITY ASSETS, SEISMIC REQUIREMENT OF EXISTING STRUCTURES AND ADEQUACY OF THE EXISTING ELECTRICAL SYSTEM.
OUT OF THIS, UH, MASTER PLAN A SIX, UM, CIP PROJECTS, SIX CIP PROJECTS WERE IDENTIFIED FOR THE GROUNDWATER TREATMENT PLANT TO MAINTAIN AND IMPROVE IT ITS OPERATIONS.
ONE OF THE MAJORS IMP ONE OF THE MAJOR IMPROVEMENTS RECOMMENDED WAS THE REHABILITATION OF GROUNDWATER TREATMENT PLANT BOOSTER PUMP STATION.
AND THIS IS THE ONE THAT WE'RE PRESENTING ON TODAY.
AND THIS EXHIBIT, YOU'LL SEE THE OVERALL, UM, PICTURE OF, UM, THE GROUNDWATER TREATMENT PLAN.
AND HERE, UM, THIS IS WHERE THE BOOSTER PUMP STATION IS LOCATED.
YOU CAN SEE THAT THERE'S, UM, TWO TRAINS HERE.
THE FIRST ONE HAS FOUR PUMPS AND THE SECOND TRAIN HAS, UM, SEVEN PUMPS.
AND WE WILL ALSO BE, UM, WORKING WITHIN THE, UM, UM, SWITCH, UM, THE ELECTRICAL BUILDING HERE, AND THAT'S RIGHT NEXT TO HERE, THE GREEN BUILDING HERE.
UM, AS YOU MAY ALREADY KNOW, UM, THE PUMPS, UM, THE PUMP STATION THAT WE HAVE AT THE TREATMENT PLAN, UM, USUALLY
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PROVIDE WATER TO THE, UM, ALAMEDOS RESERVOIR.SO THAT'S TYPICALLY PUMP UP TO THE RESERVOIRS AND THEN IT GETS DISTRIBUTED TO THE CITY SYSTEM.
THE PROJECT GOAL FOR THIS IS TO ADDRESS UPGRADES TO EXISTING PUMPS AND MOTORS, DESIGN OF NEW BFD DRIVEN PUMPS, INSTRUMENTATION AND ELECTRICAL WORK, INCLUDING NEW MCCS SCADA AND UPGRADES TO ELECTRICAL FEED PING, STRUCTURAL AND MECHANICAL DESIGN.
AND FINALLY OPTIMIZED GROUNDWATER USAGE AND MINIMIZE MWD CONSUMPTION TO MEET DEMANDS.
ON JULY 29TH, 2024, STAFF SOLICITED PROPOSALS TO PROVIDE ENGINEERING DESIGN SERVICES FOR THE GROUNDWATER TREATMENT PLAN, BOOSTER PUMP STATION REHABILITATION PROJECT.
THREE PROPOSALS WERE RECEIVED, EVALUATED AND ANALYZED.
STAFF RECOMMENDS AWARDING AN AGREEMENT ON STANTEC CONSULTING SERVICES BASED ON THEIR PROJECT UNDERSTANDING PROMPT COMPREHENSIVE PROJECT APPROACH EXPERIENCE ON SIMILAR PROJECTS AND REASONABLE REASONABLENESS OF THEIR FEES.
THE NONE TO EXCEED AMOUNT OF THEIR SERVICES IS $1,125,846, AND THE DURATION OF THE AGREEMENT IS THROUGH THE PROJECT COMPLETION.
UM, WITH THAT BEING SAID, UM, STAFF RECOMMENDS TO ADOPT REQUEST FOR PROPOSAL AND AWARD AN AGREEMENT WITH STANTEC CONSULTING SERVICES TO PROVIDE ENGINEERING DESIGN SERVICES FOR THE GROUNDWATER TREATMENT PLANT, UM, PROJECT IN THE AMOUNT NOT TO EXCEED $1,125,846 AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE ALL DOCUMENTS NECESSARY TO ENTER INTO AN AGREEMENT, INCLUDING ANY NECESSARY SOME SUBSEQUENT AMENDMENTS.
UM, WITH THAT BEING SAID, UM, I WILL TAKE ON ANY QUESTIONS.
ANY PUBLIC COMMENT? ANY COMMISSIONER COMMENT? HEARING NONE? UH, DO I HAVE A MOTION TO APPROVE? MOTION? THANK, THANK YOU COMMISSIONER.
ANY OPPOSED? HEARING NONE OPPOSED, THE MOTION CARRIES.
[5. 24-55741 Recommendation to adopt Specifications WD-01-24 for the J. Will Johnson Reservoir Chemical Dosing Project (EO-3583) and authorize the General Manager to execute all documents necessary to enter into a construction contract, including any necessary subsequent amendments, with Green Building Corporation, in an amount not to exceed $3,966,620. Suggested Action: Approve recommendation. ]
ITEM NUMBER FIVE, TO ADOPT SPECIFICATIONS WD 0 1 24 FOR THE J WILL JOHNSON RESERVOIR CHEMICAL DOSING PROJECT EO 35 83 AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE A CONSTRUCTION CONTRACT WITH GREEN BUILDING CORPORATION.UM, GOOD MORNING, UH, PRESIDENT MCGUIRE AND COMMISSIONERS, UH, MY NAME IS YONG HUN WITH THE WATER SERVER SYSTEM, INFRASTRUCTURE GROUP AND WATER ENGINEERING.
SO THIS IS, UH, I'M PRESENTING THE ITEM ACTION NUMBER FIVE AND NUMBER SIX, THE GW JOHNSON RESERVOIR CHEMICAL DOSING PROJECT EO DASH 35 83.
UH, HERE'S A LITTLE BACKGROUND ON GWA JOHNSON RESERVOIR REC, UH, LOCATED IN 2200 IS UNIVERSITY DRIVE, UH, IN THE CITY OF COMPTON.
AND THIS IS ONE OF THE TWO, OUR CITY, UH, RESERVOIR THAT WE ARE, UH, UH, OWNED AND OPERATE.
SO THIS RESERVOIR CONSTRUCTED IN 1949 TO PROVIDE STORAGE OF PORTABLE WATER AND SERVE WEST PART OF THE, UH, LONG BEACH CUSTOMERS IMPORT WATER THROUGH THE LP FOUR INTERCONNECTION FROM MWD STORE WATER IN THE EXISTING 12 PORTABLE WATER TANKS AT 3.3 MILLION GALLON EACH AND APPROXIMATELY TOTAL CAPACITY OF 40 MILLION GALLONS DUE TO THE CHROMIUM VEGETABLE FLUCTUATION IN THE FLOW FROM MWD DETERMINED INSTALL CHEMICAL DOSING SYSTEM TO CONTROL AND STABILIZE THE CHROMIUM VEGETABLE.
SO, UH, THIS PROJECT NEEDS TO BE UPGRADE ON EXISTING TEMPORARY AMMONIA CHEMICAL PHASE SYSTEM.
THE USE, UH, THE IMPROVED, UH, AL RE.
SO PURPOSE OF THIS PROJECT IS TO IMPROVE OF THE EXISTING CHEMICAL DOSING SYSTEM BY CONSTRUCTING OF A PERMANENT SYSTEM TO REPLACE THE CURRENT TEMPORARY SYSTEM AND REHABILITATION OF A CHEMICAL DOSING SYSTEM PROJECT THAT WILL INCLUDE VARIOUS REMOVAL REPLACEMENTS, REPAIRS, AND NEW INSTALLATION.
SO THE, FOR THE, UH, ELECTRICAL COMPONENTS, REMOVE AND
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REPLACE ELECTRICAL PANELS, SWITCHES, AND CONDUIT WITH THE NEW WIRES.AND FOR THE PIPING AND PLUMBING COMPONENTS, REMOVE AND REPLACING STORAGE TANKS, PIPES, VALVES, FITTINGS, AND CHEMICAL MIXERS.
AND FOR THE UNDERGROUND STRUCTURE COMPONENTS, UH, WE'RE GONNA CONSTRUCT THE NEW SUB SURFACE PRECAST BYPASS BOLT AND THE STRUCTURE AND THE GRADING COMPONENTS WILL BE INSTALLING NEW METAL CANOPY TO PROTECTING CHEMICAL STORAGE TANKS FROM THE EXPORT OUTSIDE ELEMENTS AND THE TRENCH AND ER, UH, RESURFACING PAYMENT WORK INVOLVING WITH A NEW CHEMICAL FEED LINE.
AND HERE'S SOME, UM, PICTURES OF THE EXISTING CONDITIONS.
SO LEFT SLIDE, UH, UH, PICTURE SHOWS THE INSIDE OF THE EXISTING CHEMICAL MIXTURE WITH THE CHEMICAL FEED LINE AT THE INSIDE OF THE EXISTING MAP.
THE CENTER PICTURE SHOWS A EXISTING CHEMICAL STORAGE TANK THAT LOCATED INSIDE OF THE OPERATION BUILDING.
THE RIGHT SIDE OF THE PICTURE SHOWS THE, UH, UH, ABANDONED OUTSIDE THE CHEMICAL STORAGE TANK TO BE PLACED WITH A NEW CHEMICAL STORAGE TANKS WITH A PRE FABRICATED METAL.
ON AUGUST 5TH AND AUGUST 12TH, 2024, STAFF PUBLISHED, UH, NOTICE INVITING BID WITH UH, G WOLF JOHNSON RESERVOIR CHEMICAL DOSING PROJECT AS REQUIRED BY THE PUBLIC CONTRACT CODE SECTION 2 2 0 3 7 ON
THEREFORE, STAFF RECOMMENDED ADOPT ADOPTING SPECIFICATION W DASH ZERO ONE DASH 24 WITH THE JW JOHNSON RESERVOIR CHEMICAL DOSING PROJECT AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE THE ALL DOCUMENT NECESSARY TO ENTER INTO A CONSTRUCTION CONTRACT, INCLUDING ANY NECESSARY SUBSEQUENT AMENDMENT WITH A GREEN BUILDING CORPORATION IN AMOUNT NOT TO EXCEEDING $3,966,620.
[6. 24-55742 Recommendation to adopt Request for Proposal (RFP) EO-3583 and award an agreement with Lee & Ro, Inc., to provide construction management and inspection services for the J. Will Johnson Reservoir Chemical Dosing Project (EO-3583), in an amount not to exceed $692,521; and authorize the General Manager to execute all documents necessary to enter into the agreement, including any necessary subsequent amendments. Suggested Action: Approve recommendation. ]
ON OCTOBER 24TH, 2024 STEP SOLID STATED PROPOSAL TO PROVIDE CONTRACT CONSTRUCTION MANAGEMENT AND INSPECTION SERVICES FOR THE JW JOHNSON RESERVOIR CHEMICAL DOSING PROJECT ON LONG BEACH DEVICE THREE PROPOSAL WERE RECEIVED, EVALUATED AND ANALYZED STEP RECOMMEND TO RE-ENROLL INCORPORATED BASED ON THEIR PROJECT UNDERSTANDING EXPERIENCE, THE SIMILAR PROJECT AND COMPREHENSIVE PROJECT APPROACH.THEREFORE, STAFF RECOMMENDED ADOPT REQUEST FOR PROPOSAL EEO DASH 35 83 AND AWARD THE AGREEMENT WITH THE RE-ENROLL INCORPORATED TO PROVIDING CONSTRUCTION MANAGEMENT AND INSPECTION SERVICE FOR THE JO JOHNSON RESERVOIR CHEMICAL DOSING PROJECT IN AN AMOUNT NOT TO EXCEED $692,521.
AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE ALL DOCUMENTS NECESSARY TO ENTER INTO THE AGREEMENT, INCLUDING ANY NECESSARY SUBSEQUENT AMENDMENT.
UH, THIS IS CONCLUDE OF THE, UH, PRESENTATION FOR ITEM NUMBER FIVE AND SIX.
I'M HERE TO ANSWER, UH, ANY QUESTION YOU MAY HAVE.
AS YOU CAN SEE, WE'RE TAKING ITEMS NUMBER FIVE AND SIX TOGETHER AND WE'RE GOING TO VOTE ON THEM TOGETHER, CORRECT? MARCIA? UH, YOU CAN DO THAT, YES.
AND WE DON'T NEED TO, I DON'T NEED TO READ IT IN BECAUSE HE HAS, YOU DON'T NEED TO READ IT.
ANY PUBLIC COMMENT ON THIS ITEM? THESE TWO ITEMS? SEEING NONE, IS THERE ANY COMMISSIONER COMMENT? COMMISSIONER SCOTT, I THANKS FOR THE, UH, PRESENTATION.
SO I SEE IN HERE THAT THERE'S A, A ENGINEER'S ESTIMATE OF 1.9 MILLION.
HOW DID WE ARRIVE AT THAT? UM, THIS IS A, A PROJECT WAS, UH, UH, ENGINEERS BEEN AT 1.9, BUT DUE TO THAT, THIS IS A VERY SPECIALIZED, UH, UH, TYPE OF A PROJECT AND THERE'S NOT MANY, UH, CONSTRUCTION, UH, COMPANY, UH, ARE INTERESTED IN.
AND PLUS THAT THIS IS THE, UH, ASSOCIATED WITH THE PLA AGREEMENT TYPE OF PROJECT.
SO, UM, BASED ON THE AVAILABILITY ON THE INDIVIDUAL COMPANY.
SO IT'S ONLY, WE RECEIVED ONLY ONE BID.
THAT'S WHY IT COME UP WITH A 3.9 MILLION PROJECT.
BUT, UH, WHERE DID OUR 1.9 MILLION ESTIMATE COME FROM? UH, IT WAS BASED ON THE, UH, PREVIOUS DATA, UH, IN EACH INDIVIDUAL, UH, BID ITEM AND WE ESTIMATED AS 1.9.
BUT SINCE THE, UH, CONSTRUCTION PRICE COSTS INCREASED AND ALSO OWNING ONE, UM, BID IS AVAILABLE, SO THAT WAS, UH, A BIG GAP BETWEEN ENGINEER HA VERSUS, UH, UH, AND THE, UH, OWNING ONE BID AMOUNT.
AND WE ONLY RECEIVED ONE BID BECAUSE OF THE COMPLEXITY OF THE PROJECT.
UH, IT IS VERY SPECIALIZED IN CHEMICAL DOSING RELATED PROJECT.
AND ALSO THIS IS, UH, UH, ELA.
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SO, UM, BASED ON THAT, WE HAD, THE THREE COMPANIES SHOWED UP ON THE PRE MEETING, BUT THE OTHER TWO WE DRAW BECAUSE OF THE COMPLEXITY.NOT ONLY THAT, BUT ALSO ASSOCIATED WITH THE PLA.
ANY OTHER COMMISSIONER COMMENT? THANK YOU, ME, YOUNG.
UM, DO I HAVE A MOTION TO APPROVE ITEM FIVE AND SIX.
THANK YOU, COMMISSIONER SHANNON, DO I HAVE A SECOND? THANK YOU.
ITEMS FIVE AND SIX ARE APPROVED.
[7. 24-55743 Recommendation to adopt Specifications WD-11-23 for the Large Potable Water Valve Replacement Project Orange Avenue & Carson Street / San Antonio Drive, Stearns Street & Lakewood Boulevard (EO-3637) and authorize the General Manager to execute all documents necessary to enter into the agreement, including any necessary subsequent amendments with Stephen Doreck Equipment Rentals, Inc., in an amount not to exceed $1,864,175. Suggested Action: Approve recommendation. ]
TO ADOPT SPECIFICATIONS WD 1123 FOR THE LARGE POTABLE WATER VALVE REPLACEMENT PROJECT, ORANGE AVENUE AND CARSON STREET, SAN ANTONIO DRIVE, STERN STREET, LAKEWOOD BOULEVARD, EO 36 37 AND AUTHORIZED THE GENERAL MANAGER TO EXECUTE AN AGREEMENT WITH STEVEN DOAK EQUIPMENT RENTALS INC.COLIN MATTHEW CRUZ FOR OUR PRESENTATION AND WE ARE, IS MATTHEW'S PRESENTING FOR ITEM SEVEN AND EIGHT? SHOULD I READ NUMBER EIGHT AS WELL?
[8. 24-55744 Recommendaton to authorize the General Manager to issue Task Order No. 02-2024 under On-Call Construction Management Services (CMS) Contract No. UT-3888 to JIG Consultants to provide Construction Management and Inspection Services for the Large Potable Water Valve Replacement Project - Orange Avenue & Carson Street / San Antonio Drive, Stearns Street & Lakewood Boulevard (EO-3637), in the amount not to exceed $297,670. Suggested Action: Approve recommendation. ]
UM, IF YOU WANT TO TAKE THEM TOGETHER, YOU WANT ME TO READ ONLY SEVEN OR OH, ARE WE, ARE YOU VOTING ON THEM TOGETHER OR TAKING, WELL, HE'S PRESENTING TOGETHER, SO I'M WONDERING IF WE VOTE ON THEM TOGETHER.YEAH, ONE IS FOR THE CONSTRUCTION, THE OTHER ONE IS FOR THE CONSTRUCTION.
DO YOU HAVE SEPARATE PRESENTATIONS FOR EACH? THEY'RE BOTH ONE PRESENTATION.
WHAT DO YOU THINK THEN? UM, THEN YOU CAN READ EIGHT AND TAKE THEM TOGETHER.
SAY AGAIN? UH, YOU CAN READ EIGHT AND TAKE THEM TOGETHER.
TAKE SEVEN AND EIGHT TOGETHER.
ITEM NUMBER EIGHT IS TO AUTHORIZE THE GENERAL MANAGER TO ISSUE TASK ORDER NUMBER OH TWO ZERO OR PARDON ME, TWO ZERO TWO FOUR UNDER ONE CALL CONSTRUCTION MANAGEMENT SERVICES CMS CONTRACT NUMBER UT 38 88 TO JIG CONSULTANTS TO PROVIDE CONSTRUCTION MANAGEMENT AND INSPECTION SERVICES FOR THE LARGE POTABLE WATER VALVE REPLACEMENT PROJECT, ORANGE AVENUE AND CARSON STREET, SAN ANTONIO DRIVE, STERN STREET AND LAKEWOOD BOULEVARD.
UH, GOOD MORNING COMMISSIONERS.
I'M WITH THE PIPELINES INFRASTRUCTURE ENGINEERING GROUP.
UH, TODAY I'LL BE PRESENTING THE LARGE POTABLE WATER VALVES REPLACEMENT PROJECT.
THERE'S THREE INTERSECTIONS WHERE THIS WORK IS OCCURRING.
SO ORANGE AVENUE AND CARSON STREET, ORANGE AVENUE, AND SAN ANTONIO DRIVE.
AND THIRDLY IS THIRD STREET AND LAKEWOOD BOULEVARD.
SO, JUST A LITTLE BACKGROUND ON THE PROJECT.
UH, ENGINEERING HAS A LARGE VALVE REPLACEMENT PROGRAM TO REMOVE AND REPLACE INOPERABLE AND AGING LARGE VALVES IN THE CITY OF LONG BEACH.
REPLACING THESE VALVES IMPROVES SYSTEM RELIABILITY AND RESTORES OPERATIONAL FUNCTIONALITY FOR OUR LARGE VALVES.
WE, IN PARTICULAR, WE REPLACE GATE VALVES WITH BUTTERFLY VALVES.
SO WE HAVE A COUPLE OF CONSTRUCTION PHOTOS HERE.
THIS IS FROM ROY REDONDO, THAT'S A 30 INCH DIAMETER, UH, GATE VALVE THAT WAS REMOVED AND THAT WAS REPLACED WITH A 30 INCH BUTTERFLY VALVE.
SO THERE'S A SIGNIFICANT SIZE DIFFERENCE AND A SMALLER FOOTPRINT ALLOWS FOR EASIER INSTALLATION.
ABLE TO PUT THIS, UH, THIS CLIP.
SO ANOTHER DIFFERENCE IS THE MECHANISM.
UM, SO ON THE LEFT WE HAVE A GATE VALVE.
AS YOU CAN SEE, IT OPENS FROM TOP TO BOTTOM.
AND IF WE CAN PLAY THE SECOND ONE.
AND ON THE RIGHT WE HAVE A BUTTERFLY VALVE.
THE WAY THAT THIS OPENS AND CLOSES IS A DISC THAT ROTATES, UH, WHEN IT, WHEN THE VALVE IS TURNED.
AND BUTTERFLY VALVES TEND TO BE EASIER TO OPERATE.
REASON BEING, UM, IT'S FASTER TO OPERATE.
SO A LARGE BUTTERFLY VALVE CAN TAKE LESS THAN AN LESS THAN AN HOUR TO OPERATE, TO OPEN AND CLOSE WHILE THE SAME SIZE, UH, SAME DIAMETER GATE VALVE WILL TAKE OVER TWO HOURS TO.
SO GOING BACK TO THE BACKGROUND, UM, WHEN WE DO THE PROJECT PLANNING, UH, ENGINEERING RECEIVES UPTODATE DO, UH, UPTODATE VALVE INFORMATION, UH, WITH THE EFFORTS OF VALVE OPS, VALVE VALVE OPS HAS AN ONGOING THREE YEAR PROGRAM TO EXERCISE ALL LARGE WATER VALVES IN THE CITY OF LONG BEACH.
UH, VALVE OPS WILL OPERATE THESE VALVES AND REPORT THAT INFORMATION IF THE VALVE IS INOPERABLE.
THIS ALLOWS ENGINEERING TO PLAN AND JUSTIFY WHICH VALVES NEED TO BE PRIORITIZED FOR.
REPLACEMENT FACTORS INCLUDE VALVE INOPERABILITY, THE AGE OF
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THE VALVE, AND ALSO THE LOCATION.IS IT A BUSY STREET BUSY INTERSECTION? ARE THERE ANY OTHER VALVES AROUND THIS LARGE VALVE THAT ARE ALSO INOPERABLE AND WE NEED TO REPLACE? UH, THIS ALLOWS US TO CREATE A BETTER SCOPE, UH, MORE CO, MORE COST EFFECTIVE SCOPE.
SO MOVING ONTO THE PROJECT SCOPE, WE HAVE REMOVE AND REPLACE A FOUR 20 INCH DIAMETER GATE VALVES WITH 20 INCH BUTTERFLY VALVES.
WE ALSO HAVE FIVE 12 INCH GATE VALVES AND TWO SIX INCH GATE VALVES THAT WILL BE REMOVED AND REPLACED.
WE ALSO WILL BE REPLACING 500 LINEAR FEET OF PORTABLE WATER MAINS OF VARIOUS DIAMETERS.
SO THAT INCLUDES A SIX INCH, 12 INCH, 20 INCH, AND 30 INCHES AS WELL.
WE'RE ALSO, DURING THE CONSTRUCTION, WE'LL ALSO HAVE TRAFFIC CONTROL DEVICES AND MEASURES IN PLACE AND THE WATER MAINS AND VALVES TO BE REPLACED.
THEY WERE CONSTRUCTED IN THE 19TH ANTICIPATED START OF CONSTRUCTION IS MARCH, 2025.
UH, PROJECT DURATION IS 120 CALENDAR DAYS.
SO GOING BACK TO THE LOCATIONS, SO THIS FIRST ONE IS THE INTERSECTION OF ORANGE AVENUE AND SAN ANTONIO DRIVE.
WE HAVE MEDICAL OFFICES, RETAIL, UH, A COUPLE APARTMENT COMPLEXES AND ALSO, UM, SO THOSE ARE ALL IN THE, UH, IN THE, IN THIS INTERSECTION.
WE ALSO HAVE SINGLE FAMILY RESIDENCES IN THE VICINITY.
SO THE SECOND LOCATION IS ORANGE AVENUE AND EAST CARSON STREET INTERSECTION IS MAINLY RETAIL.
THERE'S ALSO A, A NEARBY MEDICAL OFFICE AND SINGLE FAMILY RESIDENT HOMES ALL IN THE VICINITY OF
THIRDLY, WE HAVE LAKEWOOD BOULEVARD AND STERN STREET.
UH, THERE'S RETAIL ON ALL FOUR CORNERS OF THE INTERSECTION.
AND THERE'S ALSO, THERE'S ALSO A SINGLE FAMILY RESIDENCE IN THE VICINITY.
UH, JUST JUST FOR CONTEXT, FOR ALL THREE INTERSECTIONS, THERE WILL BE TRAFFIC IMPACT OBVIOUSLY DURING THE CONSTRUCTION, BUT WE DO ANTICIPATE, UM, BUSINESSES IN THE VICINITY CAN REMAIN OPEN THROUGHOUT CONSTRUCTION.
AND WE ALSO DO NOT ANTICIPATE ANY WATER SERVICE SHUTDOWNS TO THE, UH, CUSTOMERS AND RESIDENTS.
ENGINEERING WILL ALSO COORDINATE WITH, UH, PUBLIC OUTREACH IN ORDER TO PROVIDE PUBLIC NOTIFICATIONS AND INFORM THE PUBLIC ABOUT THE WORK, UM, AT LEAST ONE MONTH IN ADVANCE.
SO WHEN THE PROJECT WAS BID OUT, ENGINEER'S ESTIMATE WAS TWO POINT WAS APPROXIMATELY $2.6 MILLION.
WE RECEIVED SIX BIDS IN TOTAL WITH, UH, STEVEN DORIC EQUIPMENT RENTALS BEING THE LOWEST RESPONSIVE BIDDER FOR CONSTRUCTION MANAGEMENT SERVICES.
UH, WE REACHED OUT TO OUR ON-CALL CMS BENCH AND THREE CONSULTANTS SUBMITTED FOR THAT.
SO THAT, UM, MOVING ONTO THE RECOMMENDATION, UH, ENGINEERING RECOMMENDS ADOPTING SPECIFICATIONS WD DASH 11 DASH 23 FOR THE LARGE POTABLE WATER VALVE REPLACEMENT PROJECT, EO 3 6 3 7, AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE ALL DOCUMENTS NECESSARY TO ENTER INTO THE AGREEMENT, INCLUDING ANY NECESSARY SUBSEQUENT AMENDMENTS WITH STEPHEN DORIC EQUIPMENT RENTALS IN AN AMOUNT NOT TO EXCEED $1,864,175.
ENGINEERING ALSO RECOMMENDS TO AUTHORIZE TASK OR AUTHORIZE THE GENERAL MANAGER TO ISSUE TASK ORDER NUMBER TWO TWENTY TWENTY FOUR FOR THE ON-CALL FROM THE ON-CALL CMS CONTRACT WITH GIG CONSULTANTS PROVIDE CONSTRUCTION MANAGEMENT SERVICES FOR THE LARGE VALVE REPLACEMENT PROJECT, EO 3 6 3 7 IN AN AMOUNT NOT TO EXCEED $297,670.
THAT CONCLUDES MY PRESENTATION.
WOULD BE HAPPY TO FIELD ANY QUESTIONS.
DO I HAVE ANY PUBLIC COMMENT? ANY COMMISSIONER COMMENT? SEEING NONE, DO I HAVE A MOTION TO APPROVE ITEM SEVEN AND EIGHT TOGETHER? THANK YOU.
[9. 24-55745 Receive and file report on Metropolitan Water District Conjunctive Use Program and Reverse Cyclic Program. Suggested Action: Receive and file. ]
ITEM NUMBER NINE TO RECEIVE AND FILE A REPORT ON METROPOLITAN WATER DISTRICT CONJUNCTIVE USE PROGRAM AND REVERSE CYCLIC PROGRAM.GOOD MORNING COMMISSIONERS FOR THE CURRENT ITEM NUMBER NINE.
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NUMBER NINE.WELL, IT'S GENDERIZED, SO I THINK THE BROWN ACT WOULD APPLY HERE WITH RESPECT TO, UM, ANY DISCUSSION ON THE ITEM.
THANK YOU FOR THAT QUESTION, COMMISSIONER SHANNON.
'CAUSE I WAS GOING TO CLARIFY FOR THE BOARD THAT THIS IS INFORMATIONAL.
UH, THE OBJECTIVE OF TODAY'S PRESENTATION IS TO GIVE THE BOARD A LITTLE BIT OF BACKGROUND FOR TWO ITEMS THAT I ANTICIPATE BRINGING BACK TO THE BOARD, UH, AT THE, AT THE NEXT MEETING.
AND SO THIS WAS TO HELP, UM, DO YOU HAVE ANY QUESTIONS THAT YOU MIGHT HAVE FOR STAFF? ANY ADDITIONAL INFORMATION YOU MIGHT WANT FROM US, UH, TO HELP YOU MAKE THE DECISION AT THE NEXT MEETING? UH, SO, SO TO GET A LITTLE BIT OF CONTEXT, UH, FOR THIS PRESENTATION, UH, THESE ARE TWO DIFFERENT PROGRAMS THAT, UH, METROPOLITAN HAS.
UH, AND SO I'LL CONTINUE THE THEME OF TWO FOR ONE ITEMS TODAY AT THIS BOARD MEETING TO, TO GET THROUGH THESE ITEMS PRETTY QUICKLY.
UH, THE, THE FIRST, UH, TOPIC I'LL DISCUSS TODAY IS THE, THE BACKGROUND ON WHY THESE TWO PROGRAMS ARE COMING TO THE BOARD FOR DECISION, UH, IN THIS FISCAL YEAR.
UH, AND, AND THAT HAS TO DO WITH THE METROPOLITAN RATE INCREASES AND THEIR CURRENT SITUATION WITH THEIR MINIMUM RESERVES.
UH, SO THEN I'LL GO INTO THE CONJUNCTIVE USE PROGRAM, UH, WHICH WE HAVE, UH, HAD WITH METROPOLITAN WATER DISTRICT SINCE 2002.
AND THEN I WILL DISCUSS THE REVERSE CYCLIC PROGRAM, WHICH IS A NEW PROGRAM THAT WE HAVE NOT PARTICIPATED IN, UH, BEFORE.
SO THE CONTEXT ON METROPOLITAN AND THEIR FINANCIAL SITUATION.
UH, THE BOARD MAY OR MAY NOT RECALL THAT EARLIER IN THIS YEAR, THE METROPOLITAN BOARD ADOPTED THEIR RATES FOR CALENDAR YEARS 2025 AND 2026.
AND AS YOU'LL SEE HERE, UH, THEY ADOPTED 11 AND 10% INCREASES GOING OUT TO THE FUTURE YEARS.
AND SO THAT WILL, UH, INCREASE FOR US THE COST OF IMPORTED WATER, UH, IN OUR, UH, IN OUR COMING YEARS.
AND WITH THE, UH, SITUATION AS IT'S PLAYING OUT, UH, THERE ARE DISCUSSIONS, UH, AND, AND I GUESS EXPECTATIONS THAT RATE INCREASES IN THE OUT YEARS COULD E BE EVEN HIGHER THAN THE 10 AND 11% THAT, UH, WE'RE GOING TO EXPERIENCE IN THE NEXT TWO YEARS.
THE METROPOLITAN MIN MINIMUM RESERVE, UH, THIS IS ESSENTIALLY WHAT'S TRIGGERING THE, UH, NEED FOR ACTION, UH, AT THE METROPOLITAN LEVEL.
UH, AND SO YOU'LL SEE IN THE, THE LAST, UM, A FEW YEARS THAT THEIR MINIMUM RESERVE HAS REALLY DRASTICALLY DROPPED.
UH, AND SO THAT HAS BEEN DUE TO THE WET YEARS.
AND SO, UH, WE EXPERIENCED A VERY SIMILAR SITUATION WHERE DUE TO THE WET YEARS, UH, WE, THE WATER SALES HAVE BEEN A LOT LOWER THAN EXPECTED.
AND THAT TREND HAS ACTUALLY CONTINUED, UH, THIS YEAR WHERE, UH, THE PROJECTIONS ARE THAT THEY WILL END UP, UH, SELLING LESS WATER THAN THEY HAD FORECASTED IN THEIR BUDGET.
AND SO, UH, GIVEN THAT SITUATION, THE MED BOARD DIRECTED THEIR STAFF TO LOOK INTO, UH, DIFFERENT PROGRAMS AND OPPORTUNITIES TO GENERATE REVENUE.
SO THAT'S WHAT THESE TWO, UH, NEXT PROGRAMS ARE INTENDED TO DO FOR METROPOLITAN.
AND THERE ARE OBVIOUS, UH, BENEFITS TO THE MEMBER AGENCIES, WHICH IS WHY, UH, WE ARE, UH, BRINGING THESE TO THE BOARD FOR CONSIDERATION.
SO TO EXPLAIN, THE FIRST PROGRAM, THE CONJUNCTIVE USE PROGRAM, CON CONJUNCTIVE USE IS A, A WATER INDUSTRY TERM THAT BASICALLY REFERS TO THE COORDINATED USE OF SURFACE WATER AND GROUNDWATER.
UH, SO ESSENTIALLY IN WET YEARS, WHAT WE CAN DO IS WE TAKE ALL OF THE RAIN AND SURFACE WATER, RIVERS, UH, LAKES, UM, STORAGE AND PUT THAT INTO, UH, GROUNDWATER STORAGE.
AND SO IN THE WET YEARS, UH, WE ARE ABLE TO PUT AWAY WATER THAT THEN IN DRY YEARS, WE'RE ABLE TO PUMP OUT OF THE GROUND RATHER THAN USING SURFACE WATER.
AND SO THAT'S WHAT CONJUNCTIVE USE MEANS.
UH, AND SO IN OUR CONJUNCTIVE USE PROGRAM AND THE AGREEMENT THAT WE HAVE WITH METROPOLITAN, UH, WE EXECUTED THAT IN, UH, BACK IN TWO, 2002.
AND ESSENTIALLY METROPOLITAN, UH, RECEIVED A GRANT AND THEY, UH, PASSED THROUGH THAT GRANT TO US TO HELP US CONSTRUCT, UH, UH, CONJUNCTIVE USE.
WELL, THAT'S ABLE TO INJECT AND EXTRACT GROUNDWATER, UH, IN EXCHANGE FOR THAT FUNDING FOR THE WELL, UH, IN, IN THE WAY THE PROGRAM WORKS IS THAT, UH, METROPOLITAN WILL, IN WET YEARS ASK US TO HELP THEM STORE WATER INTO OUR GROUNDWATER, UH, RESERVOIR.
AND SO WHEN WE STORE THAT WATER FOR METROPOLITAN IN THOSE WET YEARS, WE DON'T ACTUALLY PAY THEM FOR THAT WATER IN THAT YEAR.
UH, WE PUT THAT WATER, UH, ASIDE, UH, FOR, FOR USE IN FUTURE YEARS.
AND FINANCIALLY, THAT AMOUNT OF, UM, UH, THAT, THAT FINANCIAL COST OF THAT IMPORTED WATER IS, IS SET ASIDE BECAUSE WE KNOW IN A FUTURE YEAR, WHEN WE PULL THAT WATER OUT OF THE GROUND, WE'LL HAVE TO PAY METROPOLITAN FOR THAT WATER AT THAT TIME.
AND SO OVER THE LAST FEW YEARS, UH, IN THE WET YEARS, WE'VE ACTUALLY PUT, UH, OVER 6,000 ACRE FEET OF WATER INTO
[01:00:01]
GROUNDWATER STORAGE FOR METROPOLITAN.WHEN WE PUMP THAT WATER OUT FOR METROPOLITAN, WE PAY THEM THE, THE THEN GOING RATE OF, UH, IMPORTED WATER.
BUT WE DO GET AN OFFSET, UH, IN POWER AND, UH, OPERATIONS AND MAINTENANCE CREDIT BECAUSE THEY RECOGNIZE THAT THE COST TO US TO PRODUCE THAT GROUNDWATER, UM, IT IT'S NOT FREE TO US TO PRODUCE THAT GROUNDWATER.
AND SO THEY DO GIVE US, UH, AN OFFSET.
UH, SO THAT DOES SLIGHTLY REDUCE THE COST OF THAT IMPORTANT WATER.
NOW THE AGREEMENT IS SET TO EXPIRE IN 2027.
AND SO, UH, ABSENT THIS FINANCIAL, UH, SITUATION FOR METROPOLITAN, IT WAS EXPECTED THAT WE WOULD BE, UH, UH, TRYING TO DRAW DOWN THAT BALANCE OVER THE NEXT THREE YEARS TO CLOSE OUT THE, THE AGREEMENT WITH NOTHING LEFT IN, IN STORAGE.
SO THE FINANCIAL SITUATION FROM METROPOLITAN HAS ACTUALLY PRESENTED AN OPPORTUNITY AND ACCELERATES THE TIMELINE OF US, UH, US AND METROPOLITAN, TRYING TO CLEAR OUT THE BALANCE OF THE CONJUNCTIVE USE, UH, ACCOUNT.
SO RATHER THAN PUMPING OUT THE WATER OVER THE NEXT THREE YEARS AND PAYING THEM OUT GRADUALLY, UH, AS WE PUMP THAT WATER OUT, METROPOLITAN HAS APPROACHED US TO SEE IF WE WOULD BE INTERESTED, UH, IN, IN JUST BUYING OUT THE WATER, ESSENTIALLY PAYING THEM FOR THE WATER THAT'S STORED, AND THAT WOULD BECOME OUR STORED WATER AND PAY THEM WHAT, WHAT WOULD BE OWED TO THEM IF WE HAD HUNTED THAT OUT IN FUTURE YEARS.
AND SO THE BENEFIT TO METROPOLITAN IS THAT THAT WOULD PROVIDE THEM IMMEDIATE REVENUE, UH, IN THIS, THIS CALENDAR YEAR.
UH, AND, UH, IT WOULD HELP US TO ESSENTIALLY, UM, BOTH CLEAR OUT THE, THE OBLIGATIONS OF THE AGREEMENT.
UH, THE CONJUNCTIVE USE AGREEMENT, THE BENEFITS OF LONG BEACH UTILITIES WOULD BE A PROJECTED COST SA COST SAVINGS OF UP TO $1.4 MILLION.
AND THAT, THAT SAVINGS IS DUE TO THE, THE FACT THAT THE METROPOLITAN RATES ARE INCREASING OVER THE NEXT TWO YEARS, UH, AND, AND LIKELY THE NEXT THREE YEARS.
UH, SO WE WOULD AVOID PAYING THOSE FUTURE METROPOLITAN RATES, METROPOLITAN'S OFFERING US TO BUY OUT THE COUNT AT TODAY'S CURRENT, UH, IMPORT WATER RATES.
AND, UH, THE PART THAT LESS IS, IS LEFT TO BE NEGOTIATED IS THE, THE POWER AND O AND M CREDIT THERE IS NOT REALLY A, A PRECEDENCE, UH, FOR, UH, BUYING OUT THIS CONJUNCTIVE USE ACCOUNT.
AND SO METROPOLITAN STAFF HAS INDICATED THAT THEY'RE, UH, WILLING TO NEGOTIATE WITH ME, UH, WITH LONG BEACH AS FAR AS THE, THE PAYMENT OF THE, UH, UH, O AND M CREDIT AS WELL.
'CAUSE THAT WAS, THAT WOULD BE WHAT WOULD HELP US OFFSET CERTAIN COSTS IN FUTURE YEARS IF WE WERE TO.
AND SO, UH, I'LL, I'LL BE, UH, NEGOTIATING WITH METROPOLITAN THE PAYMENT, BUT THE EXPECT EXPECTATION, UH, IS THAT WE'LL RECEIVE SOME SORT OF POWER AND O AND M CREDIT, UH, AS PART OF THIS BUYOUT PROCESS.
DEAN, YES, I, I DON'T KNOW IF THIS IS COMING LATER IN THE SLIDES, BUT JUST IN CASE IT ISN'T.
BUT ONE OF THE ASPECTS OF THE CONTRACT IS IT IS A CONTRACTUAL ARRANGEMENT WHEN WE STORE THE WATER, WE STORED THE WATER, NOT BY INJECTING IT, BUT BY ACTUALLY DRINKING THAT WATER AND JUST LEAVING OUR GROUNDWATER IN THE GROUND.
SO IN ESSENCE, WE DRANK THE WATER.
METROPOLITAN DID NOT CHARGE US FOR THAT WATER.
AND THE NET EFFECT OF IT WAS THE RESULT OF WHAT THE CONTRACT SOUGHT TO ACHIEVE.
WHEN YOU'RE POINTING OUT THE FUTURE YEARS AND THE POTENTIAL OF EXPOSURE TO THEN HAVING TO NOW PRODUCE THAT WATER IN THE CONTRACT, THERE IS A CONTRACTUAL OBLIGATION THAT IF METROPOLITAN SAYS, YOU MUST PRODUCE THE WATER, YOU WILL PRODUCE THAT WATER UNDER CONTRACT.
SO THERE IS AN OBLIGATION IF THEY CALL, AND THIS STRUCTURES ITSELF AS A WAY OF SAYING, TELL YOU WHAT, WE WON'T CALL ON THAT IN THE FUTURE IF YOU WANNA BUY IT TODAY.
YEAH, THAT, THAT'S ABSOLUTELY CORRECT.
AND, AND THAT KIND OF SPEAKS TO THE LAST POINT, THE SELF-CONTROL OVER WHEN WE PUMP FROM STORAGE.
SO ABSENT BUYING OUT THIS, THIS, UH, ACCOUNT FROM METROPOLITAN, THEY WILL ESSENTIALLY, THEY'VE, THEY'VE COMMUNICATED THAT THEY WILL EXPECT US TO PRODUCE, UH, IN THIS COMING YEAR, UH, CALENDAR YEAR STARTING JANUARY, AND, UH, TO, TO GET OUT THE 6,000 PLUS ACRE FEET, UH, THAT WE HAVE IN STORAGE.
IT'S, IT'S, WE, WE WILL BE PUMPING OVER THE NEXT THREE YEARS, ESSENTIALLY, TO FULFILL THAT OBLIGATION OF THE CONTRACT.
IF WE BUY OUT THE ACCOUNT, THEN THAT ALLOWS US AND OUR OPERATIONS, THE, THE FLEXIBILITY TO PUMP THAT OUT ON OUR OWN SCHEDULE WHEN IT'S, UH, MOST BENEFICIAL TO US, RATHER THAN ESSENTIALLY BEING FORCED TO PUMP THAT OUT OVER THE NEXT THREE YEARS.
UH, SO THE NEXT PROGRAM THAT I WANNA DISCUSS IS THE REVERSE CYCLIC PROGRAM, AND TO HELP, UH, UM, PROVIDE AN EXPLANATION OF WHAT THE REVERSE CYCLIC PROGRAM IS AND WHAT THE TERMINOLOGY THAT WOULD BE HELPFUL TO, TO EXPLAIN WHAT THE CYCLIC PROGRAM IS FOR METROPOLITAN.
AND SO FOR THE CYCLIC PROGRAM, METROPOLITAN, UH, ESSENTIALLY IN WET YEARS HAS A LOT OF WATER THAT IF THEY DON'T DELIVER TO MEMBER AGENCIES TO HELP METROPOLITAN STORE WOULD ESSENTIALLY GO OUT TO THE OCEAN.
UH, AND SO IN WET YEARS, UH, METROPOLITAN, UH, LOOKS TO MEMBER
[01:05:01]
AGENCIES THAT HAVE THE ABILITY TO TAKE EXTRA WATER, UH, TO TAKE THAT WATER.UH, THEY RECOGNIZE THAT THE, THE MEMBER AGENCIES MIGHT NOT NECESSARILY HAVE THE FINANCIAL CAPABILITY TO PAY OUT FOR ALL THAT WATER IN ONE GIVEN FISCAL YEAR.
AND SO THEY ALLOW MEMBER AGENCIES TO PAY FOR THAT WATER.
UH, OVER TIME, REVERSE CYCLIC WORKS THE OPPOSITE WAY, OPPOSITE WAY AROUND, WHICH IS, IN THIS CASE, AS I EXPLAINED, METROPOLITAN IS LOOKING FOR REVENUE NOW AND DOESN'T NECESSARILY HAVE WATER THAT THEY WANT TO DELIVER RIGHT NOW.
AND SO REVERSE CYCLIC IS ESSENTIALLY MEMBER AGENCIES WILL PAY METROPOLITAN UPFRONT FOR A, A, A PREDETERMINED AMOUNT OF WATER, AND MEMBER AGENCIES WILL TAKE THAT WATER IN SMALLER DELIVERIES OVER TIME.
SO THERE ARE A COUPLE OPTIONS THAT, UH, WE COULD, UH, MOVE FORWARD WITH HERE.
UH, WE HAVE NOT PARTICIPATED IN THE REVERSE CYCLIC PROGRAM BEFORE IN THE PAST.
UM, THE BENEFIT OF THE REVERSE CYCLIC PROGRAM, AGAIN, IS THE, THE, THE BACKGROUND OF THE METROPOLITAN RATE INCREASES.
AND SO IF WE WERE TO PRE-PURCHASE WATER, WE ARE ESSENTIALLY LOCKING IN, UH, 11% OR 10% DISCOUNT, OR EVEN GREATER THAN THAT IF IT'S, UM, DELIVERED IN FUTURE YEARS.
SO THAT'S THE OPPORTUNITY THAT WE'RE TRYING TO WEIGH AND WOULD LIKE THE BOARD, UH, TO CONSIDER.
UM, BUT IT IS NOT A, UH, REQUIREMENT THAT WE PARTICIPATE IN THE REVERSE CYCLIC PROGRAM.
UH, AND SO WHEREAS THE CONJUNCTIVE USE PROGRAM, THAT'S AN OBLIGATION AND AGREEMENT THAT WE'VE ALREADY ENTERED INTO, AND, AND IT'S A, UH, A SLIGHTLY DIFFERENT, UM, DECISION.
IT'S MORE OF A DO WE WANT TO BUY IT OUT VERSUS PERFORM OVER TIME.
REVERSE CYCLIC PROGRAM IS A, UH, UH, DECISION THAT WE COULD, UH, OPT TO NOT PARTICIPATE AT ALL, AND THAT WOULD JUST BE FOREGOING THE OPPORTUNITY TO, UH, SAVE IN FUTURE YOUR WATER RESOURCES COSTS.
SO OPTION ONE, DO NOT PARTICIPATE IN THE REVERSE CYCLIC PROGRAM.
OPTION TWO IS, UH, TO PREPURCHASE 5,000 ACRE FEET.
UH, THIS IS AN AMOUNT THAT, UH, STAFF DETERMINED BASED ON OUR CURRENT FINANCIAL, UH, POSITION THAT, UH, WOULD BE, UH, ACHIEVABLE.
AND THE COST TO DO THAT WOULD BE APPROXIMATELY $6.3 MILLION.
AND THAT'S THE 5,000 ACRE FEET MULTIPLIED BY THE 1200, UH, DOLLARS PER PER FOOT OF CURRENT YEAR RATES.
AND IF WE WERE TO DO THAT, UH, THE PROJECTED SAVINGS WOULD BE ABOUT 1.3 MILLION, AND THE EXACT SAVINGS WOULD BE, UM, BASED ON WHEN WE ACTUALLY TAKE DELIVERY OF THAT WATER.
SO THAT'S A, A ROUGH, UH, PROJECTED SAVINGS.
UH, BUT THAT, THAT'S, THAT WOULD BE THE ORDER OF MAGNITUDE THAT WE'D BE LOOKING AT.
AND THEN OPTION THREE, UH, WOULD BE TO PRE-PURCHASE 10,000 ACRE FEET.
NOW THIS IS AN AMOUNT THAT WOULD STRETCH US FINANCIALLY, UM, BUT AGAIN, THE BENEFITS ARE, UH, ESSENTIALLY GUARANTEED COST SAVINGS OUT IN THE FUTURE.
AND SO THAT WOULD BE WHERE IT WOULD BE, UH, AT THE DIRECTION OF THE BOARD, WHAT WOULD BE THE BEST, UH, BEST DECISION FOR LONG BEACH UTILITIES AND SO ON THAT, UH, 10,000 ACRE FEET ESSENTIALLY DOUBLED THE, THE LAST OPTION, $12.6 MILLION IN COST FOR PROJECTED SAVINGS OF 2.7 MILLION.
SO WITH THAT, I'LL CONCLUDE MY PRESENTATION AND OPEN IT UP TO ANY QUESTIONS FROM THE BOARD.
WE APPRECIATE THE INFORMATION AND THE NOTICE IN ADVANCE SO THAT WE CAN BE PREPARED FOR WHAT YOU HAVE FOR US NEXT.
AND IT'S JUST A LOT TO, TO PROCESS.
I KNOW THE GIVE AND TAKE THAT'S REQUIRED, AND WE APPRECIATE YOUR FUTURE PLANNING AND WISDOM.
YOU KNOW, TO SECURE THE FUTURE OF OUR WATER SUPPLY AND OUR SAVINGS TO RATE PAYERS AT HOPEFULLY AN AFFORDABLE RATE WITH ALL THESE COMPLEXITIES, WITH RATES, WITH CONSIDERING METROPOLITAN AS WELL AS A PARTNER.
SO THANKS VERY MUCH, DEAN FOR THAT.
DO I HAVE ANY PUBLIC COMMENT? DO YOU HAVE ANY COMMISSIONER COMMENT? COMMISSIONER SCOTT? UH, THANK YOU.
I DON'T KNOW IF YOU KNOW THIS OR NOT, BUT I, I LOVE STUFF LIKE THIS,
UH, SO THE, THE CUP BUYOUT OPPORTUNITY, UH, WHAT IS THE COST OF THAT? IT'S APPROXIMATELY $7 MILLION.
UH, AND THAT'S UNBUDGETED, RIGHT? UH, I'M GONNA GET, GET FINANCIAL TERMS INCORRECT, BUT WHEN WE TOOK THE WATER, UM, IT, IT WAS AT NO COST TO US AND IT WAS SET ASIDE.
AND SO WE HAD, UH, EARMARKS FUNDS TO, TO PURCHASE THAT.
INITIALLY IT WAS MEANT TO, TO PURCHASE OUT OVER TIME, BUT IT SET ASIDE AND WE HAVE THAT AVAILABLE TO PURCHASE, UH, OUTRIGHT.
AND THE AMOUNT WE HAVE SET ASIDE IS COINCIDENTALLY $7 MILLION APPROXIMATELY.
UM, COMMISSIONER SCOTT, BECAUSE PUTTING THE WATER INTO THE GROUND, WE DID NOT PHYSICALLY DO THAT.
WE SIMPLY DRANK THAT WATER, SO WE BUDGETED FOR THAT WATER AT FULL COST IN THAT FISCAL YEAR, BUT METROPOLITAN DIDN'T CHARGE US, SO WE ESSENTIALLY DRANK THAT WATER.
THERE WAS A BUDGETED ITEM AND THAT COST WAS NOT EXPENDED.
SO THE VERY NET EFFECT OF THAT IS INDEED
[01:10:01]
TO CREATE THIS, THIS AMOUNT OF MONEY, UH, SITTING AND AVAILABLE.AND THAT'S ON THE CONJUNCTIVE USE SIDE, IS, IS THE $7 MILLION CONSIDERED TO BE PART OF THE RESERVES OF WATER? IT, IT IS IN TERMS OF DISCRETIONARY FUNDS AT THE DISCRETION OF THE BOARD.
IT IS NOT IN THE FUND BALANCE NUMBERS THAT WE HAD SHOWN TO THE BOARD AS THE NET EFFECT OF BUDGET DECISIONS AND RATE DECISIONS.
UH, AND, UH, OKAY, SO WITH THE REVERSE CYCLICAL PROGRAM, 10,000 ACRE FEET, WHAT DOES THAT REPRESENT AS FAR AS YOU SHOULD? IS THAT A YEAR'S WORTH? IS THAT A FEW DAYS WORTH? THAT'S APPROXIMATELY, UH, ONE YEAR'S WORTH OF, OF IMPORTED WATER.
UM, AND SO THAT, THAT AMOUNT, UM, IT REPRESENTS WHAT WE CAN, UH, POTENTIALLY HANDLE FINANCIALLY, BUT IT'S ALSO, UH, DUE TO ADDITIONAL, UH, INTRICACIES AND, AND DETAILS OF THE PROGRAM THAT IT DIDN'T GET INTO, THAT'S, UH, THE LEVEL THAT STAFF WOULD BE COMFORTABLE.
WE COULD, UM, TAKE, UH, IN, IN THE TIMEFRAME OF THE AGREEMENT.
AND, AND TO BE CLEAR, METROPOLITAN, I'M SORRY, COMMISSIONER SCOTT, TO, TO BE CLEAR, METROPOLITAN WOULD ESTABLISH ITS OBLIGATIONS TO DELIVER THAT WATER.
SO IT'S NOT STRICTLY ON OUR CALL, IT WOULD BE A BALANCE OR A RELATIONSHIP BETWEEN US AND METROPOLITAN.
WHEN THE WATER IS AVAILABLE, THEN PER THE TERMS OF THIS REVERSE CYCLIC AGREEMENT, IT WOULD SAY, THIS PORTION OF OUR DELIVERIES TO YOU FELL UNDER THIS, AND SO THEREFORE THAT PART IS ALREADY PREPAID, BUT IT IS NOT A GUARANTEE THAT IN THE NEXT YEAR THEY WOULD DELIVER EXACTLY THAT AMOUNT.
AM I SAYING THAT RIGHT, DEAN? YES, CORRECT.
AND, AND SO TO, TO THE, YOU KNOW, THE BOTTOM LINE OF THIS REPRESENTATION, UM, METROPOLITAN HAS THE DISCRETION.
IF, IF THIS YEAR IS A DRY YEAR, FOR INSTANCE, THEY MAY SAY, WE DON'T HAVE WATER AVAILABLE TO DELIVER FOR THIS PROGRAM.
UM, TWO YEARS FROM NOW, THREE YEARS FROM NOW, MAYBE THEY WON'T BE ABLE TO EITHER.
SO IT MIGHT BE NOW YEARS FOUR AND FIVE THAT THEY DELIVER OVER TIME.
UM, AND SO GIVEN THOSE, UM, CONSIDERATIONS, 10,000 AC FEET ON ONE YEAR'S FULL DEMAND, UH, THAT'S, THAT'S WHAT STAFF IS CONFIDENT THAT WE WOULD BE ABLE TO RECEIVE, UH, THROUGH THIS, UH, PROGRAM IF WE PARTICIPATED IN THAT.
IN THAT REGARD, THIS IS AN AMOUNT OF MONEY, A FINANCIAL COMMITMENT THAT I CANNOT CORRELATE TO A NATURAL TRANSACTION PREVIOUSLY.
AT THE SAME TIME, FOR THE GRAPH THAT DEAN SHOWED AND HE SHOWED YOU THE 10 AND 11%, IT'S IMPORTANT TO UNDERSTAND THAT THOSE ARE CUMULATIVE ON TOP OF EACH OTHER.
SO IN THE SECOND YEAR WHEN IT SAYS 11, THAT RATE IS NOW ESSENTIALLY 21% HIGHER THAN THE PREVIOUS RATE.
SO THERE, THERE'S THIS DYNAMIC IMBALANCE OF THE LONGER YOU WAIT, THE GREATER THE BENEFIT.
THE QUESTION IS WHETHER YOU HAVE THE FINANCIAL CAPABILITY TO GO NOW AND THEN REAP THAT BENEFIT DOWN.
AND I, AND I CAN SEE YOUR UNDERSTANDING THIS RELATIONSHIP, THE, UH, SO THE, THE IMMEDIATE COST, THE 12.6 MILLION FOR OPTION THREE, THE 10,000 ACRE FEET, UM, THAT'S OBVIOUSLY NOT BEEN BUDGETED, HAS RISEN.
UM, DOES THAT MONEY COME OUT OF RESERVE? YOUR QUESTIONS ARE, ARE ALL IN LINE.
SO AS WE BRING THIS ITEM TO YOU FOR ACTION, WE'LL BE CLEARED TO EXPLAIN WHERE THE SOURCE OF FUNDS WOULD BE, WHAT IS THE ASSOCIATED RISK EXPOSURE, AND THEN CONTRAST THAT WITH THE OPPORTUNITY THAT PRESENTS ITSELF, THEN THAT FULL PICTURE.
THEN YOU THEN HAVE THE BASIS OFF OF WHICH TO, TO MAKE THAT, UH, MAKE THAT DECISION.
BUT YOU ARE CORRECT THAT WE WOULD BE NEEDING TO EXPLAIN ALL OF THAT IN ORDER TO HAVE A COMPREHENSIVE DECISION AND THE PROJECTED SAVINGS ON, UH, THE PROJECTED SAVINGS ON THE BUYOUT OPPORTUNITY.
THERE IS, UH, I DIDN'T PROVIDE THAT.
UM, BUT AGAIN, IT IS, IT'S DEPENDENT ON EXACTLY HOW THE PUMPING WOULD PLAY OUT.
UM, BUT IT WAS ON THE ORDER OF MAGNITUDE ABOUT A MILLION DOLLARS.
OKAY, SO A MILLION THERE AND 2.7 MILLION.
UM, IF WE WERE TO DO OPTION THREE TO 10,000 ACRE FEET ON THE REVERSE CYCLICAL PROGRAM, UH, WOULD THAT ROUGHLY $4 MILLION THEN BE ADDED TO THE RESERVE BALANCE THAT WE'RE WE'VE BEEN TRYING TO BRING OUR RESERVES UP? IT COULD POTENTIALLY, THE QUESTION WOULD BE, DEPENDING ON WHAT OUR BUDGETED EXPENDITURES ARE FOR THE COMING YEAR, WHAT RATE SETTING DECISION DOES THE BOARD WISH TO ENGAGE IN? DEPENDING ON THE NATURE OF THE RATE SETTING, IT COULD STILL BE IN A DEFICIT MODE, IN WHICH CASE THESE SAVINGS WOULD HELP MITIGATE SOME OF THE IMPACTS TO THE RATES AND WOULD NOT NECESSARILY TRANSLATE INTO A FUND BALANCE GAIN.
AT THE SAME TIME THOUGH, DEPENDING ON THE RATE DECISION THAT YOU MAKE, IF IT IS A MORE BALANCED BUDGET, THEN INDEED THESE SAVINGS DO PLAY THEMSELVES DIRECTLY INTO GAINING FUND BALANCE OVER TIME.
ANY OTHER COMMISSIONER COMMENT? THANK YOU,
DO I HAVE A MOTION? WHAT? PARDON ME? WHAT DO I
[01:15:01]
NEED HERE? DO I HAVE A MOTION TO RECEIVE AND FILE? SECOND RECEIVED FIRST AND A SECOND.ANY OPPOSED? NO, THANK YOU SO MUCH.
[PUBLIC COMMENT Opportunity to address the Utilities Commission on non-agenda items. Each speaker is limited to three minutes to make their comments unless extended by the Board.]
COMMENT PERIOD NOW, AND I, UM, IS THERE ANYONE WISHING TO SPEAK ON A NON-AG AGENDA ITEM? SEEING NONE.THE PUBLIC COMMENT PERIOD IS NOW CLOSED.
[ANNOUNCEMENTS]
PORTION I CALL ON OUR GENERAL MANAGER.I HAVE, UH, GIVEN YOU A SERIES OF, OF ARTICLES AND HAVE SOME ADDITIONAL HANDOUTS TO COMMENT ON.
THE ARTICLES I HAVE FOR YOU ARE INDEED FOR THOSE NIGHTS WHEN YOU CAN'T SLEEP AND NEED SOMETHING TO DESPERATELY PUT YOU TO SLEEP.
UM, BUT I'VE STRUCTURED THEM IN ORDER SO THAT IF YOU SEE THEM IN ORDER, IT CAN GIVE YOU A SENSE OF WHAT'S COMING IN FUTURE INFORMATION ITEMS AND ACTIVITIES THAT DIRECTOR CORDERO IS ACTUALLY INVOLVED IN.
SO THE FIRST ONE IS AN LA TIMES ARTICLE THAT CAME OUT RECENTLY, AND IT'S A FAIRLY COMPREHENSIVE ONE.
IT TALKS ABOUT THE BIDEN ADMINISTRATION, UH, OUTLINING OPTIONS FOR ADDRESSING THE COLORADO RIVER WATER SHORTAGES.
BUT I'VE TAKEN THE LIBERTY TO HIGHLIGHT FOR YOU CRITICAL PARTS OF THAT ARTICLE.
UM, THERE'S BEING OPTIONS BEING CONSIDERED ON THE RIVER ITSELF, DRAINING SEVEN WESTERN UNITED STATES, INCLUDING PROVIDING WATER TO MEXICO.
AND THOSE DISCUSSIONS ARE FAIRLY CONTENTIOUS.
UM, THE SEVEN STATES CANNOT AGREE ON A SOLUTION, UH, FACING CLIMATE CHANGE.
THEY KNOW THAT THEY MUST REDUCE THEIR NEED FOR WATER, AND I, I STRESS THAT THAT'S THE CRITICAL WORD.
THEY MUST REDUCE THEIR NEED FOR WATER.
IT'S IMPERATIVE THAT THEY FIND A SOLUTION AND TO DATE, THEY CANNOT COME TO A SINGLE AGREEMENT.
WHAT STANDS ON THE OPPOSITE END OF THIS DISCUSSION IS THE UNITED STATES BUREAU OF RECLAMATION.
SO THE UNITED STATES BUREAU OF RECLAMATION IS THE ADMINISTRATOR OF THE INFRASTRUCTURE ON THE RIVER.
IT PROVIDES BOTH WATER AND ELECTRICAL POWER AS WELL TO THESE SEVEN WESTERN UNITED STATES.
THE UNITED STATES BUREAU OF RECLAMATION THROUGH THE DEPARTMENT OF THE INTERIOR HAS STATED ALREADY THAT THEY'RE DOING THEIR OWN ANALYSES AND BY CONTRACT THEY FEEL AN OBLIGATION TO PRESERVE POWER AND WATER TO THE SEVEN WESTERN STATES.
AND IN ESSENCE, THEY HAVE INDICATED MANY A TIME NOW THAT THEY WILL COME UP WITH THEIR OWN SOLUTION IF THE SEVEN WESTERN STATES FAIL TO AGREE.
UM, THAT'S IN THE HIGHLIGHTS THAT I'VE SHOWN YOU.
ANOTHER CRITICAL ASPECT OF THE HIGHLIGHT HAS BEEN A REPRESENTATION BY THE UNITED STATES BUREAU OF RECLAMATION THAT YOU MAY HAVE SEEN, UM, ALL KINDS OF ARTICLES IN THE PAST TWO YEARS ABOUT THE FANTASTIC AGREEMENT THAT THE SEVEN STATES CAME TO, UH, AGREE ON FOR SHORT-TERM SOLUTIONS ON THE RIVER.
AND WHAT IS AN UNDERTONE OF THIS ARTICLE? IT HIGHLIGHTS THAT NATURE, UH, IN THE FORM OF BOUNTIFUL SNOW AND RAIN WAS WHAT ALLOWED THE SEVEN WESTERN STATES TO COME TO AGREEMENT FOR THESE SHORT-TERM SOLUTIONS.
AND THE BUREAU OF RECLAMATION HAS STATED IN THE ARTICLE THAT SHORT-TERM SOLUTIONS WILL NOT BE ALLOWED IN THE FUTURE SOLUTIONS THAT THEY EXPECT FOR POST 2026 OPERATIONS ON THE RIVER.
EMBEDDED IN THIS IS THE, UH, ASSOCIATION, THE COLORADO RIVER WATER USERS ASSOCIATION MEETS ANNUALLY, AND IN FACT, THEIR DELIBERATIONS ARE OCCURRING, UH, AT THIS VERY MOMENT.
IT'S INSIGHTFUL THAT THAT'S A CONFERENCE AND EVERYBODY COMES TOGETHER AND THAT'S WONDERFUL.
BUT ONE OF THE OTHER PURPOSES OF THAT MEETING IS TO JOIN THE VARIOUS PARTIES AND GIVE THEM CONFERENCE ROOMS SO THAT THEY CAN NEGOTIATE AND THAT'S WHAT THE ARTICLE HIGHLIGHTS FOR YOU RIGHT NOW.
IN DOING SO, THE NEXT SEQUENCE OF ARTICLES, UH, NEXT SEQUENCE OF ATTACHMENTS IS, UH, STARTS OUT WITH A LETTER.
THAT LETTER IS FROM THE METROPOLITAN WATER DISTRICT AND IS BEING DELIVERED TO THE DIRECTOR OF THE DEPARTMENT OF WATER RESOURCES.
THIS IS A CRITICAL POINT FOR ANOTHER WATER SUPPLY PROJECT, WHICH YOU MAY HAVE HEARD CALLED THE DELTA CONVEYANCE PROJECT.
AND THIS IS A MODERNIZATION OF THAT INFRASTRUCTURE.
IT'S IN A VERY EXPENSIVE PROJECT.
IT IS CURRENTLY IN ITS ENVIRONMENTAL IMPACT REPORT PHASE, AND THERE'S STILL ADDITIONAL STUDIES THAT ARE GOING TO BE REQUIRED TO COMPLETE THAT, BUT THAT COSTS MILLIONS AND MILLIONS OF DOLLARS TO DO THAT WORK.
METROPOLITAN IS BEING ASKED TO CONSIDER HONING UP THE MONEY NECESSARY TO DO THOSE STUDIES.
THIS IS AN UNBUDGETED ITEM, AS YOU SAID, COMMISSIONER SCOTT.
SO THE 10 AND 11% RATE INCREASES THAT YOU SEE FROM METROPOLITAN, THE MILLIONS OF DOLLARS OF COMMITMENT THAT WOULD BE REQUIRED, THAT'S NOT IN THOSE RATE INCREASES.
AND YET AT THE SAME TIME, IT IS CRITICALLY IMPORTANT TO DO THOSE STUDIES TO TRULY UNDERSTAND WHETHER THIS PROJECT PASSES ENVIRONMENTAL REVIEW AND MAKES IT TO THE FINISH LINE.
SO THIS LETTER, UH, FOR METROPOLITAN WAS IN ESSENCE TELLING DEPARTMENT OF WATER RESOURCES.
[01:20:01]
YOU NEED TO GIVE ME SOME GUARANTEES THAT YOU ARE GOING TO COMMIT AND DELIVER ON THE STUDIES, ON THE PERMITS, ON THE REVIEW, EVERYTHING NECESSARY TO MARSHAL THIS PROJECT FORWARD SO THAT WE CAN ULTIMATELY MAKE A DECISION AS TO WHETHER TO COMMIT TO THE PROJECT OR NOT.THE NEXT ATTACHMENT THAT I HAVE FOR YOU IS THE RESPONSE FROM THE DEPARTMENT OF WATER RESOURCES.
AGAIN, THIS IS ONLY IF YOU HAVE TROUBLE SLEEPING AT NIGHT, BUT THE RESPONSE FROM THE DEPARTMENT OF WATER RESOURCES WAS INDEED THAT THEY DO COMMIT, UH, WITH THE FULL FORCE OF THE STATE TO MARSHAL THROUGH THE PROJECT ENVIRONMENTAL IMPACT REPORT AND THE NECESSARY PERMIT CONSIDERATIONS IN A TIMEFRAME, THE METROPOLITAN CAN REASONABLY MAKE A DECISION ON THE PROJECT ITSELF.
SO THAT WAS MEANT TO BOLSTER A DECISION THAT IS COMING THIS VERY MONTH BEFORE THE METROPOLITAN BOARD WHETHER TO COMMIT THESE ADDITIONAL MILLIONS OF DOLLARS TO THOSE STUDIES.
THERE'S A LITTLE MORE DETAIL IN THERE, BUT IN THE TIME THAT WE HAVE, I'M GONNA SHORTEN IT FOR YOU.
THE FINAL PIECE OF JUST DATA UPON DATA IS A VERY SIMPLE STATEMENT FROM THE NOTICE FROM DWR TO THE STATE WATER PROJECT CONTRACTORS.
ON THE 5% ALLOCATION, THE STATE WATER CONTRACT EVERY YEAR IS DETERMINED BY THE DEPARTMENT OF WATER RESOURCES TO HAVE AN ESTIMATE OF THE DELIVERIES IT'S GOING TO MAKE.
AND THE PERCENT IS IT TELLS THE CONTRACTORS, I KNOW THAT YOU HAVE A CONTRACTUAL RIGHT TO AMOUNT OF WATER, BUT THIS IS THE PERCENTAGE OF YOUR CONTRACT, RIGHT, THAT I'M WILLING TO GIVE YOU.
IT'S ALWAYS LOW AT THIS TIME OF YEAR.
IT GROWS IN JANUARY AND FEBRUARY AND MARCH AND APRIL AS WE GET MORE AND MORE INFORMATION.
THE POINT OF THIS IS SIMPLY TO NOTE FOR YOU THE TABLE ON THE BACKEND, AND I HIGHLIGHTED FOR YOU TWO CRITICAL AGENCIES.
ONE IS THE KERN COUNTY, UH, WATER AGENCY IN THE SAN JOAQUIN VALLEY, AND ITS CONTRACTUAL RIGHT IS 982,000 ACRE FEET.
THE OTHER ONE IS THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, AND ITS CONTRACTUAL RIGHT IS 1.9 MILLION ACRE FEET.
THERE'S SOME ADDITIONAL THINGS THAT ALLOW IT TO GROW THAT RIGHT, BUT IN ESSENCE 1.9, YOU CAN SEE THAT IF I ADD 0.9 TO THE 1.9, WE'RE TALKING ABOUT 2.8 MILLION ACRE FEET OF CONTRACTUAL RIGHT TO THE STATE WATER PROJECT I OF A TOTAL OF 4.1 MILLION ACRE FEET.
SO AS YOU HEAR MORE AND MORE ABOUT THE DISCUSSION OF THIS STATEWIDE PROJECT AND THE INVESTMENT REQUIRED AND WHY IT IS SO IMPORTANT THAT THE CENTRAL VALLEY PARTICIPATE AND SO IMPORTANT THAT SOUTHERN CALIFORNIA PARTICIPATE, IT'S IMPORTANT FROM THE STANDPOINT THAT THE ONLY WAY TO PAY FOR THOSE IMPROVEMENTS IS BY PROPORTIONAL CONTRACTUAL OBLIGATIONS ON THE STATE WATER CONTRACT.
CONSEQUENTLY, SOUTHERN CALIFORNIA METROPOLITAN ARE CONSIDERED TO BE ESSENTIALLY 50% OF THE OBLIGATION TO THIS STATEWIDE PROJECT IN KERN COUNTY CORRESPONDINGLY.
SO ANOTHER SIGNIFICANT AMOUNT AS WELL.
SO THAT'S IT TO GIVE YOU, UM, A BACKGROUND.
THIS STUFF WILL DEFINITELY COME IN MORE INFORMATION AS DEAN CONTINUES TO DELIVER WATER SUPPLY UPDATES FOR YOU IN THE FUTURE.
UH, BUT IT HIGHLIGHTS FOR YOU A LITTLE BIT OF WHERE DIRECTOR CORDERO IS IN TERMS OF HER WORK AND WHERE SHE WILL FIND HERSELF WITH THE BOARD, UH, METROPOLITAN BOARD DECISION, UH, NEXT WEEK IN TERMS OF THE COMMITMENT TO THOSE STUDIES.
THE OTHER STUFF IS FAIRLY MINOR.
I HAVE THE CALENDAR OF THE BOARD MEETINGS FOR YOU FOR 2025 AND OUR LEGISLATIVE REPRESENTATIVES AT THE FEDERAL LEVEL, CARPI AND CLAY, THEY GIVE US A FEDERAL UPDATE AND THEY HAVE SOME BACKGROUND INFORMATION FOR YOU THERE.
AND THAT CONCLUDES MY, MY ANNOUNCEMENT TO YOU.
OKAY, WE GOT TO MENTION THAT, UM, WE'RE DILIGENTLY TRYING TO PUT TOGETHER A HOLIDAY CELEBRATION AND WE HAVE MANAGED TO DO THAT FOR THE STAFF.
WE'VE TIMED IT TO BE AT THE DECEMBER 19TH BOARD MEETING.
AS WE HEAD INTO LUNCH, WE'RE GONNA HAVE IT OUT HERE IN THE BAY AREA AND WE'RE GONNA GET, UH, ALL THE EMPLOYEES TO JOIN US.
YOU'RE INVITED TO JOIN US AS WELL.
I BELIEVE WE ARE THERE ANY OTHER ANNOUNCEMENTS? SEEING NONE, THE MEETING IS ADJOURNED.
[ADJOURNMENT]
I.