Questions and Answers on Water From the City of Davis

water-rate-iconEditor’s Note: In advance of tonight’s WAC meeting, members of the WAC submitted questions to staff.  As these questions and answers are provided in the material, they provide a good basis for understanding and discussion.

1. Was the debt service line item included in the Net Present Value total?

Answer: The debt service is not included in the Net Present Value total.  The debt service line included on page 2 is a direct cut and paste from information received from Bartle Wells. Debt service is shown in nominal dollars and was not included in the present worth analysis. Debt service and present worth are independent of one another. Because debt service includes the repayment of principal, if we were to calculate both the net present value of the debt service and the capital project costs we would be double counting the project costs.

2. If the City participates in the JPA until the March 5th election, how much additional money will have been spent?Answer: The budgeted amount through the 3rd quarter of this fiscal year (March 31st), removing any expenditure for local facilities and only paying for the incremental cost of the site fill, is $3,061,700.  This amount is already included in the DWWSP alternatives cost, but is not captured for the West Sacramento Alternative.

3. If Woodland was willing to cost share the treated water pipelines, what is the most Davis could see the cost reduced by?

Answer: Any potential for cost share on the project is a negotiated issue.

4. Is Woodland willing to consider an RFP that has the Operations portion as an option?  Design Build with an option to Operate.

Answer: DBO has been approved as the preferred procurement method by the Agency Board which is comprised of two council members from Davis and two councilmembers from Woodland.  DBO was selected as the preferred procurement method after an extensive evaluation of alternative delivery methods. The evaluation was assisted by a Facilities Procurement Committee comprised of industry experts experienced in project delivery options.  The evaluation process resulted in the FPC recommending DBO as the delivery method that would result in the lowest overall cost and least risk to the Agency.

There is always room for further education and consideration of suggestions regarding how to improve the overall project.  I believe that the Agency Board and the City of Woodland would give all suggestions for improvement serious consideration and would consider adjusting the current plans for procurement as appropriate.

5. What would be the regulatory costs to obtain permits/do CEQA analysis for West Sac option – again additional costs that will be incurred by Davis that need to be added onto the West Sac option?

Answer: The cost of permits and CEQA analysis were estimated in the West Sacramento Alternative cost already.

6. Can we take Doug Dove’s chart on page 7, assume an average consumption that remains the same over time, and for instance set up a table of what a % difference in rate increases in each year would mean to the average rate payer per month in $$$?  Is it $5, or is it more like $50?

Answer: See attached spreadsheet to answer the question.  I can run it out to 2035 if you want.  And/or show NPV too.-Doug (attachment-Water Rate Difference)

7. Question: Looking at Doug Dove’s charts – the Water Bill Comparison, Water and Sewer Bill Comparison, and the Water Bill Comparison NPV – it appears that in the year 2020, when there is the largest difference in rate costs between the Woodland and West Sac project alternatives, for the ratepayer it amounts to only a $20 per month difference.  For $20 per month, the citizens of Davis would have certainty, and will have the added benefit of ozonated water, which tastes better.

Answer: As shown in the attached spreadsheet, the 1/1/2020 rates would vary from $67.47/mo for West Sac to $88.66/mo for the WDCWA Option A (a $21.19/mo difference).  With special financing to delay the impacts, WDCWA Option A would be $70.47/mo or only $3.00/mo difference in 2020.  In the NPV chart, the rates are within $20 as also shown on the attached spreadsheet and the total difference between the 2020 West Sac rate ($59.94) and the 2020 WDCWA Option A rate ($78.77) is only $18.83.-Doug (attachemnet-Inclining Tiers)

8. Question: The difference in costs between the Woodland project and West Sac project is about $21 million, correct?

Answer: (about $21.6 million [$163,649,000 – $142,040,000] according to the 8/9/12 WAC handout from West Yost)

Question: If we go w the West Sac option, Davis will have wasted $3 million, which is an additional cost that needs to be added on to the West Sac option.

Answer: (no, already included)

Question: So now the difference in cost between the two projects is $21 million – $3 million = $18 million.

Answer: (No, $21.6 million)

Question: If Woodland would pay $11 million towards the cost of the pipeline, then the difference in costs between the two projects is $18 million – $11 million = $7 million.

Answer: ($21.6 million – $11 million = $10.6 million)

Question: To the ratepayer, that difference in costs probably would represent less than $5 per month, correct???

[Answer] This depends on which year you look at and what financing assumptions you make.  I would need to have the specific projects that comprise an $11 million Woodland contribution and their timing before I could estimate rate impacts.  -Doug

9. Question: Might there be a delay conferring water rights, e.g. Conaway Ranch rights, if the substance of the project presented is changed, e.g. West Sac option?

Answer: If Davis pursues the Davis-only West Sac option, it will take additional time to secure water rights that allow Davis to (1) secure rights in its name (as opposed to the CWA) and (2) change the point of diversion to the new intake location.  The first step would be to split ownership of the CWA rights into individual rights for Davis and Woodland.  As to the rights associated with Permit 20281, the CWA would file a petition with the State Water Resources Control Board (SWRCB) asking them to split the rights.  This would not require CEQA, a hearing, or a public process, so I expect this could be done in 9 months to a year.  As to the Conaway Ranch rights, the CWA would need to ask the Bureau of Reclamation to split the Settlement Contract into two separate contracts, one for Davis and one for Woodland.  I can’t say for sure how long this would take and what level of NEPA review would be required.   Once the rights are split, the second step would be for Davis to file a petition with the SWRCB asking to change the point of diversion for the Davis rights. CEQA work would need to be completed before the SWRCB would process the petition.  There would likely be protests that would need to be resolved, and there would likely be a hearing before the SWRCB.  As to the Conaway ranch rights, the Settlement Contract would need to be amended to authorize the new point of diversion.  I estimate that it would take 4-6 years to split the rights, perform the additional CEQA analysis, and get a decision from the SWRCB regarding the change in the point of diversion.  This timeline would be extended if there are legal challenges to either the CEQA document or the SWRCB decision, or both.

10. Question:  Are there substantive issues with respect to pipeline path from West Sac, including obtaining necessary easements?

Answer: it depends on the design/construction method we use to get across the Yolo bypass, and where exactly the pipeline would be located. There are some easement and environmental issues that pose some constraints – but nothing we could not overcome. Permitting effort would be defined by the construction method. If it is tunneled through the bypass, than the permitting effort would be similar to what we have now. If not, more challenging, and more mitigation will be needed.

11. Question:  What are the differences in ozonated water versus chlorinated water, especially in regard to taste, and breaking down organic materials contained in the Sac River?

Answer: Ozonated Water vs. Chlorinated Water

Ozone and chlorine are both chemical oxidants, and also act as disinfectants.  Ozone is a much stronger oxidant than chlorine.  The use of ozone as an oxidant in the JPA project would provide primary disinfection of protozoa and viruses, as well as continuous protection against a number of contaminants: emerging chemicals, pharmaceuticals, personal care products, endocrine disruptors, chemicals naturally produced by certain algae and bacteria, and pesticides.  Taste and odor compounds of concern in the Sacramento River include the algae- and bacteria-produced chemicals geosmin and MIB, and the rice pesticide Thiobencarb.  These compounds and the other types of chemicals listed above would be oxidized by ozone and broken into smaller organic components that would be readily biodegraded in biologically active filters.  Ozonated, filtered water would then receive secondary disinfection with chloramines (a more stable disinfectant than chlorine, created by combining chlorine and ammonia).  The stability of chloramines results in much less interaction with organic material that may occur in the finished water distribution system, resulting in lower levels of carcinogenic disinfection byproducts.  Chloraminated water typically carries less of a chlorine taste and/or odor than water that is disinfected with free chlorine.

Without ozone, chlorine would be used as the primary disinfectant.  Without the breakdown and biodegradation of organic material prior to disinfection (as in the ozonated process for the JPA project), the application of free chlorine will result in formation of disinfection byproducts.  Taste and odor compounds would not normally be treated for with chlorine.  In the event that taste and odor compounds are present at detectable human thresholds, powdered activated carbon (PAC) would be applied to remove the compounds, however this protection would only be provided in response to an incident, after an initial period in which taste and odor compounds had already passed through the treatment plant and reached consumers.  PAC would not be added continuously because of the large doses required and the expense of the material.  Water disinfected with free chlorine is more likely to have a chlorine taste and/or odor.

12. Question:  What is the length of the water pipeline from the Woodland plant to where it will join in Davis?  What is the length of water pipeline from the West Sac treatment plant to where it will join in Davis?

Answer: The Davis treated water pipeline associated with the JPA project (JPA pipeline) is 38,600 lineal feet (LF) long, or 7.3 miles, extending from the water treatment plant near Woodland to just south of the photovoltaic facility on Road 102. The Davis treated water pipeline associated with the West Sac alternative (West Sac pipeline) is 49,000 LF long, or 9.3 miles, extending from the West Sacramento treatment plant to Mace Boulevard.

13.  Question:   Describe the methodology as to how the costs of the two pipelines (Woodland plant to Davis and West Sac plant to Davis) were estimated?  Please highlight the similarities and differences between how costs were estimated for both the two pipelines and for estimating the total costs of the entire projects.

1. Answer: Pipeline cost estimates: a. A detailed cost estimate of the JPA pipeline was developed, reflecting study and quantification of the following elements: i. Pipe diameter and pressure classification

ii. Material costs, based on communication with material suppliers

iii. Open cut excavation, backfilling, surplus soil offhauling

iv. Jack and bore crossings

v. Pipe and fitting installation

vi. Pavement restoration

vii. Cathodic protection (for corrosion protection)

viii. Pipeline testing, chlorination and clean up

ix. Estimating contingency (20% of sum of construction subtotal, contractor mobilization and other direct costs, and overhead and profit)

b. The West Sac pipeline was estimated using similar unit costs and design standards to those developed for the JPA pipeline as noted below:  i. Used same general design criteria as JPA pipeline (pipeline sizing, valve spacing, air relief valve spacing, pipe bedding and trench dewatering, etc.).

ii. 36″ pipeline (versus 30″ for the JPA pipeline)

iii. Included jack and bore and horizontal directional drilling for utility crossings

iv. Verified unit costs for some items unique to West Sacramento Alternative

v. Contractor mobilization and other direct costs (2.5% of construction subtotal), same as JPA

vi. Contractor overhead and profit (7.5% of construction subtotal), same as JPA

vii. 35% estimating contingency for the Yolo Bypass crossing and 30% estimating contingency for the pipeline west of the bypass to Davis; these values are greater than JPA due to reduced project definition

2. Total cost estimates for the entire project: a. Total JPA project costs reflect study and quantification of the following elements: i. JPA administration based on known and anticipated costs through project start-up.

ii. Program management based on known and anticipated costs through project start-up.

iii. Water supply including WDCWA/CPG water right permit assignment and BuRec Contract assignment.

iv. Environmental and permitting based on known and anticipated costs through project start-up, excluding environmental mitigation and environmental construction monitoring.

v. Land & Right-of-Way acquisition based on known alignments and site appraisal costs.

vi. Pre-design efforts to determine pipeline alignments and a benchmark treatment process, and to complete the Joint Intake design.

vii. Construction assumes a Design-Build-Operate project delivery method. Costs include DBO design and construction, and include Agency review, CM, engineering services during construction, environmental mitigation, and environmental construction monitoring. Construction costs include a 20% contingency consistent with a Class 3 AACE estimating class as defined by a 10 – 40 percent project completion level.

viii. Agency-requested capital contingency (3 – 5 percent of the annual capital project costs).

ix. Local Woodland and Davis facilities

x. Costs expended by the JPA since 2009

b. Total West Sac project costs are based on the following elements and assumptions: i. Cost estimate for the treatment facilities at Bryte Bend was unique to the West Sacramento Alternative.

ii. Does not include program management, agency administration or capital contingency costs.

iii. Environmental and permitting is based on previous environmental mitigation and management costs provided by ESA.

iv. Land & Right-of-Way acquisition based on easement width and purchase cost assumptions.

v. Engineering, Legal and Administrative includes design, legal, construction management, engineering services during construction, etc. and was estimated at 20% of the regional construction costs.

vi. Local Davis facilities consistent with the JPA project.

vii. A design-bid-build project delivery method.

viii. Construction contingencies ranging from 30% to 35% consistent with a Class 4 AACE estimating class as defined by a 1 – 15 percent project completion level.

ix. Connection fee estimate from West Sacramento (not based on negotiations or discussions with Davis).

x. Costs expended by the JPA since 2009

14. Question:   Although any project is unique, the proposed projects are not without precedent.  Have there been similarly sized water treatment plants and/or pipelines that are currently being constructed or that have been recently completed in the state of California?  What were the costs of these projects?  Are these costs in present value or nominal dollars? (TM Cost Comparison-attached)

Answer: Cost Comparison to Other Projects:

A number of surface water projects have been constructed in central and northern California in recent years, some of which have included relatively large and/or long pipelines.  The attached document presents a brief summary of a comparison of these projects with the JPA project.  Please note that the costs for the JPA project are for a 40-mgd project, and would thus have to be updated for comparison with the current 30 mgd project now being considered.  Current cost estimates for the facilities are lower.  The costs for the comparison projects are assumed to be nominal dollars (from the date of project construction)

15. Question:  Is there any place to see daily water usage for Davis, for each of the 365 days of 2011 and/or 2010?

Answer: No. The daily usage must be calculated by post processing the raw data contained in our SCADA (Supervisory Control And Data Acquisition) system database.

We can provide the daily water usage if requested, most likely in a two day turn-around. The staff person that can conduct the post processing is currently addressing critical operational issues but can begin on this task as soon as possible.

Here are the links to the supplemental material:

Author

Categories:

Budget/Fiscal

30 comments

  1. [quote]Question: If Woodland would pay $11 million towards the cost of the pipeline, then the difference in costs between the two projects is $18 million – $11 million = $7 million.

    Answer: ($21.6 million – $11 million = $10.6 million)[/quote]

    It appears that a Woodland contribution toward the Davis treated water line isn’t figured into the current cost estimate. If that contribution can be finagled, it would significantly tip the cost analysis in favor of 4b.

    I’ve been puzzled by the notion of Woodland subsidizing the Davis treated water line. However, when I consider the siting of the treatment plant to be the result of favorable regional geography — proximity to the proposed intake — rather than a Woodland contribution, the idea of splitting the cost of the two treated water lines becomes plausible. Even if the JPA proposes to buy the plant site from Woodland, that would probably be small change compared to half the cost of the Davis treated water line.

    .

  2. Excellent. We’re these provided by staff or consultants or both? Thanks to WAC members for good questions, detailed answers and David for including them.

  3. Wait a minute… why would Woodland ratepayers subsidize the cost of the trunk from the treatment plant to Davis? Does anyone think that West Sacramento ratepayers will cover some of the costs of a trunk line from there to Davis?

  4. The two situations are very different. West Sac would have no reason to pay for any part of Davis’ treated water line, as its treatment plant is already in place. The JPA, however, could have sited its plant anywhere: in Davis, in Woodland, or somewhere in between. The choice of the Woodland site was probably based on proximity to the intake, thus enabling the JPA to minimize pipe mileage. (The availability of land already owned by one of the partners was a nice plus, but likely not a controlling factor.) Thus it’s not unreasonable for the JPA to consider the treated water mileage to be part of the overall physical plant and divide the cost of same between the two partners.

    Now, if Woodland can only be convinced to see things this way…

    .

  5. [quote]Excellent. We’re these provided by staff or consultants or both? Thanks to WAC members for good questions, detailed answers and David for including them.[/quote]

    Answers were provided by staff and consultants… WAC members had been asked to submit whatever questions they felt they needed answered in order to come prepared tonight. It has been quite a journey 😉

  6. Jim: there are many ways to “split the baby”. Looking at a concept of everything outside the corporate limits of the cities being a joint expense, and apportioned either 50-50 or based on capacity, can be rational and defensible. For all the reasons you cited. That being said, that discussion and agreement would ideally have been reached much earlier in the process. I see no reason why the two entities cannot revisit that concept. However, what is it that would be in Woodland’s best interest, at this point, to increase their share of the costs?

  7. [quote]The two situations are very different. West Sac would have no reason to pay for any part of Davis’ treated water line, as its treatment plant is already in place. The JPA, however, could have sited its plant anywhere: in Davis, in Woodland, or somewhere in between. The choice of the Woodland site was probably based on proximity to the intake, thus enabling the JPA to minimize pipe mileage. (The availability of land already owned by one of the partners was a nice plus, but likely not a controlling factor.) Thus it’s not unreasonable for the JPA to consider the treated water mileage to be part of the overall physical plant and divide the cost of same between the two partners.

    Now, if Woodland can only be convinced to see things this way… [/quote]

    Very well put…

  8. [quote]However, what is it that would be in Woodland’s best interest, at this point, to increase their share of the costs?[/quote]

    To convince us to stay w Woodland rather than deciding the West Sac option is best. It is cheaper for Woodland to do a joint project w Davis than to have to do it alone…

  9. Re: [quote]The availability of land already owned by one of the partners was a nice plus, but likely not a controlling factor[/quote]

    Actually that was a big plus in determining where to put the plant because otherwise a land purchase would have had to be made along with obtaining a slew of easements to bring the inlet pipeline to that new location – all of which would have required millions in expenditures. Another huge consideration was the proximity of the Woodland plant site to the planned RD2035 intake structure. It is basically a straight shot to the proposed plant site. The proposed alternate intake structure (if the joint structure with RD2035 did not work out was miles further to the north and farther away from Davis. This alone would have cost Davis an additional $6M.

    I do not have the total detailed costs but I am betting that if you took the value of the land Woodland donated to the JPA (and the value of the easements) and the fact that Woodland is building their own larger pipeline to Woodland on their own nickel, these collectively would probably come in the same general price range that Davis is going to pay for the pipeline to their own border…be careful what you wish for!

  10. Everyone: remember tonight’s WAC is at the Senior Center, 6:30 pm. I dont know if it will be televised or not. (Can someone bring a video cam and tripod and film it?? Please??)

  11. [quote]The Davis treated water pipeline associated with the West Sac alternative (West Sac pipeline) is 49,000 LF long, or 9.3 miles[/quote]

    I’d be interested in seeing the proposed route, as 9.3 miles seems a mile or so long. Does that route show up on any available documents?

    .

  12. “Why assume a 30″ pipeline for the JPA project and 36” for West Sac? (Question 13, answer 1.b.ii)”[quote]My guess is to make up for the friction loss due to the additional 2 miles or so involved. [b]- Jim Frame[/b][/quote]That occurred to me, but a 44% increase in cross-sectional area seems like a lot to make up for 2 miles of pipeline.

  13. [quote]Elaine. Will it be live TV?
    Can someone respond? Why not CC chambers for such an important mtg?[/quote]

    The Board of Ed was already scheduled that night for the CC Chambers. I do know the meeting will be videotaped at the Senior Center. What I’m not sure of is whether there is the capability of it being live – I doubt it, but I could be wrong.

  14. [quote]Just went on WAC site and don’t see agenda for tonight. Minutes are not at all up to date so did I not go to correct site?[/quote]

    We still have not approved the June 14 minutes, bc there were some errors in them and I was not able to check the video of the meeting since the city’s website was undergoing some changes at the time. All other minutes should be posted prior to June 14.

    The agenda and documents for tonight’s meeting are at the following link:
    [url]http://city-council.cityofdavis.org/on-going-committees/water-advisory-committee/agenda—august-16-2012[/url]

  15. Archived WAC minutes are at the following link:[url]http://city-council.cityofdavis.org/on-going-committees/water-advisory-committee/archived-agendas-and-minutes-as-of-august-1-2012[/url]

  16. ERM: thanks for noting the videotaping. Will that be posted to the web page for clicking and viewing later?

    Im sure there is no way to live broadcast from the Senior Center without huge efforts. I’ve seen it done, but at great expense and complication.

    I think this meeting would justify, but its up to IT and the City Manager.

  17. [quote]Thanks Elaine![/quote]

    You are more than welcome!

    [quote]ERM: thanks for noting the videotaping. Will that be posted to the web page for clicking and viewing later? [/quote]

    In so far as I am aware, yes…

  18. It is 6:41 and there is no sign of the WAC meeting on Channel 16. If someone at the meeting sees this, could you please let the video tech know the signal is not going out? Thanks.

  19. Might KDRT be interested in live radio broadcast in the future of important meetings held somewhere other than the Community Chambers? An audio feed would have been better than nothing today.

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