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Home My WebLink About6/20/2017 Item 9, Codron �.� �� Cou�ci l em��orand� �, � DATE; June 19, 2017 TO: Mayor and Council FROM: Michael C�a�� a��, Community Development Director VIA. Katie Lich��,'��.ity Manager SUBJECT: June 20th Council Meeting—Agenda Correspondence Ambient Reimbursement Agreement (Item #9) Following the publication of the Council Agenda Report, staff received and forwarded correspondence to Council from Robbins Reed, one of the development interests located within the Orcutt Area Specific Plan (OASP) and one of the benefitting properties subject to the proposed Reimbursement Agreement. The key issues raised include (1) cost distribution between Projects la (800 LF of 12" ductile iron pipe) and 1 b(1,280 LF of 8" PVC pipe)should be apportioned based on a lineal foot basis, including sharing the telemetry and pressure reducing station over both projects, (2) the Project 3 recycled water line should be the exclusive responsibility of the Jones property, and (3) questioning some of the unit costs used for the detailed cost estimates. Response to Comment#1 Projects la and lb are broken up because they represent distinctly different system improvements, and because they are sized to serve varying demands within each reach. Project la includes a much larger 12" ductile pipe extension, several conversions of existing service laterals and valves for current customers, a significantly more expensive main line gate valve, and the necessary telemetry and PRV improvements for this reach of waterline. Project lb includes a smaller 8" PVC extension, valving and no existing service conversions. Project 1 a would require the PRV and telemetry if Project 1 b were not completed,but to the extent it would also be needed for the 1 b reach, staff believes that during the bidding sequence it would be possible to consider cost savings in areas such as mobilization, traffic control and soft costs if the projects are completed simultaneously. In that instance,staff would be willing to consider a shared distribution between the PRV and telemetry components between the 2 projects. In the end the cost allocation may not follow the more simplistic LF basis suggested by the comment, but a more representative allocation of these costs along these lines can be considered under the terms of the Reimbursement Agreement. Ultimately, Righetti Ranch is eligible to receive remuneration for actual verified costs and not to the estimates shown in the exhibit to the reimbursement agreement. That significant qualifier is a safeguard to ensure that only actual valid costs are eligible for reimbursement. Response to Comment#2 When the OASP was prepared and adopted,the availability and use of recycled water was in its early stages at the City. The options and need for use of recycled water have expanded beyond what was contemplated almost 10 years ago. For the most part, Ambient is exclusively responsible for those portions (i.e. OASP Figure 6.1) referenced by Robbins Reed. To the extent line extensions for recycled water are needed to serve the OASP areas north of Tiburon (former "B" St), it is reasonable that these properties participate in those line extension costs. In the case of Ambient, after covering 100% of their cost to extend recycled Ambient Communities Reimbursement Agreement Agenda Correspondence Page 2 water from Tank Farm to the Central Neighborhood Park,they are extending the line north of C-3 St, along Tiburon and Ranch House Rd to Sponza,to facilitate use on all these properties, including West Creek and Taylor-Muick(now Mangano). Response to Comment#3 The Reimbursement Agreement provides that Ambient will submit three bids for these projects prior to initiating construction of reimbursement-eligible projects. At that time we will have a firmer understanding of the estimated actual unit costs associated with each project. Those bids will be available for public review, and would be the appropriate time to consider the details Robbins Reed is describing. Having worked closely with Ambient and all OASP owners on these matters, staff believes it is in everyone's interest to keep the costs down, and to that extent OASP owners will ultimately benefit from reductions in project costs that will be revisited following completion of each project. It will be staffs role following the completion of any eligible project, to confirm final actual costs, and to then modify the Reimbursement Exhibit A cost allocations accordingly. Additional Note—Proposed Correction The title of Reimbursable Project#3 should read "Recycled Water Main Righetti Ranch Rd from Hayfield Loop to Tiburon Way to Ranch House Rd to Sponza Dr". 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