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01-0701_SOCWA_Addendum 2 to 2nd AmdADDEARM 2 (AWT PILOT PROJECT WORKIPO AMENDMENT NO. 2 to AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 2 ("PC 2 AGREEMENT") (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 2 to Amendment No. 2 ("AWT Amendment") to the PC 2 Agreement is made effective this 3rd day of May, 2007 ("Effective Date"), by and among South Orange County Wastewater Authority ("SOCWA") for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC"); (b) South Coast Water District ("SCWD"); (c) Moulton Niguel Water District ("MNWD"); and (d) Santa Margarita Water District ("SMWD"). SOCWA, SJC, SCWD, MNWD and SMWD are sometimes collectively referred to as the "Parties" in this Addendum 2. RECITALS A. The PC 2 Members entered into the AWT Amendment on June 29, 2000, to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities ("AWT Project") at the Jay B. Latham Plant site. The PC 2 Members whg will fund and thereafter have capacity interests in the AWT Project are SJC, SCWD and MNWD ("PC 2/AWT Members"). B. The PC 2 Members entered into Addendum 1 to the AWT Amendment on October 5, 2006, to revise the project phasing and projected capacities, to provide for the dedication of secondary treated effluent for use by SJC in accordance with the limitations set forth therein, and to authorize the preliminary design and environmental review of the AWT Project. The PC 2/AWT Members have completed the preliminary design and the environmental review for the AWT Project and the project has qualified for Proposition 50 grant funding in the approximate amount of $5,000,000. C. The parties A to execute this Addendum 2 for thefowing purposes: (1) to authorize pilot testing of equipment to determine the appropriate treatment process in connection with the final design of the AWT Project ("Pilot Testing"); and, (2) to authorize field investigation of the Jay B. Latham Plant structure to verify assumptions included in the completed Preliminary Design for the AWT Project ("Field Investigation"). The parties agree as follows: AGREEMENT 1. Testing Investigation Authorization. The PC 2/AWT Members agree SOCWA may proceed with the Pilot Testing and Field Investigation, anticipated at a cost of approximately $261,800, subject to such PC 2's approval of the contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Attachment 1 for such contract(s) and services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 2, within thirty (30) calendar days after the Effective Date above. The projected cost allocation set forth in Attachment 1 is based on the current anticipated capacity interests the PC 2/AWT Members will have in the AWT Project. 2. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 2. Attachment 1 is incorporated into this Addendum 2. 3. Effect of Addendum 2. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the AWT Amendment and Addendum 1 thereto, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No. 2, inclusive of Addendum 1, and this Addendum 2 , the terms of this Addendum 2 shall control. The terms "PC 2 Agreement," "AWT Amendment" and "Addendum 1," as used in such documents, shall include this Addendum 2. 4. Counterparts. This Addendum 2 may be executed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. Page -2- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 0 0 THIS ADDENDUM 2 is entered into by each of the parties as of the Effective Date set forth above. APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Cotinsel - SOCWAA I4 By 'u- v Patricia B. Giannone SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTE 2 By OKairrmah By �/ Secretary PC2IAWT MEMBERS: CITY OF SAN JUAN CAPISTRANO 'M/ Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT By President By Secretary Page -3- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 THIS ADDENDUM 2 is entered into by each of the parties as of the Effective Date set forth above. APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA By Patricia B. Giannone APPROVED AS TO FORM: W(J<l� John Shaw, Agency Cou el BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 By Chairman By Secretary PC2/AWT MEMBERS: By City.'Ce rk MOULTON NIGUEL WATER DISTRICT By President Secretary Page -3- • THIS ADDENDUM 2 is entered into by each of the parties as of the Effective Date set forth above. APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA Patricia B. Giannone SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 By Chairman By Secretary PC2/AWT MEMBERS: CITY OF SAN JUAN CAPISTRANO By Mayor a City Clerk MOULTON NIGUEL WATER DISTRICT Page -3- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Dmft 2 0 SOUTH COAST WATER DISTRICT President By Secretary/Assistant Secretary PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT President/Vice-President Secretary/Assistant Secretary Page -4- BAW&G/PG/J: 118810 17108N2.22 4-10-07 Draft2 9 SOUTH COAST WATER DISTRICT a President/Vice-President Secretary/Assistant Secretary PC 2 MEMBER: SANTA MARC RI ATER DISTRIC By President/Vice-President ByC�.Lt 4U�le d fiL e ret* /Assistant Secretary Page -4- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 ADDENDUM ITO AMENDMENT NO.2 AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO.2 (THE "PC 2 AGREEMENT") (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 1 to Amendment No. 2 to the PC 2 Agreement (hereinafter the "PC 2/AWT Agreement') is made effective this 5"' day of October, 2006 (the "Effective Date"), by and among South Orange County Wastewater Authority ("SOCWA") (the successor in -interest to South East Regional Reclamation Authority (SERRA)), a joint powers agency created by that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority, Orange County, California (SOCWA)" dated July 1, 2001 (the "Joint Powers Agreement"), and pursuant to Section 6500 and following of the Government Code of the State of California, for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC"); (b) South Coast Water District ("SCWD"); (c) Moulton Niguel Water District ("MNWD"); and (d) Santa Margarita Water District("SMWD"). RECITALS A. The PC 2 members entered into the PC2/AWT Agreement to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities (the "AWT Project") at the Jay B. Latham Plant (formerly referred to as the "SERRA Plant', to be referred to as the "Plant" herein) site for the diversion of up to 11.0 mgd of secondary effluent produced at Page -1- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 SD the Plant from discharge to the Pacific Ocean and treatment of such effluent for beneficial reuse as recycled water. The PC 2 Members who will fund, and thereafter have capacity interests in, the AWT Project are SJC, SCWD and MNWD (the "PC 2/AWT Members"). The PC 2/AWT Members desire to have SOCWA resume completion of the preliminary design and environmental review of the AWT Project, to be based upon the revised project phasing and participation as set forth in this Addendum 1. B. The AWT Project will be designed and constructed in one phase with a design capacity of 9.0 mgd, in lieu of the three phases and a design capacity of 11.0 mgd originally contemplated in the PC2/AWT Agreement. SCWD and MNWD plan to own and use less capacity in the AWT Project than originally set forth in the PC2/AWT Agreement, and SJC plans to own and use more capacity in the AWT Project then originally set forth in the PC 2/AWT Agreement. PC 2/AWT Member's currently contemplated capacities in the AWT Project are as follows: SCWD- 0.5 mgd; MNWD- 1.5 mgd; and, SJC- 7.0 mgd, for a total of 9.0 mgd in the AWT Project. C. Based on the `[SERRA]Jay B. Latham Plant Wastewater Capacity Allocations' set forth in the PC 2 Agreement, SCWD and MNWD will have excess secondary treated effluent available even after their participation in the AWT Project at the revised AWT capacity interests set forth in this Addendum 1, which otherwise will be discharged to the Pacific Ocean. SMWD will not participate in the AWT Project and the secondary treated effluent related to SMWD's wastewater capacity allocation and wastewater flows actually sent to the Plant by SMWD are discharged to the Pacific Ocean. Pursuant to this Addendum 1, SJC desires to secure assurances from MNWD,SCWD and SMWD that SJC may take if available a quantity of secondary treated effluent generated at the Plant sufficient to support the projected recycled water production resulting from SJC's capacity interest(s) in the AWT Project, subject to the forty year term on such assurances provided for hereafter. Page -2- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft I D. The PC 2/AWT Members (SIC, SCWD and MNWD) have reviewed alternative treatment processes for the AWT Project. In order to complete the environmental review and the preliminary design for the AWT Project in a timely fashion so as to qualify for potential California State Proposition 50 grant funding in the magnitude of $5,000,000, the PC 2 Members desire to execute this Addendum 1 for the following purposes: (1) revise the project phasing and projected capacities of the PC 2/AWT Members previously set forth in PC 2/AWT Agreement; (2) provide for MNWD's ,and SCWD's consent to use of the available secondary treated effluent not otherwise needed by MNWD and SCWD to fully utilize their own respective capacities in the AWT Project, as well as SMWD's consent, to allow use of the available effluent by SJC in conjunction with its capacity in the AWT Project; and, (3) authorize the preliminary design and environmental review of the AWT Project in a timely manner so as to qualify for potential Proposition 50 grant funds, if and when such funds are available, and to otherwise authorize the funding of such design and environmental services. AGREEMENT The parties agree to revise the PC 2/AWT Agreement, including those certain sections of thereof as noted, as follows: 1. Revised Section 1B "Project Phases". Section 113, Table 2, which sets forth the proposed capacities of each PC 2/AWT Member in the project facilities, is amended to be as follows: AWT PROJECT CAPACITIES (PROJECTED) TABLE 2 PC 2/AWT AWT Project Capacity Member Capacity (mgd) Share Page -3- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 0 SJC 7.0 77.780, MNWD 1.5 16.670 SCWD .5 5.56' 0 TOTAL 9.0 100.00% 2. Environmental Review, Preliminary Design. The PC 2/AWT Members agree SOCWA may proceed with the environmental review and the preliminary design of the AWT Project as revised by the terms of this Addendum 1, subject to the members' approval of the environmental services and design services contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Exhibit D (which Exhibit D will supercede the costs previously allocated to the members for preliminary design in Exhibit C to the PC 2/AWT Agreement)for the preliminary design and environmental review services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 1, within sixty (60) calendar days after the Effective Date of this Addendum 1. 3. Revised Section 2B. Section 213, "Funding Opportunities: Withdrawal", is amended as follows: "Section 2B. Funding Opmortunities: Withdrawal. Upon request by any PC 2/AWT Member, and at any such member's individual expense, SOCWA will pursue funding opportunities from available state or federal sources/programs for the AWT Project at the earliest possible date. Page -4- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft I It is agreed by the parties to this Amendment No. 2 that, subsequent to the completion of the preliminary design and environmental review, but prior to the award of a -the final design contract for the AWT Project, any PC 2/AWT Member may withdraw from participation in the AWT Project. In the case of a withdrawal, all further obligations of the withdrawing member shall cease as of the date of such withdrawal, except obligations of that member for expenses already incurred pursuant to this Amendment No. 2. Subject to the further approvals by the PC 2/AWT Members prior to Final Design and construction, the AWT Project shall be constructed and thereafter owned, operated, and maintained by SOCWA, through, on behalf of, and for the use and benefit of, the remaining PC 2/AWT Members." 5. Effluent Surplus. SMWD, MNWD and SCWD each agree that SJC may use effluent flows from, respectively, SMWD, MNWD and SCWD, delivered to the Plant, but, in the case of MNWD and SCWD, only to the extent that such effluent flows exceed the levels required for, respectively, MNWD's and SCWD's AWT Project capacities (collectively hereinafter,"Surplus Effluent"). SMWD, MNWD, SCWD each will allow the use of its Surplus Effluent (hereinafter individually, the "SMWD Effluent", the "MNWD Surplus Effluent" and the "SCWD Surplus Effluent) by SJC for such specific purpose, subject to the following conditions: (a) SJC's use of the Surplus Effluent will be deemed used on a proportionate basis as to the SMWD Surplus Effluent, the MNWD Surplus Effluent and the SCWD Surplus Effluent. Notwithstanding any other term set forth herein, SJC agrees that SMWD, MNWD and SCWD make no promises, assurances or guarantees that they will individually or collectively deliver sufficient wastewater flows to the Plant so that the Surplus Effluent will continue to be available, or available in any specific quantity, for SJC's use in connection with the AWT Project as provided in Amendment No. 2, as supplemented by this Addendum 1. (b) SJC's use of the Surplus Effluent is restricted for use by SJC in connection with SJC's 7.0 mgd capacity in the AWT Project, and for no other purpose unless otherwise agreed to Page -5- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 in writing by SMWD,MNWD, SCWD and SJC, and approved by Project Committee No. 2, if required. (c) In recognition of SJC's necessity for the Surplus Effluent to fully utilize its AWT Project capacity and therefore benefit from investment in its recycled water program, SMWD, MNWD and SCWD each agree to enter into timely good -faith discussions with SJC for purposes of determining if a permanent reduction in Surplus Effluent can be avoided should SMWD, MNWD or SCWD decide in the future to develop any facilities which will reduce the amount of wastewater delivered to the Plant and therefore impact the Surplus Effluent necessary for SJC to utilize its capacity in the AWT Project. (d) Notwithstanding any other term set forth in this Addendum 1, the consent given by SMWD, SCWD and MNWD to SJC's use of the Surplus Effluent, including the requirement set forth in subsection (d) of this Section 5, will terminate on a date forty (40) years from the Effective Date, unless otherwise agreed to in writing by the parties hereto. Upon expiration of such consent, SIC shall be limited to the quantity of effluent generated at the Plant resulting from wastewater flows conveyed to the Plant by SJC, unless or until otherwise agreed by the parties. 6. Substitution of SOCWA. All references to "SERRA" set forth in the PC 2/AWT Agreement are deemed to be references to SOCWA, as SERRA's successor -in -interest. 7. Delete CGvL Report The parties agree that the CGvL Report will not be incorporated as Attachment 1 in the PC 2/AWT Agreement. 8. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 1. Exhibit D is attached and incorporated into this Addendum 1. Page -6- BAW&GiPGAp178800 17005 N 2.22- 6-11-06 Draft 1 9. Effect of Addendum 1. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the PC 2/AWT Agreement, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No.2 , the terms of this Addendum 1 shall control. The terms "PC 2 Agreement" and "PC 2/AWT Agreement" as used in such documents shall include this Addendum 1. 10. Counterparts. This Addendum 1 may be executed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. [Remainder of this page blank] Page -7- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 r� L n U THIS ADDENDUM 1 is entered into by each of the parties as of the Effective Date above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO.2 v (� By2 Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Co el - SOCW By 6��— Patricia B. Giannone Page -8- BAW&G/PG/kp/75800 17005 N 2.22- 7-12-06 Dmft 2 APPROVED AS TO FORM: John W. Shaw, City Attorney PC2/AWT MEMBERS: CITY OF SAN JUAN CAPISTRANO LE MOULTON NIGUEL WATER DISTRICT 0 President By Secretary SOUTH COAST WATER DISTRICT .0 19 PresidentlVice-President Secretary/Assistant Secretary Page -9- BAW&G/PG/kp/78800 17005 N 2.22- 7-12-06 Draft 2 0 1 1 0 ATTEST: Margaret R. Monahan, City Clerk APPROVED AS TO FORM: John R. Shaw, City Attorney PC2/AWT MEMBERS - CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT President By ecretary SOUTH COAST WATER DISTRICT I� Uz President/Vice-President Secretary/Assistant Secretary Page -9- BAW&G/PG/kp/78800 17005 N 2.22- 7-12-06 Draft 2 ATTEST: Margaret R. Monahan, City Clerk APPROVED AS TO FORM: John R. Shaw, City Attorney PC2/AWT MEMBERS: CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT President Secretary SOUTH COAST WATER DISTRICT By 'Xe S i dent/n�1.ee Asident t By %yX • N ulr Secretary/Assistant Secretary Page -9- BAW&G/PG/kp/78800 17005 N 2.22- 7-12-06 Draft 2 0 PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT By �'-flresider�t ke=Presldenf By�VVc, �/dtlr�4t�r— Se re Assistant Secretary Page -10- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 0 AMENDMENT NO. 4 E AGREEMENT FOR ACQUISITION OF CAPACITY, CONSTRUCTION, USE, OPERATION, AND MAINTENANCE OF OUTFALL FACILITIES FOR SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 5 ("PC 5 AGREEMENT") This Amendment No. 4 to the PC 5 Agreement is effective as of the 5th day of October, 2006 ( "Effective Date"), by and between South Orange County Wastewater Authority (SOCWA), a joint powers authority under Government Code Section 6500 et seg. and that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority Orange County, California (SOCWA) and Terminating Aliso Water Management Agency, South East Regional Reclamation Authority, South Orange County Reclamation Authority" dated July 1, 2001, ( "Joint Powers Agreement') and the following member agencies of SOCWA and its Project Committee No. 5: (a) City San Clemente (CSC); (b) City San Juan Capistrano (SJC); (c) Moulton Niguel Water District (MNWD); (d) Santa Margarita Water District (SMWD); and (e) South Coast Water District (SC WD). SOCWA is the successor -in -interest to the South East Regional Reclamation Authority under the PC 5 Agreement and for all other purposes. The foregoing entities are in some instances referred to individually as the "PC 5 Member" or collectively as the "PC 5 Members", which term is also defined to include all predecessors -in -interest to the individual PC 5 Members, as applicable, or individually as "party" and collectively or in combination as "parties". The parties are member agencies of SOCWA and Project Committee No. 5, and are signatories to the Joint Powers Agreement. RECITALS A. SOCWA is pursuing in the most beneficial economically and environmentally compatible manner, a regional program for wastewater collection, treatment, reclamation, reuse, disposal and management, including but not limited to that facility known as the SOCWA San Juan Creek Ocean Outfall ( "SJCO Outfall'). Project Committee No. 5 was previously created for the purpose of constructing and operating the SJCO Outfall, all in accordance with the PC 5 Agreement. M �J B. SERRA and the PC 5 Members previously executed the PC 5 Agreement, dated August 18, 1977, as well as the November 10, 1977 Addendum, the March 10, 1988 Amendment No. One, the March 14, 1991 Amendment No. Two and the February 7, 2002 Amendment No. 3, thereto. The term "PC 5 Agreement" as used in this Amendment No. 4 shall include the 1977 Agreement referenced above and the 1977 Addendum, 1988 Amendment No. One, 1991 Amendment No. Two, 2002 Amendment No. 3 and this Amendment No. 4 upon approval and execution thereof. C The capacity ownership percentages of the PC 5 Members in the SJCO Outfall are set forth in the PC 5 Agreement, as follows: City of San Clemente (CSC) - 16.62% City of San Juan Capistrano (SJC) - 11.08% Moulton Niguel Water District (MNWD) - 15.51% Santa Margarita Water District (SMWD) - 44.32% South Coast Water District (SCWD) - 12.47% D. Pursuant to 2002 Amendment No. 3, the PC 5 Members agreed that, for all purposes, the design capacity of the SJCO Outfall is 80 mgd Peak Flow. This capacity of 80 mgd Peak Flow was based on the PC 5 Members' review and evaluation of the Wm. Lea Fisher report entitled "SERRA Outfall and Pump Station Capacity Evaluation and Cost Allocation Report," dated May 1, 1990, as supplemented by Fisher's report entitled "SERRA Outfall Pressure Rating," dated January 28, 1991. Based on the ownership percentages in Recital E above, the capacity interests of each PC 5 Member in the total 80 mgd Peak Flow SJCO Outfall capacity was agreed as follows: CSC 16.62% 13.30 mgd Peak Flow SJC 11.08% 8.86 mgd Peak Flow MNWD 15.51% 12.41 mgd Peak Flow SMWD 44.32% 35.46 mgd Peak Flow SCWD 12.47% 9.97 mgd Peak Flow E. The current SOCWA National Pollution Discharge Elimination System (NPDES) Permit (San Diego Regional Water Quality Control Board Order No. R9-2006-0054, NPDES No. CAO 107417, expiration date October 1, 2011) for the SJCO Outfall ("SJCO NPDES Permit") permits a calendar -monthly average effluent daily flow rate limitation of 36.385 million gallons per day (mgd), as may be modified from time -to -time, which limitation applies to the PC 5 Members' use of permitted flows on an aggregate basis under such permit terms. 2 BAWG/I 12468v2 17108 N 10 8-29-06 i F. PC 5 Member CSC has developed an urban water management plan to improve water quality at CSC's beaches and the surf zone. CSC's Segunda Desheca (M02) Flood Control Channel ("Segunda Desheca Channel") is one of CSC's primary drainage facilities, and discharges flows onto North Beach and directly into the ocean. CSC is undertaking its "Segunda Desheca Channel Urban Runoff Diversion Project" ("Diversion Project") that will result in projected dry weather flows of approximately 1.5 cfs (1 mgd) of filtered urban runoff flows ("Runoff Discharge") through CSC's Land Outfall, with ultimate disposal to the SJCO Outfall. G. The PC 5 Agreement does not specifically contemplate or expressly permit urban runoff discharges through the SJCO Outfall in lieu of secondary effluent discharge nor the use of the SJCO Outfall capacity for such purposes, and specifically does not permit the proposed CSC Runoff Discharge. SOCWA, in conjunction with CSC, has submitted an application for an amendment to the SJCO NPDES Permit to provide for the Runoff Discharge from the CSC Diversion Project ("Permit Amendment"), as set forth in that certain application for amendment to the SJCO NPDES Permit to Region 9, dated June 27, 2005. H. Under the original PC 5 Agreement, each PC 5 Member covenants that it will not deliver any discharge to the SJCO Outfall that will directly or indirectly, or in combination with any other material or substance delivered to the SJCO Outfall, prevent SOCWA from complying with the SJCO NPDES Permit, as amended from time to time. Further, the 1988 Amendment No. One requires certain PC 5 Member's individual discharges to meet the effluent limits set forth in the SJCO NPDES Permit, with possible liquidated damages for any violating discharges. I. Project Committee No. 5, at the request of CSC, desires to approve and execute this Amendment No. 4 in order to permit the Diversion Project to continue on the currently contemplated schedule, which has a 2007 project completion date, subject to the terms and conditions and limitations set forth in this Amendment No. 4 that recognize the use of CSC's capacity in the SJCO Outfall capacity for disposal of the Runoff Discharge. NOW, THEREFORE, the parties, in consideration of the mutual covenants and conditions set forth in this Amendment No. 4, agree as follows: AGREEMENT Section 1. Subject to possible limitations set forth in this Amendment No. 4 and in the PC 5 Agreement, the PC 5 Members acknowledge that member CSC may use its' capacity ownership in the SJCO Outfall for discharging the Runoff Discharge instead of secondary effluent, BAWG/112468v2 17108 N 10 8-29-06 0 0 contingent upon compliance with all covenants and terms and conditions in this Amendment No. 4, the PC 5 Agreement, the SJCO Outfall NPDES Permit, including the contemplated Amendment thereto for the Diversion Project, and any other applicable permits, rules, regulations, etc., as such documents and regulations may be amended in the future. These terms and conditions include, but are not limited to, discharge rate, dilution and constituents concentration concerns, or future TMDLs imposed relative to any discharge from the SJCO Outfall. The Runoff Discharge ultimately disposed through the SJCO Outfall will be required to be metered and monitored by CSC at appropriate locations as determined by the SOCWA General Manager or his designee to ensure there are no adverse impacts to the waste discharge requirements applicable to the SJCO Outfall or under the SJCO Outfall NPDES Permit, or any other applicable permits, laws, rules or regulations. Section 2. PC 5 Member CSC further convenants that it will not deliver to the SJCO Outfall any Runoff Discharge which directly or indirectly, or in combination with any other material or substance delivered to the SJCO Outfall by the other parties, will prevent SOCWA from complying with the waste discharge or other requirements established in the SJCO Outfall NPDES Permit or the provisions thereof, as amended from time to time. In the event that CSC's Runoff Discharge violates the covenants above, CSC shall pay any costs directly or indirectly resulting from such violation(s), including (i) all costs of ascertaining and establishing the violation; (ii) fines and penalties, including but not limited to mandatory minimum penalties imposed by the California Regional Water Quality Control Board - San Diego Region ( "Region 9"); (iii) all engineering, accounting, administrative, and legal costs; and, (iv) any increased operating, maintenance and replacement or repair costs. Section 3. To the extent the Runoff Discharge to the SJCO Outfall causes or results in operative impacts to the SJCO Outfall, resulting in added costs, CSC will appropriately compensate the PC 5 Members on a proportionate flow basis. The issue of operative impacts as described in this section will first be evaluated by SOCWA commencing on a date one (1) year after commencement of operation of the Diversion Project. Section 4. Notwithstanding any other term in this Amendment No. 4, nothing in this Amendment No. 4 is intended to be a waiver, modification or alteration of the capacity ownership of the PC 5 Members in the SJCO Outfall under the PC 5 Agreement. Section 5. CSC agrees to fund, or reimburse, all SOCWA staff time, and any engineering, legal and other costs associated with Project Committee No. 5's consideration of the Diversion Project and Runoff Discharge matters discussed in this Amendment No. 4. These costs include the costs of preparation and review of this Amendment No. 4 and the Permit Amendment; 4 BAWG/11246842 17108 N 10 8-29-06 0 L] provided, each individual Project Committee No. 5 Member Agency will fund its own separate costs, if any, relative to review and approval of such documents and related issues. CSC further agrees to fund any future Project Committee No. 5 costs associated with or required to review permit or regulatory terms or other matters relative to the proposed Diversion Projects or Runoff Discharge. Section 6. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Amendment No. 4. This Amendment No. 4 may be executed in one or more counterparts, each of which will be deemed an original. Section 7. Except as may be modified in this Amendment No. 4, all other terms and conditions of the PC 5 Agreement shall remain in full force and effect. In the event of any conflict or inconsistency between the PC 5 Agreement and this Amendment No. 4, the terms of this Amendment No. 4 shall control. above. Section 8. This Amendment No. 4 shall be effective as of the Effective Date defined THIS AMENDMENT NO.4 to the PC 5 Agreement is entered into by each of the parties as of the Effective Date defined above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY Opl-�EHALF OF PROJECT COMMTJ1Ts&NO./ 5. By ��Y�-•�i^�r� Secretary APPROVED AS TO FORM: BOWIE, AkNESON, WILES & GIANNONE Legal Co sek- SO BY i Patricia B. Giannone BAWG/112468v2 17108 N 10 8-29-06 ByMayork.-� Cil?, CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT By President By Secretary SANTA MARGARITA WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary SOUTH COAST WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary 6 BAWG/112468v2 17108 N 10 8-29-06 7 CITY OF SAN CLEMENTE By By Mayor City Clerk CITY OF SAN JUAN CA By May9r MOULTON NIGUEL WATER DISTRICT By President By Secretary SANTA MARGARITA WATER DISTRICT President/Vice President By Secretary/Assistant Secretary SOUTH COAST WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary 6 BAWG/112468v2 17108N 10 8-29-06 CITY OF SAN CLEMENTE By Mayor By City Clerk CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL W ER DIS CT B resident By ee e y SA A MARGARITA WATER DISTRICT President/Vice President Secretary/Assistant Secretary SOUTH COAST WATER DISTRICT Lm BAWG/112468v2 17108 N 10 8-29-06 President/Vice President Secretary/Assistant Secretary CITY OF SAN CLEMENTE By Mayor By City Clerk CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT By President By Secretary SANTA ARGARITA WATER DISTRICT By reside ice President By Secretary/Assistant Secretary SOUTH COAST WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary 6 BAwG/112468v2 17108 N 10 8-29-06 CITY OF SAN CLEMENTE By Mayor By City Clerk CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT By President By Secretary SANTA MARGARITA WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary SOUTH COAST ATER DISTRICT By Pr entJVicelfresident By Secretary/Assistant Secretary 6 BAWG/112468v2 17108 N 10 8-29-06 AMENDMENT NO. 3 AGREEMENT FOR ACQUISITION OF CAPACITY, CONSTRUCTION, USE, OPERATION, AND MAINTENANCE OF OUTFALL FACILITIES FOR SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 5 ("PC 5 AGREEMENT") This Amendment No. 3 to the PC 5 Agreement is effective as of the 7th date of February, 2002 (the "Effective Date"), by and between South Orange County Wastewater Authority (SOCWA), a joint powers authority under Government Code Section 6500 et seq. and that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority Orange County, California (SOCWA) and Terminating Aliso Water Management Agency, South East Regional Reclamation Authority, South Orange County Reclamation Authority" dated July 1, 2001, (the "Joint Powers Agreement') and the following member agencies of SOCWA and its Project Committee No. 5: (a) City San Clemente (CSC); (b) City San Juan Capistrano (SJC); (c) Moulton Niguel Water District (MNWD); (d) Santa Margarita Water District (SMWD); and (e) South Coast Water District (SCWD). SOCWA is the successor -in -interest to the South East Regional Reclamation Authority under the PC 5 Agreement and for all other purposes. The foregoing entities are in some instances referred to individually as the "PC 5 Member" or collectively as the "PC 5 Members", which tern is also defined to include all predecessors -in -interest to the individual PC 5 Members, as applicable, or individually as "party" and collectively or in combination as "parties". The parties are member agencies of SOCWA and Project Committee No. 5, and are signatories to the Joint Powers Agreement. RECITALS A. SOCWA is pursuing in the most beneficial economically and environmentally compatible manner a regional program for wastewater collection, treatment, reclamation, reuse, disposal and management, including but not limited to that facility known as the SOCWA San Juan Creek Ocean Outfall (the "PC 5 Outfall") . Project Committee No. 5 was previously created for the purpose of constructing and operating the PC 5 Outfall, all in accordance with the PC 5 Agreement. B. SERRA and the PC 5 Members previously executed the PC 5 Agreement, dated August 18, 1977, as well as the November 10, 1997 Addendum, the March 10, 1988 Amendment No. One and the March 14, 1991 Amendment No. Two, thereto. The term "PC 5 Agreement" as used in this Amendment No. 3 shall include the 1977 Agreement referenced above and the 1977 Addendum, 1988 Amendment No. One, 1991 Amendment No. Two, and this Amendment No. 3 upon approval and execution thereof. C. PC 5 Member SJC is undertaking a desalter project that will result in an associated brine discharge. SJC has proposed to discharge the brine through SMWD's Chiquita Land Outfall, which ultimately discharges to the PC 5 Outfall. aAW&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft#1 D. PC 5 Member SCWD is considering construction of a similar desalter project, and proposes to discharge the brine to the Chiquita Land Outfall or directly to the PC 5 Outfall. E. Both SJC and SCWD own capacity in the PC 5 Outfall pursuant to the PC 5 Agreement along with the other PC 5 Members. The capacity ownership percentages of the PC 5 Members in the PC 5 Outfall are set forth in the PC 5 Agreement, as follows: City of San Clemente (CSC) 16.62% City of San Juan Capistrano (SJC) 11.08% Moulton Niguel Water District (MNWD) - 15.51% Santa Margarita Water District (SMWD) - 44.32% South Coast Water District (SCWD) 12.47% F. The current SOCWA National Pollution Discharge Elimination System (NPDES) Permit (San Diego Regional Water Quality Control Board Order No. 2000-13; expiration date of February 19, 2005) for the PC 5 Outfall permits average dry weather flows (ADWF) of not -to - exceed 30 million gallons per day (ingd), which total mgd ADWF limitation, as may be modified from time -to -time, applies to the PC 5 Members' use of permitted flows on an aggregate basis under the permit terms. G. The PC 5 Agreement does not specifically contemplate or expressly permit brine discharges in lieu of secondary effluent discharge, nor the use of the PC 5 Outfall capacity for such purposes. BAW&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft # 1 3 171 H. Under the original PC 5 Agreement, each PC 5 Member covenants that it will not deliver any discharge to the PC 5 Outfall that will directly or indirectly, or in combination with any other material or substance delivered to the PC 5 Outfall, prevent SOCWA from complying with the PC 5 Outfall NPDES Permit, as amended from time to time. Further, the 1988 Amendment No. One requires certain PC 5 Member's individual discharges to meet the effluent limits set forth in the PC 5 Outfall NPDES Permit, with possible liquidated damages for any violating discharges. The PC 5 Outfall NPDES Permit recognizes the brine discharges of SIC and SCWD discussed above, and establishes effluent limitations under brine discharge conditions. J. On February 7, 2002, Project Committee No. 5, at the request of SIC, adopted Resolution No - 02, entitled " Resolution of the Board of Directors of South Orange County Wastewater Authority (Project Committee No. 5/San Juan Creek Ocean Outfall) Setting Forth Terms and Conditions For Approval Of Brine Discharge To PC 5 Outfall" (the "Policy Resolution"), and now desires to approve and execute this Amendment No. 3 in order to contractually memorialize the policies and intentions set forth in the Policy Resolution. The purpose of this Amendment No. 3 is to permit SIC's and/or SCWD's respective desalter projects to continue on the currently contemplated schedules, which have 2003 project completion dates, subject to the terms and conditions and limitations set forth in this Amendment No, 3 and the PC 5 Agreement that recognize the use of PC 5 Outfall capacity for brine discharge. NOW, THEREFORE, the parties, in consideration of the mutual covenants and BAW&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft HI 0 conditions set forth in this Amendment No. 3, agree as follows: AGREEMENT Section 1. In order for the PC 5 Members to adequately address any PC 5 Outfall capacity issues that could be affected by the use of the PC 5 Outfall for brine discharge, or otherwise, the PC 5 Members agree that, for all purposes, the design capacity of the PC 5 Outfall is 80 mgd Peak Flow. This capacity of 80 mgd Peak Flow is based on the PC 5 Members' review and evaluation of the Win. Lea Fisher report entitled "SERRA Outfall and Pump Station Capacity Evaluation and Cost Allocation Report", dated May 1, 1990, as supplemented by Fisher's report entitled "SERRA Outfall Pressure Rating", dated January 28, 1991. Based on the ownership percentages in Recital E above, the capacity interests of each PC 5 Member in the total 80 mgd Peak Flow PC 5 Outfall capacity is set forth as follows: CSC 16.62% 13.30 mgd Peak Flow SJC 11.08% 8.86 mgd Peak Flow MNWD 15.51% 12.41 mgd Peak Flow SMWD 44.32% 35.46 mgd Peak Flow SCWD 12.47% 9.97 mgd Peak Flow Section 2. Subject to possible limitations set forth in this Amendment No. 3 and in the PC 5 Agreement, the PC 5 Members acknowledge that members SIC and/or SCWD may each use their respective capacity ownership in the PC 5 Outfall for discharging brine instead of BA W&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft NI 0 0 secondary effluent, contingent upon compliance with all covenants and terms and conditions in this Amendment No. 3, the PC 5 Agreement, the PC 5 Outfall NPDES Permit and any other applicable permits, rules, regulations, etc., as such documents and regulations may be amended in the future. These terns and conditions include, but are not limited to, discharge rate, dilution and constituents concentration concerns, or future TMDLs imposed relative to any discharge from the PC 5 Outfall. The brine discharges ultimately disposed through the PC 5 Outfall will be required to be metered and monitored by SIC and SCWD at appropriate locations as determined by the SOCWA General Manager or his designee to ensure there are no adverse impacts to the waste discharge requirements applicable to the PC 5 Outfall or under the PC 5 Outfall NPDES Permit, or any other applicable permits, laws, rules or regulations. Section 3. PC 5 Members SIC and SCWD each further convenants that it will not deliver to the PC 5 Outfall any brine discharge which directly or indirectly, or in combination with any other material or substance delivered to the PC 5 Outfall by the other parties, will prevent SOCWA from complying with the waste discharge or other requirements established in the PC 5 Outfall NPDES Pennit or the provisions thereof, as amended from time to time. In the event that either such PC 5 Member's brine discharge violates the covenants above, the PC 5 Member in question shall pay any costs directly or indirectly resulting from such violation(s), including (i) all costs of ascertaining and establishing the violation; (ii) fines and penalties, including but not limited to mandatory minimum penalties imposed by the California Regional Water Quality Control Board- San Diego Region; (iii) all engineering, accounting, administrative, and legal costs; and, (iv) any increased operating, maintenance and replacement or repair costs. BAW&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft 41 Section 4. To the extent brine discharges to the PC 5 Outfall cause or result in operative impacts to the effluent purnp station located at SOCWA's Jay B. Latham Plant, resulting in added pumping costs, the PC 5 Members discharging brine will appropriately compensate the SOCWA Members owning capacity in the pump station on a proportionate flow basis. The issue of operative impacts as described in this section will first be evaluated by SOCWA commencing on a date one (1) year after commencement of operation of the earlier of the SJC or SCWD desalter project. Section 5. Upon the earlier of (1) the date of any PC 5 Outfall NPDES Permit term expiration (or such tithe in advance of that expiration date reasonably necessary to process renewal by such expiration date) or, (2) a point in time when the ADWF flows through the PC 5 Outfall equal 80% of the permitted capacity ("permit renewal"), PC 5 will initiate permit renewal. The costs for permit renewal shall be allocated to and paid by the PC 5 Members in proportion to their actual mgd ADWF flows through the PC 5 Outfall at that applicable time, which is consistent with SOCWA's current practice. Section 6. For any period of time in which the permitted flow limit under the PC 5 Outfall NPDES Permit is not less than 30 mgd ADWF (i.e. current PC 5 Outfall NPDES Permit limit), all PC 5 Members' flows through the PC 5 Outfall will be on an aggregate basis, and the permitted capacity may be used by the PC 5 Members accordingly. Notwithstanding any other term in this Amendment No. 3, nothing in this Amendment No. 3 is intended to be a waiver, modification or alteration of the capacity ownership of the PC 5 Members in the PC 5 Outfall under the PC 5 Agreement. BAW&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft#1 0 0 Section 7. PC 5 Members SJC (and SCWD, if applicable) each agree to fund, or reimburse, all SOCWA staff time, and any engineering, legal and other costs associated with Project Committee No. 5's consideration of the desalter projects and brine discharge matters discussed in this Amendment No. 3. These costs include the costs of preparation and review of the Policy Resolution and this Amendment No. 3; provided, each individual Project Committee No. 5 Member Agency will fund its own separate costs, if any, relative to review and approval of such documents and related issues. SJC and SCWD each further agree to fund any future Project Committee No. 5 costs associated with or required to review permit or regulatory terms or other matters relative to the proposed desalter projects or brine discharge. Section 8. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Amendment No. This Amendment No. 3 may be executed in one or more counterparts, each of which will be deemed an original. Section 9. Except as may be modified in this Amendment No. 3, all other terms and BAW&G/PG/kp/79599 17108 N 5.1 1/23/02 Draft 41 conditions of the PC 5 Agreement shall remain in full force and effect. In the event of any conflict or inconsistency between the PC 5 Agreement and this Amendment No. 3, the terms of this Amendment No. 3 shall control. THIS AMENDMENT NO.3 to the PC 5 Agreement is entered into by each of the parties as of the Effective Date defined above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 5. B a rman By a4e %149 Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA Y atricia B. Giannone Approved as to form ) ty ttorney BAW&G(PGlkp/79599 17108 N 5.11/23/02 Draft #1 CITY OF SAN CLEMENTE BYL — r By City Clerk,.'; ,1 0 0 CITY OR SAN JUAN CAPISTRANO B, Y Mayor : Diane Bathga e By / ` Ci v erk : Margaret R. Monahan MOULTON NIGUEL WATER DISTRICT Chairman By Secretary SANTA MARGARITA WATER DISTRICT QI President(Vice President By Secretary/Assistant Secretary BAW&G/PG4ng599 17108 N 5.11/23/02 Draft #1 CITY OF SAN JUAN CAPISTRANO Mayor City Clerk MOULTON NIGUEL WATER DISTRICT BVD., ChA rman v By cr tary SANTA MARGARITA WATER DISTRICT President/Vice President Secretary/Assistant Secretary BAW&G/PG/kpng599 17108 N 5.1 123/02 Draft #1 0 4 CITY OF SAN JUAN CAPISTRANO Mayor City Clerk MOULTON NIGUEL WATER DISTRICT By Chairman By Secretary By SGc tart' M4Aeitt Secretary BAW&G/PG4R9599 17108 N 5.1 1123/02 Draft #1 i 0 SOUTH COAST WATER DISTRICT � l 14.1 MINE, - By i"V Secretary/Assistant Secretary BAW&G/PGApn9599 17108 N 5.1 123/02 Draft #1 JOINT EXERCISE OF POWERS AGREEMENT CREATING SOUTH ORANGE COUNTY WASTEWATER AUTHORITY Orange County, California (SOCWA) AND TERMINATING ALISO WATER MANAGEMENT AGENCY, SOUTH EAST REGIONAL RECLAMATION AUTHORITY, SOUTH ORANGE COUNTY RECLAMATION AUTHORITY .,# . 0 , a • , L l TABLE OF CONTENTS Page RECITALS...............................................................2 AGREEMENT............................................................7 I. DEFINITIONS..........................................................7 1.1 Definitions.......................................................7 II TERMINATION OF THE JPAs........................................... 10 2.1 Recission.......................................................10 III. PURPOSE AND POWERS OF CONSOLIDATED JPA ........................ 11 3.1 Agency Created..................................................11 3.2 Purpose of the Agreement; Common Powers to be Exercised .............. 11 3.3 Specific Powers .................................................. 12 3.4 Restrictions on Exercise of Powers ................................... 14 3.5 Authority as Successor to JPAs...................................... 14 3.6 Adoption of Rules, Regulations, Policies .............................. 15 3.7 Personnel.......................................................15 3.8 Project Committees; Agreements .................................... 16 IV. ORGANIZATION......................................................16 4.1 Membership.....................................................16 4.2 Names.........................................................17 4.3 Designation of Directors ........................................... 17 4.4 Principal Office .................................................. 17 4.5 Meetings........................................................17 4.6 Quorum........................................................18 4.7 Voting Powers and Limitations Thereon ............................... 18 4.8 Minutes........................................................18 4.9 Rules..........................................................18 4.10 Vote or Assent of Members ......................................... 18 4.11 Officers........................................................19 V. PLANNING...........................................................20 5.1 Planning Policy..................................................20 HAW&G/PG/kp/75093 i -i- VI. BUDGETS AND PAYMENTS ............................................ 21 6.1 General Budget..................................................21 6.2 Project Budgets..................................................21 6.3 Operation and Maintenance Budgets .................................. 22 6.3.1 0 & M Costs/Capital Components ............................. 23 6.4 Effect of Failure of Approval of Budget ............................... 23 6.5 Expenditures Under Approved Budgets ............................... 24 6.6 Payment of Amounts Due..........................................24 6.7 Reimbursement of Funds ........................................... 24 VII. BOND FINANCING......................................:.............25 7.1 Financing Method................................................25 VIII. PROJECT CONSTRUCTION ............................................. 25 8.1 Project Members ................................................. 25 8.1.1 Project Committee of One Member ............................. 25 8.2 Acquisition and Construction of Projects .............................. 26 IX. MAINTENANCE AND OPERATION OF FACILITIES ........................ 26 9.1 Maintenance and Operation of Facilities ............................... 26 X. ACCOUNTING AND AUDITS ........................................... 27 10.1 Accounting Procedures............................................27 10.2 Audit..........................................................27 XI. PROPERTY RIGHTS ................................................... 27 11.1 Project Facilities..................................................27 11.2 Distribution of Assets and Termination of Authority ..................... 28 11.3 Liabilities.......................................................29 XII. FORMATION, TERM, TERMINATION, WITHDRAWAL ..................... 29 12.1 Term...........................................................29 12.2 Rescission or Termination .......................................... 29 12.3 Withdrawal......................................................29 XIII. GENERAL............................................................30 13.1 Admission of New Member Agencies ................................. 30 13.2 Insurance.......................................................30 BAW&G/PG/kP/75093 13.3 Amendments....................................................31 13.4 Notice..........................................................31 13.5 Arbitration......................................................31 13.6 Severance.......................................................33 13.7 Counterparts.....................................................33 Exhibit A Map of SOCWA Jurisdiction ................................. Exhibit B List of Member Agencies .................................... BAW&G/PG/kp/75093 JOINT EXERCISE OF POWERS AGREEMENT CREATING SOUTH ORANGE COUNTY WASTEWATER AUTHORITY Orange County, California (SOCWA) AND TERMINATING ALISO WATER MANAGEMENT AGENCY, SOUTH EAST REGIONAL RECLAMATION AUTHORITY, SOUTH ORANGE COUNTY RECLAMATION AUTHORITY THIS AGREEMENT is made and entered into as of the I" day of July, 2001, to be effective on the Effective Date (as hereinafter defined) by and between CITY OF LAGUNA BEACH (CLB), CITY OF SAN CLEMENTE (CSC), CITY OF SAN JUAN CAPISTRANO / CAPISTRANO VALLEY WATER DISTRICT (SJC/CVWD), EL TORO WATER DISTRICT (ETWD), EMERALD BAY SERVICES DISTRICT (EBSD), IRVINE RANCH WATER DISTRICT (IRWD), MOULTON NIGUEL WATER DISTRICT (MNWD), SANTA MARGARITA WATER DISTRICT (SMWD), SOUTH COAST WATER DISTRICT (SCWD), and TRABUCO CANYON WATER DISTRICT (TCWD), which are water purveyors and/or wastewater service providers within the San Juan Creek and/or Aliso Creek watersheds and other watershed areas within the jurisdiction of the California Regional Water Quality Control Board, San Diego Region ("Region 9") and (in some cases) Santa Ana Region ("Region 8"). The public entities listed above may be referred to in this Agreement collectively or in combination(s) as "parties" or "Members Agencies" or individually as "parry" or a "Member Agency". Capitalized terms not otherwise defined shall have the definitions set forth in Section I. BAW &G/PBG/ke/70093.5 17005 M 6 1004 M 6 -Clean 05/0 1/0 1 RECITALS A. CSC, MNWD, SCWD, SJC/CVWD and SMWD are Member Agencies of South East Regional Reclamation Authority (SERRA) formed under and pursuant to Government Code Section 6500 et seq. and that certain joint powers agreement dated March 9, 1970, entitled "Joint Exercise of Powers Agreement Creating South East Regional Reclamation Authority, Orange County, California (SERRA)" as thereafter amended from time -to -time ("SERRA Joint Powers Agreement'). B. CLB, EBSD, ETWD, IRWD (as the consolidated successor to Los Alisos Water District), MNWD and SCWD are members of Aliso Water Management Agency (AWMA) formed under and pursuant to Government Code Section 6500 et seq. and that certain joint powers agreement dated March 1, 1972, entitled "Joint Exercise of Powers Agreement Creating Aliso Water Management Agency, Orange County, California (AWMA)," as thereafter amended from time -to -time ("AWMA Joint Powers Agreement'). C. ETWD, IRWD (as the consolidated successor to IRWD and Los Alisos Water District), MNWD, SJC/CVWD, SCWD, SMWD and TCWD are members of South Orange County Reclamation Authority (SOCRA) formed under and pursuant to Government Code Section 6500 et seq. and that certain joint powers agreement dated November 29, 1994, entitled "Amended and Restated Joint Exercise of Powers Agreement Creating South Orange County Reclamation Authority," as thereafter amended from time -to -time ("SOCRA Joint Powers Agreement'). D. CVWD is currently a subsidiary district of SJC, with the SJC City Council as its legislative body. Pursuant to Orange County Local Agency Formation Commission (LAFCO) BAW &G/PBG/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -2- Reorganization R096-15, SJC will formally merge with CVWD upon the completion of certain terms and conditions under LAFCO Resolution No. R096-15. This Agreement provides for the membership of SJC/CVWD in Authority as a single Member Agency and recognizes SJC as the successor SOCRA member to CVWD and to all of CVWD's rights, obligations, agreements, liabilities, and all other duties previously held by CVWD in its capacity as a member of SOCRA. SJC hereby assumes all of CVWD's rights, obligations, agreements, liabilities and all other duties previously held by CVWD in its capacity as a member of SOCRA. E. Effective December 31, 2000, IRWD is the successor -in -interest to Los Alisos Water District (LAWD), a former member of AWMA, and to IRWD and LAWD, former members of SOCRA, pursuant to both Orange County Local Agency Formation Commission Resolution DC 00-05 adopted on September 13, 2000, which approved the consolidation of LAWD and IRWD, and Orange County Board of Supervisors Resolution 00-399 adopted on October 24, 2000, which ordered the consolidation of LAWD with IRWD, leaving IRWD as the consolidated successor district. The boards of directors of AWMA and SOCRA have adopted, respectively, AWMA Resolution No, 2001- 01 and SOCRA Resolution No. 2001-01 formally recognizing IRWD as the successor AWMA member to LAWD and as the successor SOCRA member to LAWD and IRWD, and to all of the rights, obligations, agreements, liabilities and all other duties previously held by LAWD in its capacity as a member of AWMA and by LAWD and IRWD in their capacities as members of SOCRA. F. AWMA, SERRA and SOCRA (collectively the "JPAs") currently share in the administrative support costs necessary to administer the JPAs, including the services of the General Manager of the JPAs and the administrative support staff, as well as the joint use of administrative building facilities for the operation of the JPAs, pursuant to that certain agreement BA W & G/PB G/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -3- •A ., 0 R , • entitled "Agreement Among the South East Regional Reclamation Authority, Aliso Water Management Agency and South Orange County Reclamation Authority Establishing Procedures for Shared Staff Resources", recently amended on November 2, 2000, to provide for the consolidation of administrative facilities operations at the SERRA treatment plant in the near future. G. In accordance with extensive reviews and reports initiated by the JPAs over the past five years, including a 1996 administrative and management review study by Griffith & Associates, and the 1999 report entitled "Evaluation of the Future Policy Direction for the AWMA/SERRA Organization" prepared by the JPAs' General Manager in accordance with board direction, the boards of directors of the JPAs desire at this time to formally consolidate the JPAs into one joint powers authority in the interests of furthering a regional approach to wastewater treatment and reclamation, and additional operational and administrative efficiencies, subject to the unanimous approval by the respective Member Agencies of the termination of AWMA, SERRA and SOCRA concurrently with the formation of a consolidated joint powers agency by execution of this Agreement. H. Each of the parties hereto has territory within or related to the San Juan Creek and/or Aliso Creels watershed areas or other watershed areas within the Orange County portion of Region 9 and/or Region 8 as set forth and depicted on Exhibit A to this Agreement including the designation thereon of the existing boundaries of the parties. There is a continued need for efficiencies in the coordinated regional planning of wastewater disposal, reclamation and total water management, as well as of production, transmission, storage and distribution of Nondomestic Water and a coordinated effort to facilitate and expedite new and increased use of Nondomestic Water, within the area set forth in Exhibit A. Additionally, the continued BAW&G/PBG/kenoo93.5 17005 M 6 1004 M 6 - Clean 05/01/01 -4- implementation of a primary user permit for use of Recycled Water and to process associated modifications to water quality objectives and beneficial use designations for groundwaters and surface waters, as necessary, for implementation of reclamation plans within certain of the area designated in Exhibit A and also within Region 9 can most efficiently be achieved through the continued cooperative action of the parties operating through a consolidated joint exercise of powers agency in lieu of all three JPAs. The parties have and possess one or more of the following powers: (1) the power and authorization to acquire and construct facilities for the collection, transmission, treatment and disposal of sewage and other waste products, including the reclamation of wastewater for the benefit of the lands and inhabitants within their respective boundaries; (2) the power and authorization to acquire and construct facilities for the production, treatment, transmission, storage and distribution of Nondomestic Water for the benefit of the lands and inhabitants within their respective boundaries; and (3) the power and authorization to acquire and construct facilities to supply the inhabitants and lands within their respective boundaries with potable and recycled water for irrigation, domestic and municipal purposes, inclusive of providing for the development and conservation of water supplies. J. The parties own and operate or have capacity rights in wastewater treatment and/or reclamation plants under the jurisdiction of Region 9, and/or utilize groundwaters or surface waters in accordance with basin plans approved by Region 9. Additionally, ETWD and IRWD each include within their respective boundaries watershed areas within the jurisdiction of Region 8. The parties previously undertook regional wastewater disposal and reclamation BAW &G/PBGIke(70093.5 17005 M 6 1004 M 6 - Clcan 05/01/01 -5- programs, as well as total water management plans within the areas designated in Exhibit A through cooperative action by operating through the JPAs. The groundwaters and surface waters are used in accordance with certain water quality objectives and beneficial use designations set forth in basin plans approved by Region 9 or Region 8. K. The parties previously constructed, with the assistance of federal and State Clean Water Act grant funding, and now operate and maintain certain wastewater treatment and reclamation plants through the AWMA/SERRA organization. In addition to ongoing capital improvements for such plants and other AWMA/SERRA facilities, the parties are undertaking the planning and construction of facilities for the production and utilization of Nondomestic Water from the wastewater treatment and reclamation plants and/or through other means with available groundwaters and/or surface waters, which include additional treatment, production, transmission, storage, pumping and distribution facilities. The governing body of Region 9 previously supported and encouraged the establishment of SOCRA for the purposes of holding a single primary producer/user permit for the San Juan Creels and Aliso Creek watersheds, and other watershed areas within the Orange County portion of Region 9, amending the associated basin plans in conjunction with implementation of recycled water plans for those areas and coordinating and regulating the use of Nondomestic Water within such areas. SOCRA administered compliance with all regulations, orders and permits issued from time to time relative to Recycled Water previously performed by Region 9, and implemented amendments to basin plans under the jurisdiction of Region 9 in order to provide for uniform water quality objectives and Nondomestic Water use requirements. L. Each of the parties is authorized to contract with each other for the joint exercise of any common power under the Act. The parties desire to form a single joint powers authority B A W &G/PB G/ke/70093.5 17005 M 6 1004 M 6 -Clean 05101101 -6- 1 r • • t 1 as a successor -in -interest to AWMA, SERRA and SOCRA for all purposes by execution of this Agreement, subject to the terms and conditions set forth in this Agreement. Generally, the terms and conditions include the continuation of all existing AWMA, SERRA and SOCRA project committees, and corresponding project agreements, including but not limited to the rights, duties and liabilities of the respective Member Agencies under all such project committees and agreements. Additionally, plans, benefits, permits, contracts, policies and all other rights and legal obligations of the JPAs will be assumed by the successor joint powers authority in the manner provided in this Agreement as a means to effecting the consolidation without adverse impacts to the continuous facilities operations of the JPAs. In consideration of the mutual promises and covenants herein contained, the parties hereto agree as follows: I. AGREEMENT 1.1 Definitions. For the purpose of this Agreement, the following words shall have the following meanings: (a) "Act' means Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the California Government Code, as now or hereinafter amended. (b) "Agreement' means this joint exercise of powers agreement. (c) "Authority" means the SOUTH ORANGE COUNTY WASTEWATER AUTHORITY formed pursuant to this Agreement. BA W&G/PBG/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -7- a (d) `Board" or `Board of Directors" means the governing body of the Authority. (e) "Bond Law" means Article 2 of the Act (commencing with Section 6540 of the California Government Code), the Marks -Roos Local Bond Pooling Act of 1985, being Article 4 of the Act (commencing with Section 6584 of the California Government Code), the Mello -Roos Community Facilities Act of 1982 (commencing with Section 53311 of the California Government Code), as any of the aforementioned statutes are now or hereafter amended, or any other law presently or hereafter legally available for use by the Authority in the authorization and issuance of Bonds to finance or refinance the acquisition, construction, renovation, leasing, subleasing, maintenance or operation of Projects authorized hereunder. (f) "Bonds" means bonds, notes or other obligations of the Authority issued pursuant to the Bond Law or pursuant to any other provision of law which may be used by the Authority for the authorization and issuance of bonds, notes or other obligations. (g) "Effective Date" means July 1, 2001; provided, the Effective Date with respect to the termination of AWMA, SERRA and SOCRA as provided for in Section II may be a later date for certain limited purposes as may be required. (h) "Fiscal Year" means July 1 st to and including the following June 30', BAW&GfPSG/ken0093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -8- r (i) "General Budget' means the approved budget applicable to the expenses of administration of the Authority. (j) "Member Agency" or "Member" means each of the parties which become a signatory to this Agreement, accepting the rights and obligations of the Authority hereunder, including any public entity executing an addendum to this Agreement as a Member Agency as hereinafter provided. (k) "Nondomestic Water" means Recycled Water (as defined below), groundwater, surface water and any other nonpotable water produced and or utilized by the parties. (1) "Participating Director" means the director representing a Participating Member Agency. (m) "Participating Member Agency or Agencies" means a Member Agency(ies) that has or will acquire rights and assume obligations in connection with a particular Project. (n) "Project' means the facilities owned, constructed or operated and maintained by the Authority pursuant to the project budget procedure. (o) "Recycled Water" means secondary or higher treated effluent reclaimed under and pursuant to Title 22 requirements of the California Code of Regulations (or successor provisions) and used for irrigation and other purposes in the Aliso Creek, San Juan Creek watersheds or other watershed areas. As used in this Agreement, words of the masculine gender shall be deemed and construed to include correlative words of the feminine and neuter genders. Unless the context otherwise BA W &G/PBG/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -9- i 0 indicates, words importing the singular shall include the plural and vice versa, and words importing persons shall include corporations and associations, including public bodies, as well as natural persons. II TERMINATION OF THE JPAs 2.1 Recission . Except as may be necessary to wind up the affairs of AWMA, SERRA and SOCRA in order to arrange for the orderly transition to the Authority of the JPAs' rights, duties and liabilities as more specifically detailed in this Agreement, or to otherwise accomplish the implementation of current employee plans or benefits, or other programs, (a) pursuant to Sections 33 and 34 of the AWMA Joint Powers Agreement, CLB, ETWD, EBSD, IRWD, MNWD and SCWD individually and collectively rescind the AWMA Joint Powers Agreement and thereby terminate AWMA, such recission and termination to be effective on the Effective Date, subject to the above -referenced proviso as to winding up AWMA affairs and subject to all other terms and conditions set forth in this Agreement and provided further, that the project committee agreements of AWMA shall not be terminated and shall be transferred automatically to the Authority on the Effective Date; (b) pursuant to Sections 33 and 34 of the SERRA Joint Powers Agreement, CSC, SJC/CVWD, MNWD, SMWD and SCWD individually and collectively rescind the SERRA Joint Powers Agreement and thereby terminate SERRA, such recission and termination to be effective on the Effective Date, subject to the above -referenced proviso as to winding up SERRA affairs and subject to all other terms and conditions set forth in this Agreement and provided further, that the project committee agreements of SERRA shall not be terminated and shall be transferred automatically to the Authority on the Effective Date; and -10- HAW&GlPBGIM70093.5 17005 M 6 1004 M 6- Clean 05/01/01 (c) pursuant to Sections 33 and 34 of the SOCRA Joint Powers Agreement, CVWD/SJC, ETWD, IRWD, MNWD, SMWD, SCWD and TCWD individually and collectively rescind the SOCRA Joint Powers Agreement and thereby terminate SOCRA, such recission and termination to be effective on the Effective Date, subject to the above -referenced proviso as to winding up SOCRA affairs and subject to all other terms and conditions set forth in this Agreement and provided further, that the project committee agreements of SOCRA shall not be terminated and shall be transferred automatically to the Authority on the Effective Date. III. PURPOSE AND POWERS OF CONSOLIDATED JPA 3.1 Agency Created. A public entity to be known as the "SOUTH ORANGE COUNTY WASTEWATER AUTHORITY" (the "Authority") is hereby formed by the parties, such formation to be effective the Effective Date, and deemed to occur simultaneously with the termination of AWMA, SERRA and SOCRA. The Authority is formed by this Agreement pursuant to the provisions of the Act and the Bond Law. The Authority shall be a public entity separate from the parties. 3.2 Purpose of the Agreement: Common Powers to be Exercised. Each party to the Agreement has the common power to do the following: (a) Plan for, acquire, construct, maintain, repair, manage, operate and control facilities for the collection, transmission, treatment and disposal of wastewater, the reclamation and use of wastewater for any beneficial purposes, and the production, transmission, storage and distribution of Nondomestic Water. (b) Plan for, acquire, construct, maintain, repair, manage and operate and control facilities to supply the inhabitants and lands within their respective BA W & G/PB G/ke/70093.5 17005 M 6 1004 M 6 -Clean 05/01/01 _11- boundaries with water for irrigation, domestic and municipal purposes, and in carrying out such purposes to provide for the development and conservation of water supplies. (c) Develop planning objectives and facilities as necessary to recharge groundwaters and utilize live -stream discharge opportunities. (d) Implement waste discharge requirements and basin plan amendments, acquire National Pollutant Discharge Elimination System ("NPDES") permits and primary producer/user permits for Recycled Water and provide for the development and conservation of potable water relating thereto. (e) Establish a Nondomestic Water management program for the area within Authority and a mechanism to interface with Region 9 and Region 8. The purpose of this Agreement is to jointly exercise the foregoing common powers in the manner set forth in this Agreement. 3.3 Specific Powers. The Authority shall have the power in its own name to do any of the following, subject to the limitations otherwise herein set forth: (a) To exercise jointly the common powers of the Members Agencies in studying and planning ways and means to provide a reasonable program for wastewater disposal and reclamation, as well as a water management program for the Aliso Creek and San Juan Creek watersheds and related areas; HAW &G/PBG/ke/70093.5 17005 M 6 1004 M 6 -Clean 05/01/01 -12- (b) To exercise jointly the common powers of the Member Agencies in planning and implementing a reasonable program for management and use of Nondomestic Water, as practicable; (c) To make and enter into contracts, including contracts for the construction of public works, in the same manner as a California water district, Section 34000 et seq, of the California Water Code; (d) To contract for the services of engineers, attorneys, planners, financial consultants, and separate and apart therefrom to employ such other persons, as it deems necessary; (e) To acquire, construct, manage, maintain and operate any buildings, facilities, works, or improvements; (f) To acquire, hold and dispose of real and other property; (g) To issue Bonds and otherwise to incur debts, liabilities or obligations, subject to applicable limitations; (h) To sue and be sued in its own name; (i) To apply for and hold permits, including NPDES permits and primary producer and/or user permit or other similar permit for production or use of Recycled Water and to provide for the implementation and enforcement of permit conditions; 0) To facilitate or undertake work designed to result in basin plan amendments in conjunction with formulating a regional reclamation plan and the use of Nondomestic Water; BA W &G/PBG/ke/70093.5 17005M6 1004M6 -Clean 05/01/01 -13- (k) To apply for appropriate grants or loans or other available financing programs under any federal, state or local programs for assistance in developing or accomplishing any of the programs or purposes specified in this Agreement; and (1) To exercise any and all other powers as may be provided in the Act or in the Bond Law. 3.4 Restrictions on Exercise of Powers. The powers of the Authority shall be exercised in the manner provided in the Act and in the Bond Law, and, except for those powers set forth in the Bond Law, shall be subject (in accordance with Section 6509 of the Act) to the restrictions upon the manner of exercising such powers that are imposed upon a California water district (see, Section 34000 et seq. of the California Water Code) in the exercise of similar powers and to any restrictions set forth elsewhere in this Agreement. 3.5 Authority as Successor to JPAs. Except as more specifically set forth herein as to certain rights and obligations, as of the Effective Date Authority shall be deemed the successor - in -interest to AWMA, SERRA and SOCRA for all purposes, and shall assume all assets, obligations, agreements and liabilities of the JPAs, including but not limited to: (a) project committees and project committee agreements; contracts; NPDES permits and Recycled Water primary user permits; interagency agreements with the Member Agencies as well as other public entities; operating and encroachment permits; licenses and leases; federal and/or state grant contracts or loans; policies, resolutions, rules and regulations, ordinances; and joint powers memberships/joint powers agreements, except for the joint powers agreements expressly terminated in Section II hereof, BAW &G/PBG/ke/70093.5 17005 M 6 1004 M 6 -Clem 05/01/01 -14- • 1 A (b) the 1978 and 1979 AWMA Lease Revenue Bonds, and the 1998 AWMA Refunding Lease Revenue Bonds; (c) the AWMA and SERRA administrative, wastewater treatment and disposal, potable water, Recycled Water, Nondomestic Water and sewer facilities and capacities (as applicable) and associated lands and rights-of- way; (d) personal property, including vehicles, office furniture equipment and documents; and (e) capital, operating, reserve, investment, and all other funds and cash balances. 3.6 Adoption of Rules, Regulations, Policies. Except as otherwise specified in this Agreement, all the AWMA, SERRA and SOCRA resolutions, policies, ordinances and rules and regulations shall be deemed adopted by Authority and the Board of Directors as of the Effective Date; provided, where there is conflict or inconsistency between such documents necessitating a resolution between inconsistent or conflicting terms, the parties shall take appropriate action so as to retain as nearly as practicable the substance of the policies, rules, etc., effecting each JPA prior to the Effective Date, unless otherwise agreed by the parties. 3.7 Personnel. All employees of AWMA and SERRA shall become employees of Authority as of the Effective Date. The AWMA/SERRA/SOCRA General Manager shall be the General Manager of Authority upon the Effective Date. The current Memorandum of Understanding effective through June 30, 2001, by and between AWMA/SERRA and the AWMA/SERRA Employees Association, as well as the B A W &G/PB G/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -15- 0 . . ! AWMA/SERRA Personnel Policy, shall each be deemed assumed and adopted, respectively, by Authority as of the Effective Date. The foregoing terms are set forth to effectuate the orderly succession of Authority to the JPAs and are not for the benefit of, nor shall such terms be enforceable by, any third party not a party to this Agreement. 3.8 Project Committees: Agreements. Notwithstanding the foregoing succession -in - interest by Authority to the JPAs, and except as may be agreed upon by the parties after the Effective Date, the rights, duties, obligations and liabilities of the parties (including any acknowledged successors to such parties) under and pursuant to the JPAs' project committees and project agreements, and any other agreements and budgetary procedures arising out of or in connection with the project committee structure or the JPAs generally (except the joint powers agreements terminated under Section II hereof), including but not limited to capacity rights and liabilities, shall remain intact and unchanged by the consolidation of the JPAs, the formation of Authority and its' assumption of the aforesaid obligations, agreements, liabilities and assets, or the execution of this Agreement. IV. ORGANIZATION 4.1 Membership. The Members of the Authority shall be each public entity which has executed or hereafter executes this Agreement, or any addendum, amendment or supplement thereto, and which has not, pursuant to the provisions hereof, withdrawn therefrom. 4.2 Names. The names and addresses of the Member Agencies at any time shall be shown on Exhibit B, attached hereto, as amended or supplemented from time to time. 4.3 Designation of Directors. Within thirty (30) days after the execution of this Agreement, each Member Agency shall designate and appoint, by resolution of its governing BA W & G/PB G/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01101 -16- body, one person to act as its director on the Board. Each Member Agency shall also appoint one alternate director and may appoint a second alternate director, whose name(s) shall be on file with the Authority and who may assume all rights and duties of the absent director representing the appointing Member Agency. Each director and alternate(s) shall hold office from the fust meeting of the Board after his appointment by the governing body which he represents until his successor is selected. Directors and alternates shall serve at the pleasure of the governing board of the appointing Member Agency and may be removed at any time, with or without cause, in the sole discretion of said Member Agency's governing board. A director or alternate may be (but is not required to be) a member of the governing board of the appointing Members. A director may receive such compensation from the Authority for his services as may from time to time be established by the Board, or, in the alternative at the election of any individual Member Agency, a director may be compensated directly by such Member Agency. A director may be reimbursed by the Authority for expenses incurred by such director in the conduct of the business of the Authority. 4.4 Principal Office. The principal office of the Authority shall be established by the Board. The Board is hereby granted full power and authority to change said principal office from one location to another in the County of Orange. Any change shall be noted by the Secretary of the Authority in appropriate documents of the Authority but shall not be considered an amendment to this Agreement. 4.5 Meetings. The Board shall meet at the principal office of the Authority or at such other place as may be designated by the Board. The time and place of regular meetings of the Board shall be determined by resolution adopted by the Board, and a copy of such resolution shall be furnished to each party hereto. Any meeting of a project committee shall be deemed to BAW &GIPBG/ken0093.5 17005 M 6 1004 M 6 . Clean 05/01/01 -17- be a meeting of the Authority and all such meetings of the Authority shall be open to all directors. Regular, adjourned and special meetings of the Authority, including project committee meetings, shall be called and held in the manner as provided in Chapter 9, Division 2, Title 5 of the Government Code of the State of California (commencing at Section 54950). 4.6 Quorum. Two-thirds (2/3) of the Board of Directors shall constitute a quorum for the purposes of the transaction of business relating to the Authority. A majority of the Participating Directors acting on behalf of a project committee, but not less than two (2) (subject to Section 8. 1.1 hereof), shall constitute a quorum for the purposes of the transaction of business of the Authority on matters relating to each Project in which not all of the Member Agencies are participating. 4.7 Voting Powers and Limitations Thereon. All of the powers and authority of the Authority shall be exercised by the Board, subject, however, to the reserved right of the Member Agencies as herein set forth. Unless otherwise provided herein, each director or Participating Director shall be entitled to one vote, and a vote of the majority of the Board qualified to vote may adopt any motion, resolution, or order and take any other action which they deem appropriate to carry forward the objectives of the Authority or of a project committee. 4.8 Minutes. The Secretary of the Authority shall cause to be kept minutes of regular, adjourned regular and special meetings of the Board and project committees, and shall cause a copy of the minutes to be forwarded to each director and to each of the Member Agencies. 4.9 Rules. The Board may adopt, from time to time, such rules and regulations for the conduct of its affairs as may be required. 4.10 Vote or Assent of Members. The vote, assent, or approval of Member Agencies in any matter requiring such vote, assent, or approval hereunder shall be evidenced by a certified BA W &G/PBG/ke/70093.5 17005M6 1004M6 -Clow) 05/01/01 -18- copy of the resolution of the governing board of such Member filed with the Authority, or a certified copy of minutes evidencing such vote, assent or approval. 4.11 Officers. There shall be selected from the membership of the Board a Chairman and a Vice -Chairman. The Board shall appoint a Secretary, who may be a Director. The Chairman, Vice -Chairman and Secretary shall hold office for a period of one year commencing July 1st of each Fiscal Year or until their respective successors are duly qualified; provided, however, the first Chairman, Vice -Chairman and Secretary appointed shall hold office from the date of appointment to June 30' of the ensuing Fiscal Year. The General Manager of the Authority shall serve as the Treasurer of the Authority, and shall direct the deposit and custody of all money of the Authority from whatever source in accordance with applicable policies approved by the Board. The General Manager of the Authority shall also be the Auditor of the Authority and shall draw all warrants and pay demands against the Authority approved by the Board. The Treasurer/Auditor hereby designated may be changed by the consent of a majority of the directors. As provided in Section 6505.6 of the Act, the Treasurer/ Auditor shall make arrangements with a certified public accountant or firm of certified public accountants for the annual audit of accounts and records of the Authority. The Board shall have the power to appoint such additional officers as it deems necessary. Any officer, employee or agent of the Board may also be an officer, employee or agent of any of the Member Agencies. The appointment by the Board of such a person shall be evidence that the two positions are compatible. The public officer or officers or persons who have charge of, handle, or have any access to any property of the Authority shall be bonded and the amount of their bond shall be designated and fixed in the applicable budget. BAW&G/PBG/ken0093.5 17005 M 6 1004 M 6 - Clew 05/01/01 -19- All of the privileges and immunities from liability, exemption from laws, ordinances and rules, all pension, relief, disability, worker's compensation and other benefits which apply to the activity of officers, agents, or employees of any of the Member Agencies when performing their respective functions shall apply to them to the same degree and extent while engaged in the performance of any of the functions and other duties under this Agreement. None of the officers, agents, or employees appointed by the Board shall be deemed, by reason of their employment by the Board, to be employed by any of the Member Agencies or, by reason of their employment by the Board, to be subject to any of the requirements of such Member Agencies. V. PLANNING 5.1 Planning Policv. In keeping with the purpose of this Agreement, the Member Agencies hereby authorize and direct the Board and Authority to undertake, from time -to -time, studies and planning relative to the Aliso Creels and San Juan Creels watersheds and related areas as may be necessary to provide for the collection, treatment, reclamation and total disposal of sewage of each of the Member Agencies, as well as for integrated water management plans for the areas within such watersheds and related areas. The specific objectives of the studies shall be to obtain and implement regional solutions to wastewater disposal and reclamation problems. To achieve this objective, the studies may include proposals for the construction of trunk and interceptor sewers, treatment plants, and outfalls for final disposal, as well as facilities for reclamation and water management within the watershed areas. Any such studies shall consider all phases of the maintenance and operation of regional facilities and the allocation to the benefitted Member Agencies of any maintenance and operating costs. In addition, the study may include the reclamation of sewage for any and all uses including, but not limited to, water for domestic, agricultural and recreational uses. The study or studies shall also concentrate on the BA W &G/PBG/ke/70093.5 17005 M 6 1004 M 6 • Clem 05/01/01 -20- • 1 • methods of financing any construction proposed and the allocation of construction costs among the benefitted members. The Member Agencies hereby authorize and direct the Board and the Authority to undertake, from time -to -time, studies and planning relative to the watersheds and related areas, as may be necessary, to provide for the production, transmission, storage and distribution of Nondomestic Water by Authority as well as an integrated plan for use of Nondomestic Water by Authority, including any necessary amendments to basin plans of Region 9 and Region 9. VI. BUDGETS AND PAYMENTS 6.1 General Budget. Within sixty (60) days after the first meeting of the Board, a "General Budget" shall be adopted for the balance of the Fiscal Year and the ensuing Fiscal Year. The initial General Budget and each succeeding General Budget shall include the following: (a) the general administrative expenses of the Agency to be incurred during the period covered by the General Budget; and (b) the allocation among the Member Agencies of the amounts necessary to cover the General Budget expenditures. If the General Budget provides an allocation to the Member Agencies on some basis other than equal amounts, the General Budget must be approved by the unanimous consent of all of the Member Agencies. After the first full Fiscal Year, at or prior to each June meeting of the Board, a General Budget shall be adopted for the ensuing Fiscal Year. 6.2 Proiect Budgets. In addition to the General Budget, the Board may budget at any time for the study, implementation or construction of any specific Project proposed to be constructed by the Authority ("Project Budget'). Each Project Budget shall include at a minimum the following: BA W &G/PB G/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -21- (a) the administrative expenses allocated to the project during planning and construction; (b) the cost of studies and planning for the Project; (c) the cost of the engineering and construction of the Project; (d) the allocation among the Participating Member Agencies of the total Project costs; (e) an estimate of annual maintenance and operating expenses; and (f) a formula for allocating annual maintenance and operating expenses. After the Board approves a Project Budget, it shall be submitted to each Member Agency which has expressed a desire to participate and is to be obligated for the payment of any amount thereunder. The Authority shall not incur any expense for the Project until the Project Budget has been approved by the governing body of each of the proposed Participating Member Agencies. In the event a Project Budget is not approved, the cost of preparing the budget shall be divided among the proposed Participating Member Agencies in accordance with the proposed allocation of the total Project costs. 6.3 Operation and Maintenance Budgets. For each Project operated and maintained by the Authority, a operations and maintenance budget ("O & M Budget") shall be prepared and approved at or prior to each June meeting of the Board for the ensuing Fiscal Year. Said budget shall include the following: (a) the estimated expenses of operating the Project; (b) the estimated expenses of maintaining the Project; (c) an estimate of income from operations, if any; and BA W &GlPBG/ke/70093,5 17005 M 6 1004 M 6 - Clem 05/01/01 -22- (d) the allocation of operation and maintenance expenses among the Participating Member Agencies in accordance with the formula set forth in the approved Project Budget. An O & M Budget must be approved by two-thirds (2/3) of the directors or by two-thirds (2/3) of the Participating Directors if the budget affects less than the entire membership. Copies of each O & M Budget shall be mailed to each Participating Member Agency within thirty (30) days of its adoption. 6.3.1 O & M Costs/Capital Components. It is agreed as follows: (a) all operations and maintenance costs directly related to the use of the Project facilities, including necessary improvements, repairs, adjustments, replacements and incidental accounting and administrative costs in connection therewith, shall be paid by each Member Agency using the Project facilities in proportion to its use; and (b) the maintenance costs not directly related to use of the Project facilities, including necessary capital improvements, repairs, adjustments, replacements and extraordinary or standby maintenance, and incidental accounting and administrative costs in connection therewith, shall be paid by the Participating Member Agencies in proportion to their respective percentage share of the ownership of capacity in said Project facilities. Any change of the foregoing may be made by the unanimous consent of all of the Participating Member Agencies. 6.4 Effect of Failure of Approval of Budget. If, after one hundred twenty (120) days from the first submission of a General Budget or Project Budget, the budget fails to attain the required vote, the consenting Directors, in the case of the General Budget, or the Participating Directors, in the case of a Project Budget, may treat the refusal of the representative director to approve the respective budget as a request for a withdrawal from the Authority, in the case of BAW &G/PBG/ke/70093.5 17005 M 6 1004 M 6 • Clean 05/01/01 -23- 0 0 failure to approve a General Budget; or as a request from withdrawal from the Project, but not from the Authority, in the case of failure to approve a Project Budget, by such Participating Director; the remaining Member Agencies may thereafter, upon giving the non -consenting Member Agency thirty (30) days prior written notice, proceed with the adoption of a revised General or Project Budget, and the non -consenting member shall not be obligated for future debts of the Authority or of the Project, as the case may be, nor shall it receive any benefits therefrom. The foregoing is subject to the provisions of Section 12.3 of this Agreement. 6.5 Expenditures Under Approved Budgets. All expenditures within the designations and limitations of an approved General, Project or O & M Budget shall be made on the authorization of a majority of the directors for General Budget expenditures, or of a majority of the directors of the Participating Member Agencies for Project Budget or O & M Budget expenditures. No expenditures in excess of those budgeted in the General Budget or in a Project Budget shall be made without the unanimous consent and approval of the directors representing the Member Agencies affected by the budget wider consideration. No expenditures in excess of those budgeted in an O & M Budget shall be made without the consent and approval of two- thirds (2/3) of the directors representing the Member Agencies affected by the O & M Budget under consideration. 6.6 Payment of Amounts Due. Amounts required to be paid by any Member Agency or Participating Member Agency, shall be due and payable forty-five (45) days after receipt of billing therefor from the Authority. 6.7 Reimbursement of Funds. Grant funds or loan proceeds or other funding assistance received by the Authority from any federal, state, or local agency to pay for budgeted expenditures for which the Authority has received all or a portion of said funds from the Member B A W &G/PB G/ke/70093.5 17005 M 6 1004 M 6 - Clean 05101101 -24- 0 0 Agencies shall be proportionally paid to the respective Member Agencies to reimburse the members for the funds advanced to the Authority for the construction of the Project facilities for which such funding has been received. VII. BOND FINANCING 7.1 Financing Method. The Board shall have the power and authority to issue Bonds on behalf of the Authority pursuant to the Act or the Bond Law, for the purposes now or hereinafter provided for in this Agreement and as specifically set forth in Section III. Any election or referendum provided for in the Act or Bond Law shall be held in the jurisdictional area(s) of the Member Agency(ies) on whose behalf a financing is undertaken by Authority, unless otherwise provided by the Act or Bond Law. The voters voting on the Bonds shall be the resident registered voters as defined by the California Elections Code, or as otherwise provided by the Act or Bond Law. VIII. 8.1 Project Members. If it is determined that a proposed Project includes participation by less than all of the Member Agencies, the Participating Directors for each project shall constitute a subcommittee of the Board referred to as the " Project Committee". All actions by a project committee shall be deemed actions of the Authority and shall be taken in the name of the Authority, provided, only the Participating Member Agencies shall have rights and obligations in said Project as herein provided. The project committees of AWMA, SERRA and SOCRA shall retain their existing designations, or may be re -numbered, but shall in any case be deemed to be the project committees of the Authority automatically upon the Effective Date. 8. 1.1 Project Committee of One Member. In the event that only one Participating Member Agency desires to take action in the name of the Authority and fund and BA W &G/PB G/ke/70093.5 11005 M 6 1004 M 6 - Clem 05/01/01 -25- I • • operate a Project, a project committee may be formed consisting of only one Member Agency; provided, however, that all other Member Agencies shall have a right to participate in any project, and further provided that in the event a project committee is formed consisting of only one Member Agency, the Board of Directors may, by majority vote of the directors, impose conditions upon the manner of taking action of such a project committee. 8.2 Acquisition and Construction of Projects. No project shall be acquired or constructed by the Authority without the unanimous consent of every Member Agency or, if it is a project of less than all of the Member Agencies, unanimous consent of all of the Participating Member Agencies. Approval of a project budget by all of the Participating Member Agencies shall constitute consent for the acquisition and construction of the Project. In the event any individual Participating Member Agency or combination of such agencies desire to modify, rehabilitate or otherwise improve the Project, and those Participating Member Agencies agree to pay all costs associated with the modifications, rehabilitations or other improvements, including but not limited to the costs of all necessary permits and regulatory approvals, as well as engineering and construction costs, such agency or agencies may proceed with the modifications or other improvements upon approval of a simple majority vote of all Participating Member Agencies. No Participating Member Agency shall unreasonably withhold or condition its approval of a Project modification, rehabilitation or improvement which is proposed to be wholly funded by other Participating Member Agencies. IX. MAINTENANCE AND OPERATION OF FACILITIES 9.1 Maintenance and Operation of Facilities. The Board, or the project committee, as the case may be, shall determine whether or not the Authority shall maintain and/or operate Project facilities. If the Authority is to maintain and/or operate Project facilities, it shall do so in BA W &G/PBG/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -26- an efficient and economical manner, and in a manner not detrimental to the Participating Member Agencies. It is the intent of the parties that any Project may be maintained and operated in the name of the Authority although, as herein provided, a majority of the Participating Directors shall make all determinations of the Authority in connection therewith. If it is determined by the Participating Member Agencies that one or more of the Member Agencies shall maintain and/or operate Project facilities, the Participating Member Agencies shall, by written agreement, consent unanimously thereto. X. ACCOUNTING AND AUDITS 10.1 Accounting Procedures. Full books and accounts shall be maintained for the Authority in accordance with practices established by, or consistent with those utilized by, the Controller of the State of California for special districts, or for. other public entities as specified by the Act. The Authority's Auditor and Treasurer shall comply strictly with requirements of the Act governing joint powers agencies relative to such matters. 10.2 Audit. In accordance with Section 6505 of the Act, the records and accounts of the Authority shall be audited annually by an independent certified public accountant and copies of such other reports shall be filed with the State Controller, Orange County Auditor and each Member Agency within six (6) months of the end of the Fiscal Year under examination. Copies shall also be provided to persons or entities so requesting as required by the Act. lP" 11.1 Project Facilities, All Project facilities constructed or acquired by the Authority shall be held in the name of the Authority for the benefit of the membership of the Authority in accordance with the terms of this Agreement. The cost and depreciation of all Project facilities so constructed or acquired shall be charged or accrue to the Participating Member Agencies in BAW&G/PBG/ken0093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -27- proportion to each Member's agreed percentage of capacity rights in such Project facility and shall not be charged or accrue to the account of the Authority unless agreed to in writing by all Participating Member Agencies; provided, however, that depreciation of all facilities acquired or constructed pursuant to funds obtained through the State or federal government through the Clean Water Grant Program or through other State or federal financing programs shall be charged or accrued to the account of the Authority if required by such programs. Capacity rights in Project facilities shall be held for the benefit of the Participating Member Agencies in proportion to each such member's agreed percentage of capacity rights in such Project facility unless otherwise agreed to in writing by said Participating Member Agencies. It is the intent of the foregoing provision that the Authority shall not acquire any unallocated capacity rights in any Project facility for disposal or use, except for the benefit of the Participating Member Agencies in proportion to their original percentage of capacity rights in said facility. Capacity rights may not be sold, leased or assigned to parties or entities other than Member Agencies, or between and among Member Agencies without the written consent of all Participating Member Agencies in a Proj ect. 11.2 Distribution of Assets and Termination of Authority. To the extent that any funds (or property in lieu of funds) received from any Participating Member Agency are used for the acquisition or construction of Project facilities, the same shall be allocated annually on the books of the Authority to the credit of said contributing member. Upon termination or dissolution of the Authority herein created, the Project facilities and any funds in possession of the Authority at such time shall be distributed in kind or sold, and the proceeds thereof distributed to the Participating Member Agencies at the time of termination as their interests appear on the books of the Authority. BA W &G/PBG/ke/70093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -28- • 11.3 Liabilities. The parties to this Agreement do not intend hereby to be obligated either jointly or severally for the debts, liabilities or obligations of the Authority, except as may be specifically provided for in California Government Code Section 895.2 , as amended or supplemented. The parties further agree as follows: (i) pursuant to California Government Code Section 895.4, in the event the parties, under applicable law, are held liable for the acts or omissions of the Authority caused by a negligent or wrongful act or omission occurring in the performance of this Agreement; or (ii) in the case of any other liability incurred by the Authority during the course of its existence; then, with respect to (i) and (ii) the parties shall discharge any such liability from payments to be made to the Authority by each of the parties in proportion to each parties' contribution or approved participation in Project facilities of the Authority to which the liability is attributable, unless otherwise agreed; provided, the foregoing contribution from the Member Agencies shall be required only to the extent the Authority does not have insurance coverage for such liability. Each Member Agency shall indemnify, defend and hold harmless the other Member Agencies from any such liability in excess of its proportionate share. Except as provided herein, the debts, liabilities, and obligations of the Authority shall be the debts, liabilities or obligations of the Authority alone and not of the Member Agencies. XII. FORMATION. TERM, TERMINATION, WITHDRAWAL 12.1 Term. The Authority shall continue until this Agreement is rescinded or terminated as herein provided. 12.2 Rescission or Termination. This Agreement may be rescinded and the Authority terminated by written consent of all Member Agencies. 12.3 Withdrawal. Any Member Agency may withdraw from the Authority effective on the last day of a specified Fiscal Year by giving each of the Member Agencies written notice one BA W &G/PBG/ke/70093.5 17005 M 6 1004 M 6 • Clem 05/01/01 -29- 0 hundred and twenty (120) days prior to the end of a Fiscal Year which Fiscal Year shall be specified in said notice; provided, however, in the event the withdrawing Member Agency has any rights in any Project facility, or obligations to the Authority, said Member cannot sell, lease or transfer said rights or be relieved of its obligations, except its obligation to pay its share of operation and maintenance costs directly related to the use of the Project facilities, without the execution of a written agreement executed by it and all Member Agencies affected by such withdrawal. The Authority may not sell, lease, transfer or use any rights of a Member who has withdrawn without first obtaining the written consent of the withdrawn Member. Upon termination, a withdrawn member will be treated like all other Members in regard to the provisions of Section 11.2 hereof. XIII. GENERAL 13.1 Admission of New Member Agencies. It is recognized that public entities, other than the signatories to this Agreement, may wish to participate in the Authority. Additional public entities may become Member Agencies of the Authority upon such terms and conditions as provided by the Board and the unanimous consent of each existing Member Agency of the Authority, evidenced by the execution of a written addendum to this Agreement, signed by all of the Member Agencies, including the additional Member Agency. 13.2 Insurance. The Member Agencies agree that the Authority shall obtain policies of general liability, workers' compensation and property insurance (as applicable) which shall remain in effect at all times the Authority remains inexistence or is otherwise winding up its affairs pursuant to any termination thereof. The Authority shall name each of the Member Agencies and their officers, directors, employees and consultants as additional insureds under all such policies, including all excess policies. BAW&G/PBG&e/70093.5 17005 M 6 1004 M 6 - Clem 05/01/01 -30- 0 , , 13.3 Amendments. This Agreement may be amended only by the unanimous vote of all Member Agencies. 13.4 Notice. Any notice or instrument required to be given or delivered shall be validly given and made by depositing the same in any United States Post office, first class postage prepaid, addressed to the addresses of the Member Agencies as shown on Exhibit B, and shall be deemed to have been received by the parry to whom the same is addressed at the expiration of seventy-two (72) hours after deposit of the same in the United States Post Office for transmission. 13.5 Arbitration. Any controversy or claim between any two or more parties to this Agreement, or between any such party or parties and the Authority, in respect to the Authority operations, or to any claims, disputes, demands, differences, controversies, or misunderstandings arising under, out of, or in relation to or in connection with this Agreement, or any breach thereof, shall be submitted to and determined by arbitration. To the extent not inconsistent herewith, the rules of the American Arbitration Association shall apply. The party desiring to initiate arbitration shall give notice of its intention to arbitrate to every other party to this Agreement and the Authority. Such notice shall designate as "respondents" such other parties as the initiating party intends to have bound by and any award made therein. Any party not so designated but which desires to join in the arbitration may, within fifteen (15) days of service upon it of such notice, file a response indicating its intention to join in and to be bound by the results of the arbitration, and further designating any other parties it wishes to name as a respondent. Within twenty (20) days of the service of the initial demand for arbitration, the American Arbitration Association, hereinafter referred to as "AAA" shall submit simultaneously to the initiating party and to all parties named as respondents or filing a response therein, an B A W &GlPB Glke(70093.5 17005 M 6 1004 M 6 • Clean 05/01/01 -31- identical list of names of persons chosen from the AAA National Panel of Arbitrators which persons shall be, to the extent possible, persons first in the field of wastewater disposal and reclamation as well as public law. Each party to the dispute shall have fifteen (15) days from the mailing date in which to cross off any names to which it objects, number the remaining names indicating the order of its preference, and return the list to the AAA. If a party does not return the list within the time specified, all persons named therein shall be deemed acceptable. From among the persons who have been approved on both lists, in accordance with the designated order of mutual preference, the AAA shall invite the acceptance of an arbitrator to serve. If the parties fail to agree upon one of the persons named, or if an acceptable arbitrator is unable to act, or if for any other reason the appointment cannot be made from the submitted list, the AAA shall have the power to make the appointment of the arbitrator from other members of the panel without the submission of any additional list. The arbitrator shall determine the rights of the parties in accordance with the law, and the award shall be subject to review as to the arbitrator's application of the law by any court having jurisdiction thereof, whether or not any mistake of law shall appear upon the face of the award. As to all questions of facts, however, the determination of the arbitrator shall be binding upon all parties and shall be final. Any party shall be entitled to written findings of fact and conclusions of law as to all issues determined by the award. Subject to the above limitations, the award shall be binding upon all parties to the arbitration and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The arbitrator may, in his discretion, as part of the arbitration award impose upon any one parry or allocate among two or more of the parties, the liability for the arbitration fees and expenses. Such allocable fees may include the initial administration fees, fees for second and BAW&G1PBG/ken0093.5 17005 M 6 1004 M 6 - Clean 05/01/01 -32- M ' / 0 subsequent hearings, postponement fees, and overtime fees. Allocable expenses may include the expenses of producing witnesses, the cost of stenographic records, the cost of any transcripts, travel expenses of the arbitrator and tribunal administrator, the expenses of any witnesses, the costs of any proofs produced at the direct request of the arbitrator, and any other expenses relating directly to the arbitration. In the event of the failure of the arbitrator to provide for the allocation of such fees and expense, the arbitration fees shall be divided equally between the parties and the expenses shall be borne by the party incurring them. 13.6 Severance. If any section, subsection, sentence, or clause or phrase of this Agreement, or the application thereof, to any of the Member Agencies or any other person or circumstances is for any reason held invalid, the validity of the remainder of the Agreement, or the application of such provision to the other Member Agencies, or to any other persons or circumstances, shall not be affected thereby. Each of the Member Agencies hereby declares that it would have entered into this Agreement, and each section, subsection, sentence, clause or phrase thereto, irrespective of the fact that one or more sections, subsections, sentences, clauses or phrases, or the application thereof, to any Member Agency or any other person or circumstance be held invalid. 13.7 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. BA W &G/PB G/ke/70093.5 17005 M 6 1004 M 6 -Clan 05/01/01 -33- • ` i 0 IN WITNESS WHEREOF, the parties hereto have set their hands and seals by their respective officers thereunto duly authorized the day and year first herein above written. CITY OF LAGUNA BEACH By:I~J��i Mayor City Clerk [Additional Signatures Next Page] BA W &G/PBG/ke/70093.5 17005 M 6 1004 M 6- Clean 05/0 1/0 1 -34-A CITY OF SAN CLEMENTE By: ,zo!—t- s W-V%4Af' Mayor By: eir2GL /� City Clerk CITY OF SAN JUAN CAPISTRANO/ CAPISTRANO VALLEY WATER DISTRICT By: Mayor By: City Clerk EL TORO WATER DISTRICT By: President By: Secretary EMERALD BAY SERVICES DISTRICT By: President By: Secretary B A W &G/PBG/ke/70093.3 17005 M 6 1004 M 6 - Clean 02/05/01 -34- CITY OF SAN CLEMENTE By: Mayor By: City Clerk CITY OF SAN JUAN CAPISTRANO/ CAPISTRANO VALLEY WATER DISTRICT By: &&--7vjaz Ma(� r By: `Y City Clerk EL TORO WATER DISTRICT By:.. President By: Secretary EMERALD BAY SERVICES DISTRICT Bv: President By: Secretary BAW &G/PBG/ke/70093.3 17005 M 6 1.004 M 6 - Clean 02/05/01 -34- CITY OF SAN CLEMENTE By: Mayor By: City Clerk CITY OF SAN JUAN CAPISTRANO/ CAPISTRANO VALLEY WATER DISTRICT By: Mayor By: City Clerk EL TORO WATER DISTRICT By: Secretary EMERALD BAY Bv: President By: Secretary DISTRICT BA W &G/PBG/ke/70093.3 17005 M 6 1004 M 6 - Clean 02/05/01 -34- 6 t CITY OF SAN CLEMENTE By: Mayor By: City Clerk CITY OF SAN JUAN CAPISTRANO/ CAPISTRANO VALLEY WATER DISTRICT By: Mayor By: City Clerk EL TORO WATER DISTRICT Bv: President By: Secretary EMERALD BAY SERVICES DISTRICTT� Vice President By: Secretary 711�� BA W &G/PBG/ke/70093.3 17005 M 6 1.004 M 6 - Clean 02105101 -34- a t BA W &G/PBG/ke/70093.3 17005 M 6 1004 M 6 - Clean 02/05/01 IRVINE RANCH WATER DISTRICT=S�I B�� Preside By: 1� Secre MOULTON NIGUEL WATER DISTRICT By: President By: Secretary SANTA MARGARITA WATER DISTRICT By: President By: Secretary SOUTH COAST WATER DISTRICT By: President By: Secretary -35- e IRVINE RANCH WATER DISTRICT By: President By: Secretary MOULTON NIGUEL WATER DISTRICT By resident A MARGARITA WATER DISTRICT By: President By: Secretary SOUTH COAST WATER DISTRICT By: President By: Secretary BAW&G/P86/1,00093.3 17005 M 6 1004 M 6 - Clean 02/05/01 -35- 11 1 IRVINE RANCH WATER DISTRICT By: President By: Secretary MOULTON NIGUEL WATER DISTRICT By: President By: Secretary SANTA MARGARITA WATER DISTRICT By: &Zvw resident// By: Y�iu-Av S etary SOUTH COAST WATER DISTRICT By: President By: Secretary BAW&G/PBG/ke/700933 17005 M 6 1004 M 6 - Clean 02/05/01 -35- t e r IRVINE RANCH WATER DISTRICT By: President By: Secretary MOULTON NIGUEL WATER DISTRICT By: President By: Secretary SANTA MARGARITA WATER DISTRICT By: President By: Secretary SOUTH COA T WATER DISTRICT By: —sYf President By: Secretary BA W &G/PBG/ke/70093.3 17005 M 6 1004 M 6 - Clean 02/05/01 -35- i TRABUCO CANYON WATER DISTRICT 0 By:�r— ecretary BA W &G/PBG/ke/70093.3 17005 M 6 1004 M 6 - Clean 02/05/01 -36- EXHIBIT A South Ore County WeistewatEPAuthority Jurisdictional Boundary EXHIBIT B MEMBER AGENCIES City of Laguna Beach 505 Forest Avenue Laguna Beach, CA 92651 Phone: 949-497-0704 Fax: 949-497-0791 City of San Clemente 910 Calle Negocio San Clemente, CA 92672 Phone: 949-498-2533 Ext.#120 City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Phone: 949-493-1171 El Toro Water District P.O. Box 4000 Laguna Hills, CA 92653 Phone: 949-837-7050 Fax: 949-837-7092 Emerald Bay Service District 600 Emerald Bay Laguna Beach, CA 92651 Phone: 949-494-8571 Fax: 949-497-0982 Irvine Ranch Water District P.O. Box 57000 Irvine, CA 92619-7000 Phone: 949-453-5300 Fax: 949-453-1228 Moulton Niguel Water District 27500 La Paz Road Laguna Niguel, CA 92656 Phone: 949-643-2006 Fax: 949-831-5651 Santa Margarita Water District 26111 Antonio Parkway Rancho Santa Margarita, CA 92688 Phone: 949-459-6400 Fax: 949-459-6463 South Coast Water District P.O. Box 30205 Laguna Niguel, Ca 92607-0205 Phone: 949-499-4555 Fax: 949-499-4265 Trabuco Canyon Water District 32003 Dove Canyon Drive, 92679 P.O. Box 500 Trabuco Canyon, CA 92678 BAW&G/PG/kW75093 • AGENDA REPORT TO: Dave Adams, City Manager 00 - FROM: Cynthia Russell, Interim Public Works Director is 5/15/2007 SUBJECT: Consideration of Addendum 2 to Amendment No. 2 to Conduct a Pilot Project for the Recycled Water Advanced Wastewater Treatment Plant (South Orange County Wastewater Authority) (CIP Nos. 787 & 788) RECOMMENDATION: By motion, Approve an Addendum 2 to Amendment No. 2 with South Orange County Wastewater Authority to Conduct a Pilot Project for the Recycled Water Advanced Wastewater Treatment Plant; and, 2. Authorize a transfer of $225,000 from CIP No. 788 to CIP No. 787; and, 3. Authorize the deposit of $205,000 with the South Orange County Wastewater Authority for the work. SITUATION: On June 29, 2000, the City entered into Amendment No. 2 to the PC 2 agreement forming the PC2-AWT. The purpose of which is to design, construct, operate, and fund the J. B. Latham advanced water treatment plant (AWT) to produce recycled water. The South Orange County Wastewater Authority (SOCWA), the Moulton Niguel Water District (MNWD), the South Coast Water District (SCWD), and the City of San Juan Capistrano (the City) are the active partners in this project. Santa Margarita Water District is a member of the PC 2 but is not directly participating in this agreement. On September 5, 2006, the City entered into Addendum 1 to Amendment No. 2 to the PC 2 agreement (The Design Study Agreement) to perform a feasibility study and to conduct the CEQA process in order to maintain eligibility for the Proposition 50 grant in May 2007. At its January 17, 2007, meeting, the Department of Water Resources (DWR) Board awarded the City and its partners a grant of $5 million for the AWT; and, for the City only, an additional grant of $5 million for the distribution trunkline system. The DWR Board directed its staff to enter into a process formalizing the agreement and setting a time frame for achievements and cost reimbursements as part of the grant process. Agenda Report 4W 4W May 15, 2007 Pape 2 In January 2007, SOCWA's consultant CH2MHill completed its feasibility study, and presented its findings to the Water Advisory Commission at its meeting of March 27, 2007. A key finding is the need to perform a pilot test of available technology on the secondary treated effluent of the J. B. Latham plant during summer months when performance would be most critical. This point is important in that the quality of the water varies from summer to winter, and the objective is to choose the equipment that will work best in the summer months when demand for recycled water is highest. The pilot test will rent, install, operate, and evaluate two technology alternatives — cloth media filters vs. two competing pressurized membrane filters. The pilot test will also include structural evaluation of an abandoned wet well and a pump station contemplated for use in the final AWT. Attachment No. 1 describes the needed pilot project work in detail. The pilot project will resolve critical technology questions impacting the final design and costs of the AWT. Specifically the question of whether membrane filters of cloth media filters will be required. The use of cloth media filters could lower the cost of the AWT by 20%, or about $3 million. If the structural evaluation of the existing wet well and pump station determines these to be unusable, there could be an increase in the cost; however, the issue will be resolved early in the process. Staff recommends performance of the Pilot Project because it will allow the City to maintain eligibility for the Proposition 50 grant without the full commitment of spending on the AWT design after the DWR imposed begin date of May 2007. And, it will provide a refinement of the knowledge about the cost and operational characteristics of the planned AWT to allow for completion of the design build operate (DBO) Agreement with SOCWA, MNWD, and SCWD. Staff recommends entering into the Pilot Project Agreement (Attachment 2) as the most efficient means of conducting the work. SOCWA, MNWD, SCWD, and SMWD will take the Pilot Project Agreement to their Boards concurrently with the City's presentation to the Commission and the City Council. COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: The Water Advisory Commission recommended approval of this Agreement at its meeting on April 24, 2007. FINANCIAL CONSIDERATIONS: The Recycled Water Master Plan includes funding of $1,200,000 in CIP No. 787; which has been now included in FY 2007/08 budget for design and development work. To pay for this work at this time, staff proposes to transfer $225,000 from CIP No. 788, which has $400,000 budgeted for reservoir development work, and return the funds in FY 2007/08. Staff feels that the transfer will not interrupt progress on the planned reservoir development work with the remaining funds in CIP No. 788. The City's share of the 0 CH2MHILL January 31, 2007 Mr. Brian Peck, P.E. South Orange County Wastewater Authority (SOCWA) 34156 Del Obispo Street, Dana Point, CA 92629 0 CH2M HILL 3 Hutton Centre Drive Suite 200 Santa Ana, CA 92707 Tel 714.429.2000 Fax 714.429.2050 Subject: Proposal for J. B. Latham Treatment Plant Advanced Wastewater Treatment Facility Technology Pilot Testing and Structural Assessment of Abandoned Effluent Pump Station Dear Mr. Peck: Thank you for the opportunity to submit our proposed scope of work and fee estimate for the J. B. Latham Treatment Plant QBLTP) Advanced Wastewater Treatment (AWT) Facility technology pilot testing and structural assessment of abandoned effluent pump station. As was decided at the SOC WA Engineering Committee Meeting held on December 14, 2006, in order to reach a conclusive decision regarding the suitability of the cloth media filters and as the AWT technology, it is necessary to collect site specific operational data at JBLTP. This was decided to be accomplished through performance pilot testing that would simulate operational conditions AWT facility will encounter. It was also decided that it would be beneficial to pilot test the two technologies (cloth media filters and pressurized membrane filters) side by side to have the best information for moving forward with the AWT project. The preliminary design concepts developed for AWT include use of the abandoned effluent pump station and its wet well as the recycled water (RW) pump station. A review of the as - built drawings of JBLTP showed that the structures were built prior to 1974 and no drawings for the wet well currently exist. Therefore, to evaluate the structural stability of the wet well and the pump room, a series of structural review and field tests are needed. In the event that the structures are found to be unsuitable for use as the RW pump station, they need to be demolished and a new pump station will need to be constructed. This proposal was developed based on our understanding of the work summarized above and it contains the following sections: • Scope of Work • Schedule • Fee Proposal SCOISOr.WA ADDITIONAL WORK LFTTER_ZKE013107,DOC Copyright 2007 by CH2M HILL Inc. ATTACHMENT Mr. Brian Peck, PE Page 2 Tanuary 31, 2007 Scope of Work Task 1. Project Meetings and Management This task consists of developing the necessary work plans, monitoring the progress of the activities and holding progress calls/meetings. This task includes three review workshops with SOCWA to be held at JBLTP offices at Dana Point. Deliverables: Meeting agenda and meeting minutes for the workshops. Task 2. AWT Technology Pilot Testing This task covers the CH2M HILL effort before, during, and immediately after the completion of the pilot testing activities at JBLTP. Task 2.1. Test Planning Task 2.1.1. CH2M HILL will meet with SOCWA staff to establish the pilot test objectives and criteria that will be applicable to the test planning and test units operation at the start of the work (Workshop 1 included under Task 1). Information developed under the "J. B. Latham Treatment Plant Advanced Wastewater Treatment Facility Preliminary Design Project' will be used as needed. These will include the design and performance criteria for satisfactory AWT operation under the existing JBLTP operations. Pre -qualification packages will be requested from the equipment manufacturers, and one manufacturer for each technology will be qualified based on pre -qualification criteria that will be developed in cooperation with SOCWA staff. Task 2.1.2. A pilot unit procurement package will be developed for one cloth media filter test unit, and one pressurized membrane test unit. The package will define the criteria for successful operation of the units and other site specific factors that need to be considered during pilot unit operations. Task 2.1.3. A pilot unit drawing set will be developed based on the equipment specifications provided by each manufacturer of one cloth media filter test unit, and one pressurized membrane test unit. For each pilot system one P&ID drawing defining the feed piping and pumping arrangements, as well as the system waste return piping and on-line unit controls/ monitoring will be provided. A total of two days of engineering support during pilot unit construction will be provided by one CH2M HILL project team member. Task 2.1.4. A pilot test plan will be developed for one cloth media filter test unit, and one pressurized membrane test unit. The plan will define the system operations, alarm responses, maintenance activities, system monitoring (chemical usage, power usage, water quality sampling, and online data collection) and other field activities. Deliverables: Pilot Unit Procurement Package; Pilot Unit Drawing Set (11"x17" prints and PDF format); and Pilot Test Plan Task 2.2. Pilot Operations Monitoring For the purpose of this scope of work, it was assumed that SOCWA staff will take the lead in operating, monitoring, sampling, and maintaining the pilot units. CH2M HILL will SCOrDCWA ADDITIONAL WORK LETTER ZKE01310/ 000 COPYRIGHT 2007 BY CH2M HILL INC. 0 0 Mr. Brian Peck, PE Page 3 January 31, 2007 receive weekly monitoring data (analytical and online recorded) from SOCWA staff to review the operations and system performance. It was assumed that pilot testing will be up to 6 months plus time for planning, system installation, start-up, and monitoring as shown on our proposed schedule. Monthly progress calls were included for this task under Task 1. Interim monitoring reports (3 reports consisting of tabular and graphical review of the field data, with brief discussion of performance for the reporting period) will be prepared. At the completion of the test, the results will be reviewed with SOCWA staff and a pilot test report will be prepared. The report will summarize the test unit operation for the cloth media filter and the pressurized membrane. System performance, power and chemical consumption, scale up considerations and a recommendation will be included. The recommendation will be based on sizing criteria and economic considerations given the pilot test results. Deliverables: Pilot Test Report Task 3. Structural Assessment of the Abandoned Effluent Pump Station CH2M HILL will evaluate the abandoned effluent pump station wet well and the pump room for structural integrity, The purpose is to establish the structural integrity of these structures, any differential settling of the structures, and potential rehabilitation /stabilization methods. Task 3.1. Site Visit and initial Review One site visit by one structural and one mechanical engineer will be conducted for evaluation of the structures. Site visit notes and pictures will be compiled to be included in the final recommendations report. A field investigation plan will be developed to define the field activities and test/concrete sample locations. Deliverables: Site Visit Notes; and Field Investigation Plan Task 3.2. Field Investigation A field investigation of the structures will be conducted by a structural engineer according to the field investigation plan developed under Task 3.1. Core sampling of the concrete and other non-invasive methods of investigation will be used. The findings will be reviewed and compiled in a structural assessment report along with a recommendation as to whether the structures could be utilized as is. Rehabilitation methods will be identified as applicable. One meeting with SOCWA staff is included (Workshop 2). For the preparation of this letter fee estimate, 4 core -drills were included. The core samples will be also examined by a corrosion engineer. If the field assessment requirements are found to be significantly different from this estimate, CH2M HILL will request additional approval from SOCWA. Deliverables: Structural Assessment Report Task 4. Update of AWT PDR Amendment to PDR will be developed based on the outcome of Tasks 2 and 3 of this project. The amendment will be prepared as an addendum to the PDR and will include SCO/SOCWA ADDITIONAL WORK LErTERjKE013107 AOC COPYRIGHT 2007 BY CH2M HILL INC. 0 0 Mr. Brian Peck, PE Page 4 lanuary 31, 2007 revised design criteria table and up to three site layouts (11"x17" prints and PDF format). One meeting with SOCWA staff is also included (Workshop 3). Deliverables: PDR Addendum Schedule Proposed schedule of the activities defined under the scope of work is presented in Exhibit 1. It is anticipated that the Tasks 2 and 3 will proceed independently. Fee Proposal Our fee estimate for the project, broken down by the project tasks is presented in Exhibit 2. In the event that unaccounted circumstances arise in the field, CH. 2M HILL will not proceed without further SOCWA approval. The fee estimate shown includes labor and expenses for the CH2M HILL staff, but not the cost of equipment rental or other charges that will be associated with the pilot test, as requested and it covers all items described in the scope of work presented above. The CH2M HILL hourly charge rates for professionals and technicians for 2007 are presented in Exhibit 3. To facilitate your review, we are available at any time to meet with you or to respond in any manner to questions or requests for additional information that you may want. If you need further information on our scope of work and the fee estimate, please contact Zeynep Erdal at 714/435-6145 or me at 714/435-6166. Sincerely, CH2M HILL 0G ohn Caldwell Vice President SCOISOOWA ADDITIONAL. WORK LETTER ZKE07370T DOG COPYRIGHT 2007 BY CH2M HILL INC. 0 S IL z LL, LU .. .. .... ..... LLJ zm� ��Ra � W LE 12 E C) F w -E E s1 2 CL M w E y Ety E < -6 -6 z < L) t - 0 S 0 Mr, Brian Peck, PE Page 6 January 31, 2007 Exhibit 2 - Fee Estimate' 0 Meetings/Workshops and QA/QC activities are included in accordance with the Scope of Work. SCO/SOCWA ADDITIONAL WORK LETT ER_ZKE013107.DOC COPYRIGHT 2007 BY CH2M HILL INC. ,.as 1 Description Project Meetings and Management $28,300 2 AWT Technology Pilot Testing $65,500 3 Structural Assessment of the Abandoned Effluent Pump Station $34,000 4 AWT PDR Addendum Preparation $10,000 Total i_ $137,800 Meetings/Workshops and QA/QC activities are included in accordance with the Scope of Work. SCO/SOCWA ADDITIONAL WORK LETT ER_ZKE013107.DOC COPYRIGHT 2007 BY CH2M HILL INC. 0 Mr. Brian Peck, PE Page 7 Tanuary 31, 2007 0 Exhibit 3 - CH2M HILL 2007 Hourly Charge Rate for Professionals and Technicians' Classification Hourly Rate 1 Principal/Senior Consultant/Program Mgr. $221 Senior Project Manager $193 Project Manager/Senior Engineer/Scientist $175 Task Manager/Project Engineer/Assistant Prj. Mgr. $165 Associate Engineer/Scientist/Planner $140 Staff Engineer/Scientist/Planner $117 Senior Technician II $137 Senior Technician l $125 $107 Staff Technicianfrechnical Editor Junior Technician $84 Administration/Accounting $86 * dnj't o �'Y:�N kF �r' Vi !i d qp Ac �{��i±� r e+i +^tat e o } NIX s :i X p MI i3y,✓' x.`15'5 Expense Type Estimating Method Rate Health & Safety Assessment" Service Center $1.75 Auto Mileage Travel Current IRS Rate ($0.445/mile) Auto Rental Travel Actual Other Travel (FTR Guidelines) Travel _ Actual Equipment Rental Operating Expense Actual Postage/Freight Operating Expense Actual Reprographics Outside Service Actual Subcontractors Outside Service Actual Rates are effective through December 31, 2007, and subject to adjustment on Januaryl, 2008 " Assessment applies to all individuals trained in Health & Safety SCOISOCWA ADDITIONAL WORK LETTER 2KEDI3107.DOC COPYRIGHT 2007 BY CH2M HILL INC. 0 0 \§ ° ■ _ / k«0 ;k{` ■ ,� „ ) ik 3k U) . ........... . ........................... ) C k k, a� ■@:a $;!{`\ _ Ew �» §fca16 © / { ./o _ \ /\ »/ /� :.Wim.ƒ§ ... ............ w{ \\ \ � L (§e: )) )\\�BG7i� at (R)k)\{\ \\\ co (/fƒ/ƒƒfƒ; 0 0 0 ADDENDUM 2 (AWT PILOT PROJECT WORK) TO AMENDMENT NO. 2 to AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 2 ("PC 2 AGREEMENT') (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 2 to Amendment No. 2 ("AWT Amendment') to the PC 2 Agreement is made effective this 3rd day of May, 2007 ("Effective Date"), by and among South Orange County Wastewater Authority ("SOCWA") for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC); (b) South Coast Water District ("SCWD"); (c) Moulton Niguel Water District ("MNWD"); and (d) Santa Margarita Water District ("SMWD"). SOCWA, SJC, SCWD, MNWD and SMWD are sometimes collectively referred to as the "parties" in this Addendum 2. RECITALS A. The PC 2 Members entered into the AWT Amendment on June 29, 2000, to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities ("AWT Project') at the Jay B. Latham Plant site. The PC 2 Members who will fund and thereafter have capacity interests in the AWT Project are SJC, SCWD and MNWD ("PC 2/AWT Members") B. The PC 2 Members entered into Addendum 1 to the AWT Amendment on October 5, 2006, to revise the project phasing and projected capacities, to provide for the dedication of secondary treated effluent for use by SJC in accordance with the limitations set forth therein, and to authorize the preliminary design and environmental review of the AWT Project. The PC 2/AWT Members have completed the preliminary design and the environmental review for the AWT Project and the project has qualified for Proposition 50 grant funding in the approximate amount of $5,000,000. ATTACHMENT 0 0 C. The parties desire to execute this Addendum 2 for the following purposes: (1) to authorize pilot testing of equipment to determine the appropriate treatment process in connection with the final design of the AWT Project ("Pilot Testing"); and, (2) to authorize field investigation of the Jay B. Latham Plant structure to verify assumptions included in the completed Preliminary Design for the AWT Project ("Field Investigation"). The parties agree as follows: AGREEMENT 1. Testing Investigation Authorization. The PC 2/AWT Members agree SOCWA may proceed with the Pilot Testing and Field Investigation, anticipated at a cost of approximately $261,800, subject to such PC 2's approval of the contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Attachment 1 for such contract(s) and services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 2, within thirty (30) calendar days after the Effective Date above. The projected cost allocation set forth in Attachment 1 is based on the current anticipated capacity interests the PC 2/AWT Members will have in the AWT Project. 2. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 2. Attachment 1 is incorporated into this Addendum 2. 3. Effect of Addendum 2. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the AWT Amendment and Addendum 1 thereto, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No. 2, inclusive of Addendum 1, and this Addendum 2 , the terms of this Addendum 2 shall control. The terms "PC 2 Agreement," "AWT Amendment" and "Addendum 1," as used in such documents, shall include this Addendum 2. 4. Counterparts. This Addendum 2 may be executed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. Page -2- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 THIS ADDENDUM 2 is entered into by each of the parties as of the Effective Date set forth above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 0 irman By Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA Patricia B. Giannone PC2/AWT MEMBERS: CITY OF SAN JUAN CAPISTRANO Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT a President By Secretary Page -3- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 0 0 SOUTH COAST WATER DISTRICT By President/Vice-President Secretary/Assistant Secretary PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT m President/Vice-President Secretary/Assistant Secretary Page -4- BAW&G/PG/1: 118810 17108 N 2.22 4-10-07 Draft 2 0 0 ATTACHMENT PC 2/AWT Members Pilot Testing/Field Investigation Budget Allocations Page -5- BAW&G/PG/]: 118810 17108 N 2.22 4-10-07 Draft 2 Share of Legal Costs Total Costs C2/AWT Member I Capacity (mgd) Capacity Share Share of Pilot Testing Costs SCWD 0.5 5.56% $ 14,445.00 $111.00 $ 14,556.00 MNWD 1.5 16.67% $ 43,309.00 $333.00 $ 43,642.00 SJC 7.0 77.78% $202,072.00 $1,556.00 $203,628.00 Total 9.0 100.00% $259,800.00 $2,000.00 $261,800.00 Page -5- BAW&G/PG/]: 118810 17108 N 2.22 4-10-07 Draft 2 0 n U 32400 PASEO ADEI_ANTO :' MEMBERS OF THE CITY COUNCIL SAN JUAN CAPISTRANO, CA 92675 i r � � SAM ALLEVATO (949) 493-1171MARK L U IAt0AA0AA1fA THOMAS HRIBAR (949) 493-1053 FAX 1961 BiAA[ISXfp www sant nancapistrano, org 1 ]]6 NIEL SEN JOE SOTO DR. LONDRES USO NOTIFICATION OF MEETING OF POTENTIAL INTEREST OF THE SAN JUAN CAPISTRANO CITY COUNCIL The City Council of San Juan Capistrano will meet at 7:00 p.m. on May 15, 2007 in the City Council Chamber in City Hall, to consider: "Consideration of Addendum 2 to Amendment No. 2 to Conduct a Pilot Project for the Recycled Water Advanced Wastewater Treatment Plant (South Orange County Wastewater Authority)(CIP No. 787 & 788)" — Item No. D8. If you have specific thoughts or concerns regarding this item, you are encouraged to participate in this decision making process. You can communicate with the City Council through correspondence addressed to the Council and/or by attending the meeting and speaking to the Council during the public meeting. Correspondence related to this item must be received at the City Clerk's office by 5:00 p.m. on Monday, May 14, 2007 to allow time for the Council to consider its content. If you would like to speak at the meeting, please complete a yellow "Request to Speak" form found inside the entrance to the Council Chamber. This form is turned in at the staff table, just in front of the Council dais. You will be called to speak by the Mayor when the item is considered. You have received this notice at the request of the City staff member Eric P. Bauman, Water Engineering Manager. You may contact that staff member at (949) 487-4312 with any questions. The agenda, including agenda reports, is available to you on our web site: www.sanivancapistrano.org. If you would like to subscribe to receive a notice when agendas are posted to the web site, please make that request by sending an e-mail to: citvclerkasanivancapistrano.org. Meg Monahan, MMC City Clerk cc: South Orange County Wastewater Authority; Moulton Niguel Water District; South Coast Water District; Santa Margarita Water District; Cindy Russell, Interim Director of Public Works; Eric P. Bauman, Water Engineering Manager * Received staff report San Juan Capistrano: Preserving the Past to Enhance the Future "Printed on recycled paper 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493-1053 FAX wwwsantuancapt.strano. org May 16, 2007 9 Jlwlw, � J/�,,�' IAfAR1AAR1ln • fslanoSHE R 1961 1776 NOTIFICATION OF ACTION BY THE CITY COUNCIL OF SAN JUAN CAPISTRANO MEMBERS OF THE CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONDRES USO On May 15, 2007, the City Council of San Juan Capistrano met regarding: "Consideration of Addendum 2 to Amendment No. 2 to Conduct a Pilot Project for the Recycled Water Advanced Wastewater Treatment Plant (South Orange County Wastewater Authority)(CIP No. 787 & 788)" Item No. D8. The following action was taken at the meeting: Addendum 2 to Amendment No. 2 with South Orange County Wastewater Authority to conduct a Pilot Project for the Recycled Water Advanced Wastewater Treatment Plant approved; transfer of $225,000 from CIP No. 788 to CIP No. 787 authorized; and deposit of $205,000 with the South Orange County Wastewater Authority, for the work, authorized If you have any questions regarding this action, please contact Eric P. Bauman, Water Engineering Manager at (949) 487-4312 for more detailed information. Thank you, Meg M a n, MMC City erk Sit Cc: mouth Orange County Wastewater Authority; Moulton Niguel Water District; South Coast Water District; Santa Margarita Water District; Cindy Russell, Interim Director of Public Works; Eric P. Bauman, Water Engineering Manager San Juan Capistrano: Preserving the Past to Enhance the Future 0 Printed on 100% recycled paper 1CWA County Wastewater Authority 2001 JUL 31 P 3- I 1 + Letter of Transmi�jp[I YCLERTRAN0 DATE: July 20, 2007 TO: Eric Bauman, Water Engineering Manager ATTENTI Maria Morris, Deputy Ci Cler RE: Project Committee No. 2 Addendum 2 (AWT Pilot Project Work Amendment No. 2 We are ® enclosing ❑ returning under separate cover: Sent for your Status Please Note ❑ Review/Use ❑ Preliminary ❑ Revisions ❑ Approval ❑ Revised ❑ Additions ❑ Signature ❑ Approved ❑ Omissions ® File ❑ Released ❑ Corrections REMARKS: Enclosed is a fully executed original of the above stated Addendum/Amendment for your records. Please let me know if you have any questions or if I can be of further assistance. Thanks. Sincerely, Teri Noson, Executive Assistant SOCWA COPIES TO: file JUL 2 4 2007 34156 Del Obispo Street • Dana Point, CA 92629 • Phone: (949) 234-5400 • Fax: (949) 489-0130 • Website: www.socwa.com A public agency created by: CITY OF LAGUNA BEACH • CITY OF SAN CLEMENTE • CITY OF SAN JUAN CAPISTRANO • EL TORO WATER DISTRICT • EMERALD BAY SERVICE DISTRICT IRVINE RANCH WATER DISTRICT • MOULTON NIGUEL WATER DISTRICT • SANTA MARGARITA WATER DISTRICT • SOUTH COAST WATER DISTRICT • TRABUCO CANYON WATER DISTRICT 0 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 4931171 (949) 4931053 FAX www. sanjuancapistrano. org TRANSMITTAL TO: Teri Noson SOCWA 34156 Del Obispo St. Dana Point, CA 92629 DATE: June 12, 2007 FROM: Maria Morris, Deputy City Clerk (949) 443-6309 RE: Addendum 2 to Amendment No. 2 — AWT Pilot Project Work MEMBERS OF THE CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONORES USO Enclosed are six (6) original signature pages. Please forward an original Addendum 2 when executed. If you have questions concerning the agreement, please contact Eric Bauman, Water Engineering Manager (949) 487-4312. Cc: Eric Bauman, Water Engineering Manager San Juan Capistrano: Preserving the Past to Enhance the Future 1011, Printed on 100% recycled paper • AGENDA REPORT TO: Dave Adams, City Manager � FROM: Cindy Russell, Interim Public Works Director • 5/15/2007 D7 SUBJECT: Consideration of the Conformed Addendum No. 1 to Amendment No. 2 of the Project Committee No. 2 Agreement (South Orange County Wastewater Authority) (CIP No. 787) By motion, approve the conformed version of Addendum No. 1 to Amendment No. 2 of the Project Committee No. 2 Agreement. SITUATION: At its meeting of September 5, 2006, the City Council: 1) Approved Addendum No. 1 to Amendment No. 2 of the Project Committee No. 2 Agreement (Attachment 1); 2) Authorized South Orange County Wastewater Authority to proceed with the Environmental Review and Complete the Preliminary Design Report; 3) Transfer $200,000 from CIP No. 788 (The Recycled Water Reservoirs) to CIP No. 787 (The Recycled Water Advanced Water Treatment Plant); and 4) Deposit $120,000 with SOCWA for the work. However, the version adopted by the five agencies involved was found to have several minor wording differences. A revised version with deleted and added text changes shown and highlighted in Attachment 2 displays those differences. The final revised version for signature is included as Attachment 3. Since the differences in the agreement will not affect the intent and function of the agreement, staff recommends that the City Council approve the Agreement. Agenda Report • • Paae 2 NOTIFICATION: South Orange County Wastewater Authority Moulton Niguel Water District South Coast Water District COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: May 15, 2007 The Water Advisory Commission recommended to approve the conformed version of Addendum No. 1 to Amendment No. 2 of the Project Committee No.2 Agreement at its Regular Meeting of December 19, 2006. RECOMMENDATION: By motion, approve the conformed version of Addendum No. 1 to Amendment No. 2 of the Project Committee No. 2 Agreement. Respectfully sub itte� Cindy uss I, Interim Public Works Director PSD Enc P. Bauman, Water Engineering Manager Attachments: 1. Originally authorized version of agreement 2. Agreement showing changes in text 3. Final Conformed Version Agreement C� ADDENDUM 1 TO AMENDMENT NO. 2 0 AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 2 (THE "PC 2 AGREEMENT") (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 1 to Amendment No. 2 to the PC 2 Agreement (hereinafter the "PC 2/AWT Agreement") is made effective this —day of August, 2006 (the "Effective Date"), by and among South Orange County Wastewater Authority ("SOCWA") (the successor in -interest to South East Regional Reclamation Authority (SERRA)), a joint power agency created by that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority, Orange County, California (SOCWA)" dated July 1, 2001 (the "Joint Powers Agreement"), and pursuant to Section 6500 and following of the Government Code of the State of California, for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC"), (b) South Coast Water District (°SCWD"); (c) Moulton Niguel Water District ("MNWD"); and (d) Santa Margarita Water District ("SMWD"). RECITALS A. The PC 2 members entered into the PC2/AWT Agreement to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities (the "AWT Project") at the Jay B. Latham Plant (formerly referred to as the "SERRA Plant", to be referred to as the "Plant" herein) site for the diversion of up to 11.0 mgd of secondary effluent produced at the Plant from discharge to the Pacific Ocean and treatment of such effluent for beneficial reuse as recycled water. The PC 2 Members who will fund, and thereafter have capacity interests in, the AWT Project are SJC, ATTACHMENT SCWD and MNWD (the "PC 2/AWT Members"). The PC 2/AWT Members desire to have SOCWA resume completion of the preliminary design and environmental review of the AWT Project, to be based upon the revised project phasing and participation as set forth in this Addendum 1. B. The AWT Project will be designed and constructed in one phase with a design capacity of 9.0 mgd, in lieu of the three phases and a design capacity of 11.0 mgd originally contemplated in the PC2/AWT Agreement. SCWD and MNWD plan to own and use less capacity in the AWT Project then originally set forth in the PC2/AWT Agreement, and SJC plans to own and use more capacity in the AWT Project then originally set forth in the PC 2/AWT Agreement. PC 2/AWT Member's currently contemplated capacities in the AWT Project are as follows: SCWD- 0.5 mgd, MNWD- 1.5 mgd; and, SJC- 7.0 mgd, for a total of 9.0 mgd in the AWT Project. C Based on the '[SERRA]Jay B. Latham Plant Wastewater Capacity Allocations' set forth in the PC 2 Agreement, SCWD and MNWD will have excess secondary treated effluent available even after their participation in the AWT Project at the revised AWT capacity interests set forth in this Addendum 1, which otherwise will be discharged to the Pacific Ocean. SMWD will not participate in the AWT Project and the secondary treated effluent related to SMWD's wastewater capacity allocation and wastewater flows actually sent to the Plant by SMWD are discharged to the Pacific Ocean. Pursuant to this Addendum 1, SJC desires to secure assurances from MNWD,SCWD and SMWD that SJC may use as long as it is available a quantity of secondary treated effluent generated at the Plant sufficient to support the projected recycled water production resulting from SJC's capacity interest(s) in the AWT Project, subject to the forty year term on such assurances provided for hereafter. D. The PC 2/AWT Members ( SJC, SCWD and MNWD) have reviewed alternative treatment processes for the AWT Project. In order to complete the Page -2- BA W,$<JPG kp/78800 I700S N 2 22- 6-11-06 Draft I 0 0 environmental review and the preliminary design for the AWT Project in a timely fashion so as to qualify for potential California State Proposition 50 grant funding in the magnitude of $5,000,000, the PC 2 Members desire to execute this Addendum 1 for the following purposes: (1) revise the project phasing and projected capacities of the PC 2/AWT Members previously set forth in PC 2/AWT Agreement; (2) provide for MNWD's ,and SCWD's consent to use of the available secondary treated effluent not otherwise needed by MNWD and SCWD to fully utilize their own respective capacities in the AWT Project, as well as SMWD's consent, to allow use of the available effluent by SJC in conjunction with its capacity in the AWT Project, and, (3) authorize the preliminary design and environmental review of the AWT Project in a timely manner so as to qualify for potential Proposition 50 grant funds, if and when such funds are available, and to otherwise authorize the funding of such design and environmental services. AGREEMENT The parties agree to revise the PC 2/AWT Agreement, including those certain sections of thereof as noted, as follows. 1. Revised Section 1 B "Project Phases". Section 1 B, Table 2, which sets forth the proposed capacities of each PC 2/AWT Member in the project facilities, is amended to be as follows: AWT PROJECT CAPACITIES (PROJECTED) 2. Environmental Review; Preliminary Design. The PC 2/AWT Members agree Page -3- It',U'&(, PG/kp/78800 1 -005 N ?.22- 6-11-06 Draft I Table 2 PC 2/AWT Member AWT Project Capacity m d Capacity Share SJC 7 77.78% MNWD 1.5 16.67% SCWD 0.5 5.56% Total 90 100.0% 2. Environmental Review; Preliminary Design. The PC 2/AWT Members agree Page -3- It',U'&(, PG/kp/78800 1 -005 N ?.22- 6-11-06 Draft I 0 0 SOCWA may proceed with the environmental review and the preliminary design of the AWT Project as revised by the terms of this Addendum 1, subject to the members' approval of the environmental services and design services contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Exhibit D (which Exhibit D will supercede the costs previously allocated to the members for preliminary design in Exhibit C to the PC 2/AWT Agreement) for the preliminary design and environmental review services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 1, within sixty (60) calendar days after the Effective Date of this Addendum 1. 3 Revised Section 2B. Section 2B, "Funding Opportunities Withdrawal", is amended as follows: "Section 213. Funding Opportunities Withdrawal. Upon request by any PC 2/AWT Member, and at any such member's individual expense, SOCWA will pursue funding opportunities from available state or federal sources/programs for the AWT Project at the earliest possible date. It is agreed by the parties to this Amendment No. 2 that, subsequent to the completion of the preliminary design and environmental review, but prior to the award of the final design contract for the AWT Project, any PC 2/AWT Member may withdraw from participation in the AWT Project. In the case of a withdrawal, all further obligations of the withdrawing member shall cease as of the date of such withdrawal, except obligations of that member for expenses already incurred pursuant to this Amendment No. 2. Subject to the further approvals by the PC 2/AWT Members prior to Final Design and construction, the AWT Project shall be constructed and thereafter owned, operated, and maintained by SOCWA, through, on behalf of, and for the use and benefit of, the remaining PC 2/AWT Members." Page -4- BAwsw PWkp 78800 17h0, N 2 ^-6-1 I-06 Urnfl I 0 0 5. Effluent Surplus. SMWD, MNWD and SCWD each agree that SJC may use effluent that is a byproduct of wastewater flows from, respectively, SMWD, MNWD and SCWD to the Plant, but, in the case of MNWD and SCWD, only to the extent that such effluent exceeds the levels required for, respectively, MNWD's and SCWD's AWT Project capacities (collectively hereinafter," Surplus Effluent"). SMWD, MNWD, SCWD each will allow the use of its Surplus Effluent (hereinafter the "SMWD Effluent", the "MNWD Surplus Effluent" and the "SCWD Surplus Effluent by SJC for such specific purpose, subject to the following conditions: (a) SJC's use of the Surplus Effluent will be deemed used on a proportionate basis as to the SMWD Surplus Effluent, the MNWD Surplus Effluent and the SCWD Surplus Effluent. Notwithstanding any other term set forth herein, SJC agrees that SMWD, MNWD and SCWD make no promises, assurances or guarantees that they will individually or collectively send sufficient wastewater flows to the Plant so that the Surplus Effluent will continue to be available, or available in any specific quantity, for SJC's use in connection with the AWT Project as provided in Amendment No. 2, as supplemented by this Addendum 1. (b) SJC's use of the Surplus Effluent is restricted for use by SJC in connection with SJC's 7.0 mgd capacity in the AWT Project, and for no other purpose unless otherwise agreed to in writing by SMWD,MNWD, SCWD and SJC, and approved by Project Committee No. 2, if required. (c) In recognition of SJC's necessity for the Surplus Effluent to fully utilize its AWT Project capacity and therefore benefit from investment in its recycled water program, SMWD, MNWD and SCWD each agree to enter into timely discussions with SJC on a means of avoiding any permanent reduction in the available Surplus Effluent should SMWD, MNWD or SCWD decide in the future to develop any facilities which will Page -5- 13 Uu,l (, 4'!i'Lp;'BNfro I' 1105 N 2 `2 1,.I1-04 D,atl I 0 0 reduce the amount of wastewater conveyed to the Plant and therefore impact the available Surplus Effluent necessary for SJC to utilize its capacity in the AWT Project. (d) Notwithstanding any other term set forth in this Addendum 1, the consent given by SMWD, SCWD and MNWD to SJC's use of the Surplus Effluent, including the requirement set forth in subsection (d) of this Section 5, will terminate on a date forty (40) years from the Effective Date, unless otherwise agreed to in writing by the parties hereto. Upon expiration of such consent, SJC shall be limited to the quantity of effluent generated at the Plant resulting from wastewater flows conveyed to the Plant by SJC, unless or until otherwise agreed by the parties. 6. Substitution of SOCWA. All references to "SERRA" set forth in the PC 2/AVVI- Agreement are deemed to be references to SOCWA, as SERRA's successor - in -interest. T Delete CGvL Report The parties agree that the CGvL Report will not be incorporated as Attachment 1 in the PC 2/AWT Agreement. 8. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 1. Exhibit D is attached and incorporated into this Addendum 1. 9. Effect of Addendum 1. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the PC 2/AWT Agreement, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No.2 , the terms of this Addendum 1 shall control. The terms "PC 2 Agreement" and "PC 2/AWT Agreement" as used in such documents shall include this Addendum 1. 10 Counterparts. This Addendum 1 may be executed in counterparts, each of Page -6- BAR KCd141/kp/78800 1700; N.'.22-6-11-05 Draft I 0 0 which shall constitute an original and which collectively shall constitute one instrument. THIS ADDENDUM 1 is entered into by each of the parties as of the Effective Date above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 By_ Chairman itz APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA By Patricia B Giannone Secretary Page -7- R � W&G/PG/kp/78800 1-005 N 2 22- 6 -II -06 Draft I Clerk JohrW. Shaw, City Attorney B A W&G/PG/kp/78800 1 %005 N 2.22- 6-I 1-06 Draft I PC2/AWT MEMBERS: CITY O AN JU N CAPIST ANO By: David M. Swerdlin, Mayor MOULTON NIGUEL WATER DISTRICT By President By Secretary SOUTH COAST WATER DISTRICT By President/Vice-President By Secretary/Assistant Secretary PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT By PresidentNice-President By Secretary/Assistant Secretary Page -8- 0 0 EXHIBIT D PC 2/AWT Members Environmental and Preliminary Design Services Budget Allocations PC2/AWT Member Capacity (mgd) Capacity Share Share of PDR Costs Share of CEQA Costs Total Costs SCWD 0.5 5.56% $4,722 $3,611 $8,333.00 MNWD 1.5 16.67% $14,167 $10,833 $25,000.00 SJC 7.0 77.78% $66,111 $50,556 $116,667.00 Total 9.0 100.00% $85,000 $65,000 $150,000.00 Page -9- BAW&.GTG/kp.!7NR00 17005 N 2.22- 6-1 1-06 Draft 1 0 0 ADDENDUM 1 TO AMENDMENT NO. 2 AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 2 (THE "PC 2 AGREEMENT') (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 1 to Amendment No. 2 to the PC 2 Agreement (hereinafter the "PC 2/AWT Agreement') is made effective this _ day of August, 2006 (the "Effective Date"), by and among South Orange County Wastewater Authority (" SOCWK) (the successor in -interest to South East Regional Reclamation Authority (SERRA)), a joint power agency created by that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority, Orange County, California (SOCWA)" dated July 1, 2001 (the "Joint Powers Agreement'), and pursuant to Section 6500 and following of the Government Code of the State of California, for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC"); (b) South Coast Water District ("SCWD"); (c) Moulton Niguel Water District ("MNWD"), and (d) Santa Margarita Water District ("SMWD"). RECITALS A. The PC 2 members entered into the PC2/AWT Agreement to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities (the "AWT Project") at the Jay B. Latham Plant (formerly referred to as the "SERRA Plant', to be referred to as the "Plant' herein) site for the diversion of up to 11.0 mgd of secondary effluent produced at the Plant from discharge to the Pacific Ocean and treatment of such effluent for beneficial reuse as recycled water. The PC 2 Members who will fund, and thereafter have capacity interests in, the AWT Project are SJC, ATTACHMENT 2 0 0 SCWD and MNWD (the "PC 2/AWT Members'). The PC 2/AWT Members desire to have SOCWA resume completion of the preliminary design and environmental review of the AWT Project, to be based upon the revised project phasing and participation as set forth in this Addendum 1 B. The AWT Project will be designed and constructed in one phase with a design capacity of 9.0 mgd, in lieu of the three phases and a design capacity of 11.0 mgd originally contemplated in the PC2/AW7 Agreement. SCWD and MNWD plan to ' Deleted: then own and use less capacity in the AWT Project,than originally set forth in the PC2/AWT Agreement, and SJC plans to own and use more capacity in the AWT Project then originally set forth in the PC 2/AWT Agreement. PC 2/AWT Member's currently contemplated capacities in the AWT Project are as follows: SCWD- 0.5 mgd; MNWD- 1.5 mgd; and, SJC- 7.0 mgd, for a total of 9.0 mgd in the AWT Project. C. Based on the '[SERRA]Jay B. Latham Plant Wastewater Capacity Allocations' set forth in the PC 2 Agreement, SCWD and MNWD will have excess secondary treated effluent available even after their participation in the AWT Project at the revised AWT capacity interests set forth in this Addendum 1, which otherwise will be discharged to the Pacific Ocean. SMWD will not participate in the AWT Project and the secondary treated effluent related to SMWD's wastewater capacity allocation and wastewater flows actually sent to the Plant by SMWD are discharged to the Pacific Ocean. Pursuant to this Addendum 1, SJC desires to secure assurances from MNWD,SCWD and SMWD that SJC may Jake if available a quantity of secondary Deleted; use as long as n Is treated effluent generated at the Plant sufficient to support the projected recycled water production resulting from SJC's capacity interest(s) in the AWT Project, subject to the forty year term on such assurances provided for hereafter. D. The PC 2/AWT Members( SJC, SCWD and MNWD) have reviewed alternative treatment processes for the AWT Project. In order to complete the Page -2- IlSNKG'PG'kin 99900 �700.SV222-6-II-06 Dra01 0 0 environmental review and the preliminary design for the AWT Project in a timely fashion so as to qualify for potential California State Proposition 50 grant funding in the magnitude of $5,000,000, the PC 2 Members desire to execute this Addendum 1 for the following purposes: (1) revise the project phasing and projected capacities of the PC 2/AWT Members previously set forth in PC 2/AWT Agreement, (2) provide for MNWD's ,and SCWD's consent to use of the available secondary treated effluent not otherwise needed by MNWD and SCWD to fully utilize their own respective capacities in the AWT Project, as well as SMWD's consent, to allow use of the available effluent by SJC in conjunction with its capacity in the AWT Project, and, (3) authorize the preliminary design and environmental review of the AWT Project in a timely manner so as to qualify for potential Proposition 50 grant funds, if and when such funds are available, and to otherwise authorize the funding of such design and environmental services. AGREEMENT The parties agree to revise the PC 2/AWT Agreement, including those certain sections of thereof as noted, as follows: 1. Revised Section 1 B "Protect Phases". Section 1 B, Table 2, which sets forth the proposed capacities of each PC 2/AWT Member in the project facilities, is amended to be as follows: AWT PROJECT CAPACITIES (PROJECTED) 2. Environmental Review Preliminary Design. The PC 2/AWT Members agree Page -3- HAW&C Kipp 78800 17005 N 222 -6 -II -06 Drerll Table 2 PC 2/AWT Member AWT Project Capacity m d Capacity Share SJC 7 77.78% MNWD 1.5 16.67% SCWD 0.5 5.56% Total 9.0 100,01% 2. Environmental Review Preliminary Design. The PC 2/AWT Members agree Page -3- HAW&C Kipp 78800 17005 N 222 -6 -II -06 Drerll SOCWA may proceed with the environmental review and the preliminary design of the AWT Project as revised by the terms of this Addendum 1, subject to the members' approval of the environmental services and design services contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Exhibit D (which Exhibit D will supercede the costs previously allocated to the members for preliminary design in Exhibit C to the PC 2/AWT Agreement) for the preliminary design and environmental review services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 1, within sixty (60) calendar days after the Effective Date of this Addendum 1 3, Revised Section 2B. Section 2B, "Funding Opportunities: Withdrawal", is amended as follows: "Section 2B. Funding Opportunities Withdrawal. Upon request by any PC 2/AWT Member, and at any such member's individual expense, SOCWA will pursue funding opportunities from available state or federal sources/programs for the AWT Project at the earliest possible date. It is agreed by the parties to this Amendment No. 2 that, subsequent to the completion of the preliminary design and environmental review, but prior to the award of the final design contract for the AWT Project, any PC 2/AWT Member may withdraw from participation in the AWT Project. In the case of a withdrawal, all further obligations of the withdrawing member shall cease as of the date of such withdrawal, except obligations of that member for expenses already incurred pursuant to this Amendment No. 2. Subject to the further approvals by the PC 2/AWT Members prior to Final Design and construction, the AWT Project shall be constructed and thereafter owned, operated, and maintained by SOCWA, through, on behalf of, and for the use and benefit of, the remaining PC 2/AWT Members." Page -4- 13,\W'ffiGPG,k,,7BN00 17005 V 22_'-6-I I-06 grafi l 0 0 5. Effluent Surplus. SMWD, MNWD and SCWD each agree that SJC may use effluent Jlows from, respectively, SMWD, MNWD and SCWD delivered to the Plant, but, in the case of MNWD and SCWD, only to the extent that such effluent flows exceed, the levels required for, respectively, MNWD's and SCWD's AWT Project capacities (collectively hereinafter," Surplus Effluent"). SMWD, MNWD, SCWD each will allow the use of its Surplus Effluent (hereinafter individually the "SMWD Effluent", the "MNWD Surplus Effluent" and the "SCWD Surplus Effluent) by SJC for such specific purpose, subject to the following conditions: (a) SJC's use of the Surplus Effluent will be deemed used on a proportionate basis as to the SMWD Surplus Effluent, the MNWD Surplus Effluent and the SCWD Surplus Effluent. Notwithstanding any other term set forth herein, SJC agrees that SMWD, MNWD and SCWD make no promises, assurances or guarantees that they will individually or collectively, deliver sufficient wastewater flows to the Plant so that the Surplus Effluent will continue to be available, or available in any specific quantity, for SJC's use in connection with the AWT Project as provided in Amendment No. 2, as supplemented by this Addendum 1. (b) SJC's use of the Surplus Effluent is restricted for use by SJC in connection with SJC's 7.0 mgd capacity in the AWT Project, and for no other purpose unless otherwise agreed to in writing by SMWD, MNWD, SCWD and SJC, and approved by Project Committee No. 2, if required. (c) In recognition of SJC's necessity for the Surplus Effluent to fully utilize its AWT Project capacity and therefore benefit from investment in its recycled water program, SMWD, MNWD and SCWD each agree to enter into timely good -faith discussions with SJC for purposes of determining if a permanent reduction in the available Surplus Effluent can be avoided should SMWD, MNWD or SCWD decide in Page -5- NAR'KG'PGkP 78800 17005 N > �2-6-11-06 Orad I Deleted: that is a byproduct of wastewater Deleted: s Deleted: send Deleted: on a means of avoiding any 0 the future to develop any facilities which will reduce the amount of wastewater Deleted: wnveyetl ,delivered to the Plant and therefore impact the available Surplus Effluent necessary for SJC to utilize its capacity in the AWT Project. (d) Notwithstanding any other term set forth in this Addendum 1, the consent given by SMWD, SCWD and MNWD to SJC's use of the Surplus Effluent, including the requirement set forth in subsection (d) of this Section 5, will terminate on a date forty (40) years from the Effective Date, unless otherwise agreed to in writing by the parties hereto. Upon expiration of such consent, SJC shall be limited to the quantity of effluent generated at the Plant resulting from wastewater flows conveyed to the Plant by SJC, unless or until otherwise agreed by the parties. 6. Substitution of SOCWA. All references to "SERRA" set forth in the PC 2/AWT Agreement are deemed to be references to SOCWA, as SERRA's successor - in -interest. 7. Delete CGvL Report The parties agree that the CGvL Report will not be incorporated as Attachment 1 in the PC 2/AWT Agreement. 8. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 1. Exhibit D is attached and incorporated into this Addendum 1. 9. Effect of Addendum 1. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the PC 2/AWT Agreement, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No.2 . the terms of this Addendum 1 shall control. The terms "PC 2 Agreement" and "PC 2/AWT Agreement" as used in such documents shall include this Addendum 1. Page -6- B � W &G,PGaM28su0 17005 N z 22-6-1 I-06 Dan I 0 10 10. Counterparts. This Addendum 1 may be executed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. THIS ADDENDUM 1 is entered into by each of the parties as of the Effective Date above. as SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 Chairman By Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA By Patricia B. Giannone Page -7- BA"&G PG kp 78800 17005 N 122-6-I I-06 DIA I 0 0 ATTEST: Margaret R. Monahan, City Clerk APPROVED AS TO FORM: John R. Shaw, City Attorney PC2/AWT MEMBERS: CITY OF SAN JUAN CAPISTRANO By: David M. Swerdlin, Mayor MOULTON NIGUEL WATER DISTRICT President Secretary SOUTH COAST WATER DISTRICT By President/Vice-President By Secretary/Assistant Secretary PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT By President/Vice-President By Secretary/Assistant Secretary Page -8- BAW@O-PGS p 78800 17005 N 2 22- 6-11-06 Dnfl I 0 EXHIBIT D PC 2/AWT Members Environmental and Preliminary Design Services Budget Allocations 0 PC2/AWT Member Capacity (mgd) Capacity Share Share of PDR Costs Share of CEQA Costs Total Costs SCWD 0.5 5.56% $4,722 $3,611 $8,333.00 MNWD 1.5 16.67% $14,167 $10,833 $25,000.00 SJC 7.0 77.78% $66,111 $50,556 $116,667.00 Total 9.0 1 100.00% $85,000 1 $65,000 $150,000.00 Page -9- BA W&G PG6p79800 17005 N' 22-6-11-06 DWI I 0 ADDENDUM 1 TO AMENDMENT NO. 2 10 AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 2 (THE "PC 2 AGREEMENT') (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 1 to Amendment No. 2 to the PC 2 Agreement (hereinafter the "PC 2/AWT Agreement') is made effective this _ day of August, 2006 (the "Effective Date"), by and among South Orange County Wastewater Authority ("SOCWA") (the successor in -interest to South East Regional Reclamation Authority (SERRA)), a joint power agency created by that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority, Orange County, California (SOCWA)" dated July 1, 2001 (the "Joint Powers Agreement'), and pursuant to Section 6500 and following of the Government Code of the State of California, for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC"); (b) South Coast Water District ("SCWD"); (c) Moulton Niguel Water District ("MNWD"); and (d) Santa Margarita Water District ("SMWD"). RECITALS A. The PC 2 members entered into the PC2/AWT Agreement to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities (the "AWT Project') at the Jay B. Latham Plant (formerly referred to as the "SERRA Plant', to be referred to as the "Plant' herein) site for the diversion of up to 11.0 mgd of secondary effluent produced at the Plant from discharge to the Pacific Ocean and treatment of such effluent for beneficial reuse as recycled water. The PC 2 Members who will fund, and thereafter have capacity interests in, the AWT Project are SJC, ATTACHMENT 0 0 SCWD and MNWD (the "PC 2/AWT Members"). The PC 2/AWT Members desire to have SOCWA resume completion of the preliminary design and environmental review of the AWT Project, to be based upon the revised project phasing and participation as set forth in this Addendum 1. B. The AWT Project will be designed and constructed in one phase with a design capacity of 9.0 mgd, in lieu of the three phases and a design capacity of 11.0 mgd originally contemplated in the PC2/AWT Agreement. SCWD and MNWD plan to own and use less capacity in the AWT Project than originally set forth in the PC2/AWT Agreement, and SJC plans to own and use more capacity in the AWT Project then originally set forth in the PC 2/AWT Agreement. PC 2/AWT Member's currently contemplated capacities in the AWT Project are as follows: SCWD- 0.5 mgd; MNWD- 1.5 mgd; and, SJC- 7.0 mgd, for a total of 9.0 mgd in the AWT Project. C. Based on the '[SERRA]Jay B. Latham Plant Wastewater Capacity Allocations' set forth in the PC 2 Agreement, SCWD and MNWD will have excess secondary treated effluent available even after their participation in the AWT Project at the revised AWT capacity interests set forth in this Addendum 1, which otherwise will be discharged to the Pacific Ocean. SMWD will not participate in the AWT Project and the secondary treated effluent related to SMWD's wastewater capacity allocation and wastewater flows actually sent to the Plant by SMWD are discharged to the Pacific Ocean. Pursuant to this Addendum 1, SJC desires to secure assurances from MNWD,SCWD and SMWD that SJC may take if available a quantity of secondary treated effluent generated at the Plant sufficient to support the projected recycled water production resulting from SJC's capacity interest(s) in the AWT Project, subject to the forty year term on such assurances provided for hereafter. D. The PC 2/AWT Members (SJC, SCWD and MNWD) have reviewed alternative treatment processes for the AWT Project. In order to complete the Page -2- HA W &G/PG/kp/78800 17005N2.22 -6 -II -06 DraftI 0 0 environmental review and the preliminary design for the AWT Project in a timely fashion so as to qualify for potential California State Proposition 50 grant funding in the magnitude of $5,000,000, the PC 2 Members desire to execute this Addendum 1 for the following purposes: (1) revise the project phasing and projected capacities of the PC 2/AWT Members previously set forth in PC 2/AWT Agreement; (2) provide for MNWD's ,and SCWD's consent to use of the available secondary treated effluent not otherwise needed by MNWD and SCWD to fully utilize their own respective capacities in the AWT Project, as well as SMWD's consent, to allow use of the available effluent by SJC in conjunction with its capacity in the AWT Project; and, (3) authorize the preliminary design and environmental review of the AWT Project in a timely manner so as to qualify for potential Proposition 50 grant funds, if and when such funds are available, and to otherwise authorize the funding of such design and environmental services. AGREEMENT The parties agree to revise the PC 2/AWT Agreement, including those certain sections of thereof as noted, as follows: 1. Revised Section 1 B "Project Phases". Section 1 B, Table 2, which sets forth the proposed capacities of each PC 2/AWT Member in the project facilities, is amended to be as follows: AWT PROJECT CAPACITIES (PROJECTED) Table 2 PC 2/AWT Member AWT Project Capacity m d Capacity Share SJC 7 77.78% MNWD 1.5 16.67% SCWD 0.5 5.56% Total 9.0 100.0% 2. Environmental Review; Preliminary Design. The PC 2/AWT Members agree Page -3- BA W &G/PG/kp/78800 17005 N 222- 6-11-06 Draft I u n U SOCWA may proceed with the environmental review and the preliminary design of the AWT Project as revised by the terms of this Addendum 1, subject to the members' approval of the environmental services and design services contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Exhibit D (which Exhibit D will supercede the costs previously allocated to the members for preliminary design in Exhibit C to the PC 2/AWT Agreement) for the preliminary design and environmental review services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 1, within sixty (60) calendar days after the Effective Date of this Addendum 1. 3, Revised Section 2B. Section 213, "Funding Opportunities: Withdrawal", is amended as follows: "Section 2B. Funding Opportunities: Withdrawal. Upon request by any PC 2/AWT Member, and at any such member's individual expense, SOCWA will pursue funding opportunities from available state or federal sources/programs for the AWT Project at the earliest possible date. It is agreed by the parties to this Amendment No. 2 that, subsequent to the completion of the preliminary design and environmental review, but prior to the award of the final design contract for the AWT Project, any PC 2/AWT Member may withdraw from participation in the AWT Project. In the case of a withdrawal, all further obligations of the withdrawing member shall cease as of the date of such withdrawal, except obligations of that member for expenses already incurred pursuant to this Amendment No. 2. Subject to the further approvals by the PC 2/AWT Members prior to Final Design and construction, the AWT Project shall be constructed and thereafter owned, operated, and maintained by SOCWA, through, on behalf of, and for the use and benefit of, the remaining PC 2/AWT Members." Page -4- BA W &G/PGAp/78800 17005 N 2 22- 6-11-06 Draft I 0 0 5. Effluent Surplus. SMWD, MNWD and SCWD each agree that SJC may use effluent flows from, respectively, SMWD, MNWD and SCWD delivered to the Plant, but, in the case of MNWD and SCWD, only to the extent that such effluent flows exceed the levels required for, respectively, MNWD's and SCWD's AWT Project capacities (collectively hereinafter," Surplus Effluent"). SMWD, MNWD, SCWD each will allow the use of its Surplus Effluent (hereinafter individually the "SMWD Effluent", the "MNWD Surplus Effluent" and the "SCWD Surplus Effluent) by SJC for such specific purpose, subject to the following conditions: (a) SJC's use of the Surplus Effluent will be deemed used on a proportionate basis as to the SMWD Surplus Effluent, the MNWD Surplus Effluent and the SCWD Surplus Effluent. Notwithstanding any other term set forth herein, SJC agrees that SMWD, MNWD and SCWD make no promises, assurances or guarantees that they will individually or collectively deliver sufficient wastewater flows to the Plant so that the Surplus Effluent will continue to be available, or available in any specific quantity, for SJC's use in connection with the AWT Project as provided in Amendment No. 2, as supplemented by this Addendum 1. (b) SJC's use of the Surplus Effluent is restricted for use by SJC in connection with SJC's 7.0 mgd capacity in the AWT Project, and for no other purpose unless otherwise agreed to in writing by SMWD,MNWD, SCWD and SJC, and approved by Project Committee No. 2, if required. (c) In recognition of SJC's necessity for the Surplus Effluent to fully utilize its AWT Project capacity and therefore benefit from investment in its recycled water program, SMWD, MNWD and SCWD each agree to enter into timely good -faith discussions with SJC for purposes of determining if a permanent reduction in the available Surplus Effluent can be avoided should SMWD, MNWD or SCWD decide in Page -5- B A W &G/PG/kp/78800 17005 N 2 22- 6-11-06 Draft I 0 0 the future to develop any facilities which will reduce the amount of wastewater delivered to the Plant and therefore impact the Surplus Effluent necessary for SJC to utilize its capacity in the AWT Project. (d) Notwithstanding any other term set forth in this Addendum 1, the consent given by SMWD, SCWD and MNWD to SJC's use of the Surplus Effluent, including the requirement set forth in subsection (d) of this Section 5, will terminate on a date forty (40) years from the Effective Date, unless otherwise agreed to in writing by the parties hereto. Upon expiration of such consent, SJC shall be limited to the quantity of effluent generated at the Plant resulting from wastewater flows conveyed to the Plant by SJC, unless or until otherwise agreed by the parties. 6. Substitution of SOCWA. All references to "SERRA" set forth in the PC 2/AWT Agreement are deemed to be references to SOCWA, as SERRA's successor - in -interest. 7. Delete CGvL Report The parties agree that the CGvL Report will not be incorporated as Attachment 1 in the PC 2/AWT Agreement. 8. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 1. Exhibit D is attached and incorporated into this Addendum 1. 9. Effect of Addendum 1. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the PC 2/AWT Agreement, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No.2 , the terms of this Addendum 1 shall control. The terms "PC 2 Agreement" and "PC 2/AWT Agreement" as used in such documents shall include this Addendum 1. Page -6- Idn W &G/PG/kp/78800 17005 N 2 22- 6-11-06 Draft I 0 0 10. Counterparts. This Addendum 1 may be executed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. THIS ADDENDUM 1 is entered into by each of the parties as of the Effective Date above. LIM SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 Chairman 0 Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA al Patricia B. Giannone Page -7- BAW&G/PG/kp/78&10 17005 N 2.22- 6-11-06 Draft I PC2/AWT MEMBERS: CITY OF SAN JUAN CAPISTRANO By: David M. Swerdlin, Mayor ATTEST: Margaret R. Monahan, City Clerk APPROVED AS TO FORM: MOULTON NIGUEL WATER DISTRICT By President By Secretary SOUTH COAST WATER DISTRICT By President/Vice-President By Secretary/Assistant Secretary PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT By President/Vice-President By Secretary/Assistant Secretary Page -8- aA W&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 0 0 EXHIBIT D PC 2/AWT Members Environmental and Preliminary Design Services Budget Allocations PC2/AWT Member Capacity (mgd) Capacity Share Share of PDR Costs Share of CEQA Costs Total Costs SCWD 0.5 5.56% $4,722 $3,611 $8,333.00 MNWD 1.5 16.67% $14,167 $10,833 $25,000.00 SJC 7.0 77.78% $66,111 $50,556 $116,667.00 Total 9.0 100.00% $85,000 $65,000 $150,000.00 Page -9- BA W &G/PG/kp/78800 17005 N 222- 6-11-06 Draft I 0 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493-1053 1 www sanjuancapistrano. org IA[XRPXARIfO fS1A111fXIX 1961 1776 MEMBERS OF THE CITY COUNCIL NOTIFICATION OF MEETING OF POTENTIAL INTEREST OF THE SAN JUAN CAPISTRANO CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONDRES USO The City Council of San Juan Capistrano will meet at 7:00 p.m. on May 15, 2007 in the City Council Chamber in City Hall, to consider: "Consideration of the Conformed Addendum No. 1 to Amendment No. 2 of the Project Committee No. 2 Agreement (South Orange County Wastewater Authority)(CIP No. 787)" — Item No. D7. If you have specific thoughts or concerns regarding this item, you are encouraged to participate in this decision making process. You can communicate with the City Council through correspondence addressed to the Council and/or by attending the meeting and speaking to the Council during the public meeting. Correspondence related to this item must be received at the City Clerk's office by 5:00 p.m. on Monday, May 14, 2007 to allow time for the Council to consider its content. If you would like to speak at the meeting, please complete a yellow "Request to Speak" form found inside the entrance to the Council Chamber. This form is turned in at the staff table, just in front of the Council dais. You will be called to speak by the Mayor when the item is considered. You have received this notice at the request of the City staff member Eric P. Bauman, Water Engineering Manager. You may contact that staff member at (949) 487-4312 with any questions. The agenda, including agenda reports, is available to you on our web site: www.sanouancapistrano.org. If you would like to subscribe to receive a notice when agendas are posted to the web site, please make that request by sending an e-mail to: cityclerk@ sa n i ua ncapistra no.org. Meg Monahan, MMC City Clerk cc: South Orange County Wastewater Authority; Moulton Niguel Water District; South Coast Water District; Cindy Russell, Interim Director of Public Works; Eric P. Bauman, Water Engineering Manager Received staff report San Juan Capistrano: Preserving the Past to Enhance the Future 0 Printed on recycled paper 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92875 (949) 493-1171 (949) 493.10531 www.sanjuancapistrano.org May 16, 2007 u dwan �y mcoaronauo • m euseEo 1961 1776 NOTIFICATION OF ACTION BY THE CITY COUNCIL OF SAN JUAN CAPISTRANO MEMBERS OF THE CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONDRES USO On May 15, 2007, the City Council of San Juan Capistrano met regarding: "Consideration of the Conformed Addendum No. 1 to Amendment No. 2 of the Project Committee No. 2 Agreement (South Orange County Wastewater Authority)(CIP No. 787)" Item No. D7. The following action was taken at the meeting: Conformed version of Addendum No. 1 to Amendment No. 2 of the South Orange County Wastewater Authority Project Committee No. 2 agreement, approved If you have any questions regarding this action, please contact Eric P. Bauman, Water Engineering Manager at (949) 487-4312 for more detailed information. Thank you, 11— Meg M a n, MMC City lerk Cc: South Orange County Wastewater Authority; Moulton Niguel Water District; South Coast Water District; Cindy Russell, Interim Director of Public Works; Eric P. Bauman, Water Engineering Manager San Juan Capistrano: Preserving the Past to Enhance the Future 0 Printed on 100% recycled paper is 32400 PASEO ADEII SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493.1053 FAX www.sanjuancapistrano.org TRANSMITTAL TO: SOCWA 34156 Del Obispo Dana Point, CA 92629 DATE: May 25, 2007 FROM: Maria Morris, Deputy City Clerk (949) 443-6309 MEMBERS OF THE CITY COUNCIL SAM ALLEVATO THOMAS W. HRIBAR MARK NIELSEN JOE SOTO DR. LONDRES USO RE: Addendum No. 1 to Amendment No. 2 — Advanced Wastewater Treatment Project — Project Committee No. 2/AWT Enclosed is a copy of the above referenced document and two (2) originals addendums. Please after executing send our office a fully executed original for our records. If you have questions concerning the agreement, please contact Eric Bauman, Water Engineering Manager (949) 487-4312. Cc: Eric Bauman, Water Engineering Manager San Juan Capistrano: Preserving the Past to Enhance the Future 0 Prinletl on 100% recycled paper 0 0 ADDENDUM 1 TO AMENDMENT NO. 2 AGREEMENT FOR ACQUISITION, USE, OPERATION, MAINTENANCE AND EXPANSION OF SEWAGE TREATMENT PLANT OF CITY OF SAN JUAN CAPISTRANO BY SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 2 (THE "PC 2 AGREEMENT") (Advanced Wastewater Treatment Project: Project Committee No. 2/AWT) This ADDENDUM 1 to Amendment No. 2 to the PC 2 Agreement (hereinafter the "PC 2/AWT Agreement") is made effective this _ day of August, 2006 (the "Effective Date"), by and among South Orange County Wastewater Authority ("SOCWA") (the successor in -interest to South East Regional Reclamation Authority (SERRA)), a joint power agency created by that certain joint powers agreement entitled "Joint. Exercise of Powers Agreement Creating South Orange County Wastewater Authority, Orange County, California (SOCWA)" dated July 1, 2001 (the "Joint Powers Agreement"), and pursuant to Section 6500 and following of the Government Code of the State of California, for and on behalf of its Project Committee No. 2 ("PC 2"), and the following member agencies of SOCWA and members of PC 2: (a) City of San Juan Capistrano ("SJC"); (b) South Coast Water District ("SCWD"); (c) Moulton Niguel Water District ("MNWD"); and (d) Santa Margarita Water District ("SMWD"). RECITALS A. The PC 2 members entered into the PC2/AWT Agreement to provide for the design, construction and operation of advanced wastewater (tertiary) treatment facilities (the "AWT Project") at the Jay B. Latham Plant (formerly referred to as the "SERRA Plant", to be referred to as the "Plant" herein) site for the diversion of up to 11.0 mgd of secondary effluent produced at the Plant from discharge to the Pacific Ocean and treatment of such effluent for beneficial reuse as recycled water. The PC 2 Members who will fund, and thereafter have capacity interests in, the AWT Project are SJC, 0 0 SCWD and MNWD (the "PC 2/AWT Members"). The PC 2/AWT Members desire to have SOCWA resume completion of the preliminary design and environmental review of the AWT Project, to be based upon the revised project phasing and participation as set forth in this Addendum 1. B. The AWT Project will be designed and constructed in one phase with a design capacity of 9.0 mgd, in lieu of the three phases and a design capacity of 11.0 mgd originally contemplated in the PC2/AWT Agreement. SCWD and MNWD plan to own and use less capacity in the AWT Project than originally set forth in the PC2/AWT Agreement, and SJC plans to own and use more capacity in the AWT Project then originally set forth in the PC 2/AWT Agreement. PC 2/AWT Member's currently contemplated capacities in the AWT Project are as follows: SCWD- 0.5 mgd; MNWD- 1.5,mgd; and, SJC- 7.0 mgd, for a total of 9.0 mgd in the AWT Project. C. Based on the '[SERRA]Jay B. Latham Plant Wastewater Capacity Allocations' set forth in the PC 2 Agreement, SCWD and MNWD will have'excess secondary treated effluent available even after their participation in the AWT Project at the revised AWT capacity interests set forth in this Addendum 1, which otherwise will be discharged to the Pacific Ocean. SMWD will not participate in the AWT Project and the secondary treated effluent related to SMWD's wastewater capacity allocation and wastewater flows actually sent to the Plant by SMWD are discharged to the Pacific Ocean. Pursuant to this Addendum 1, SJC desires to secure assurances from MNWD,SCWD and SMWD that SJC may take if available a quantity of secondary treated effluent generated at the Plant sufficient to support the projected recycled water production resulting from SJC's capacity interest(s) in the AWT Project, subject to the forty year term on such assurances provided for hereafter. D. The PC 2/AWT Members (SJC, SCWD and MNWD) have reviewed alternative treatment processes for the AWT Project. In order to complete the Page -2- BAW&G/PG/kp/78800 - - 17005 N 2.22- 6-11-06 Draft 1 environmental review and the preliminary design for'the AWT Project in a timely fashion so as to qualify for potential California State Proposition 50 grant funding in the magnitude of $5,000,000, the PC 2 Members desire to execute this Addendum 1 for the following purposes: (1) revise the project phasing and projected capacities of the PC 2/AWT Members previously set forth in PC 2/AWT Agreement; (2) provide for MNWD's ,and SCWD's consent to use of the available secondary treated effluent not otherwise needed by MNWD and SCWD to fully utilize their own respective capacities in the AWT Project, as well as SMWD's consent, to allow use of the available effluent by SJC in conjunction with its capacity in the AWT Project; and, (3) authorize the preliminary design and environmental review of the AWT Project in a timely manner so as to qualify for potential Proposition 50 grant funds, if and when such funds are available, and to otherwise authorize the funding of such design and environmental services. AGREEMENT The parties agree to revise the PC 2/AWT Agreement, including those certain sections of thereof as noted, as follows: 1. Revised Section 1 B "Project Phases". Section 16, Table 2, which sets forth the proposed capacities of each PC 2/AWT Member in the project facilities, is amended to be as follows: AWT PROJECT CAPACITIES (PROJECTED) Table 2 PC 2/AWT Member AWT Project Capacity m d Capacity Share SJC 7 77.78% MNWD 1.5 16.67% SCWD 0.5 5.56% Total 9.0 100.0% 2. Environmental Review: Preliminary Design. The PC 2/AWT Members agree Page -3- BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 SOCWA may proceed with the environmental review and the preliminary design of the AWT Project as revised by the terms of this Addendum 1, subject to the members' approval of the environmental services and design services contract(s) for such work. The PC 2/AWT Members agree to deposit with SOCWA the budgeted amounts specified in Exhibit D (which Exhibit D will supercede the costs previously allocated to the members for preliminary design in Exhibit C to the PC 2/AWT Agreement) for the preliminary design and environmental review services, and to further deposit all other associated costs for SOCWA's legal review of such matters, including preparation of this Addendum 1, within sixty (60) calendar days after -the Effective Date of this Addendum 1. 3. Revised Section 2B. Section 26, "Funding Opportunities; Withdrawal", is amended as follows: "Section' 2B. Funding Opportunities: Withdrawal. Upon request by any PC 2/AWT Member, and at any such member's individual expense, SOCWA will pursue funding opportunities from available state or federal sources/programs for the AWT Project at the earliest possible date. It is agreed by the parties to this Amendment No. 2 that, subsequent to the completion of the preliminary design and environmental review, but prior to the award of the final design contract for the AWT Project, any PC 2/AWT Member may withdraw from participation in the AWT Project. In the case of a withdrawal, all further obligations of the withdrawing member shall cease as of the date of such withdrawal, except obligations of that member for expenses already incurred pursuant to this Amendment No. 2. Subject to the further approvals by the PC 2/AWT Members prior to Final Design and construction, the AWT Project shall be constructed and thereafter owned, operated, and maintained by SOCWA, through, on behalf of, and for the use and benefit of, the remaining PC 2/AWT Members." Page -4- BAW&G/PG/kpn8800 17005 N 2.22- 6-11-06 Draft 1 0 0 5. Effluent Surplus. SMWD, MNWD and SCWD each agree that SJC may use effluent flows from, respectively, SMWD, MNWD and SCWD delivered to the Plant, but, in the case of MNWD and SCWD, only to the extent that such effluent flows exceed the levels required for, respectively, MNWD's and SCWD's AWT Project capacities (collectively hereinafter," Surplus Effluent"). SMWD, MNWD, SCWD each will allow the use of its Surplus Effluent (hereinafter individually the "SMWD Effluent", the "MNWD Surplus Effluent" and the "SCWD Surplus Effluent) by SJC for such specific purpose, subject to the following conditions: (a) SJC's use of the Surplus Effluent will be deemed used on a proportionate basis as to the SMWD Surplus Effluent, the MNWD Surplus Effluent and the SCWD Surplus Effluent. Notwithstanding any other term set forth herein, SJC agrees that SMWD, MNWD and SCWD make no promises, assurances or guarantees that they will individually or collectively deliver sufficient wastewater flows to the Plant so that the Surplus Effluent will continue to be available, or available in any specific quantity, for SJC's use in connection with the AWT Project as provided in Amendment No. 2, as supplemented by this Addendum 1. (b) SJC's use of the Surplus Effluent is restricted for use by SJC in connection with SJC's 7.0 mgd capacity in the AWT Project, and for no other purpose unless otherwise agreed to in writing by SMWD,MNWD, SCWD and SJC, and approved by Project Committee No. 2, if required. (c) In recognition of SJC's necessity for the Surplus Effluent to fully utilize its AWT Project capacity and therefore benefit from investment in its recycled water program, SMWD, MNWD and SCWD each agree to enter into timely good -faith discussions with SJC for purposes of determining if a permanent reduction in the available Surplus Effluent can be avoided should SMWD, MNWD or SCWD decide in Page -5- BAWR.G/PG/kp/78800 - 17005 N 2.22-6-I1-06 Draft I 0 0 the future to develop any facilities which will reduce the amount of wastewater delivered to the Plant and therefore impact the Surplus Effluent necessary for SJC to utilize its capacity in the AWT Project. (d) Notwithstanding any other term set forth in this Addendum 1, the consent given by SMWD, SCWD and MNWD to SJC's use of the Surplus Effluent, including the requirement set forth in subsection (d) of this Section 5, will terminate on a date forty (40) years from the Effective Date, unless otherwise agreed to in writing by the parties hereto. Upon expiration of such consent, SJC shall be limited to the quantity of effluent generated at the Plant resulting from wastewater flows conveyed to the Plant by SJC, unless or until otherwise agreed by the parties. 6. Substitution of SOCWA. All references to `SERRA" set forth in the PC 2/AWT Agreement are deemed to be references to SOCWA, as SERRA's successor - in -interest. 7. Delete CGvL Report The parties agree that the CGvL Report will not be incorporated as Attachment 1 in the PC 2/AWT Agreement. 8. Recitals/Exhibits. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Addendum 1. Exhibit D is attached and incorporated into this Addendum 1. 9. Effect of Addendum 1. Except as modified herein, all other terms and conditions of the PC 2 Agreement, including the PC 2/AWT Agreement, shall remain in full force and effect. In the event of any conflict or inconsistency between Amendment No.2 , the terms of this Addendum 1 shall control. The terms "PC 2 Agreement" and "PC 2/AWT Agreement" as used in such documents shall include this Addendum 1. Page -6- BAW&G/PG/kpn8800 17005 N 2.22- 6-11-06 Draft 1 l L 10. Counterparts. This Addendum 1 may be executed in counterparts, each of which shall constitute an original and which collectively shall constitute one instrument. THIS ADDENDUM 1 is entered into by each of the parties as of the Effective Date above. z SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 2 Chairman LIM Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA Patricia B. Giannone Page -7- BAW&G/PGAPM800 17005 N 2.22-6-11-06 Draft 1 u APPROVED AS TO FORM: John R. Shaw, City Attorney BAW&G/PG/kp/78800 17005 N 2.22- 6-11-06 Draft 1 0 PC2/AWT MEMBERS: CITY O7.7 CAPISTRANO By. Sam Allevato, Mayor MOULTON NIGUEL WATER DISTRICT By President By Secretary SOUTH COAST WATER DISTRICT By President/Vice-President L0 Secretary/Assistant Secretary. PC 2 MEMBER: SANTA MARGARITA WATER DISTRICT President/Vice-President By Secretary/Assistant Secretary Page -8- 0 EXHIBIT D PC 2/AWT Members Environmental and Preliminary Design Services Budget Allocations Page -9- BAW&G/PG/kp/78800 - 17005 N 2:22- 6-11-06 Draft t - Total Costs PC2/AWT Member Capacity (mgd) Capacity Share Share of PDR Costs Share of CEQA Costs SCWD 0.5 5.56% $4,722 $3,611 $8,333.00 MNWD 1 1.5 1 16.67% $14,167 $10,833 $25,000.00 SJC 1 7.0 1 77.78% $66,111 $50,556 $116,667.00 Total 1 9.0 1 100.00% $85,000 $65,000 $150,000.00 Page -9- BAW&G/PG/kp/78800 - 17005 N 2:22- 6-11-06 Draft t - Today's Date: • Transmittal Routing (Check All That Apply) ❑ City Attorney ❑ City Manager ® City Clerk CONTRACT TRANSMITTAL CIP No. (if any): -is I Project Manager's Last Name: Council or CRA Meeting Date (if applicable): 110V APP VING AUTHORITY: (Check One) 7Mayor ❑ CRA Chair ❑ City Manager Phone Extension: ¢�/2— Provide (1) executed original contract for each signing party, including the City. If the agreement is to be recorded — only (1) original will be recorded with certified copies going to other parties. Please provide the mailing address of any party to receive an agreement — unless the mailing address is included within the body of the agreement: Names Street Ci St Zi Ido (del DIA OTHER INSTRUCTIONS: Form Date: 01-2004 D-7 9 0 10/17/2006 AGENDA REPORT TO: Dave Adams, City Manager FROM: Nasser Abbaszadeh, Engineering and Building Director SUBJECT: Consideration of Approval of Amendment No. 4 to South Orange County Wastewater Authority's (SOCWA) Project Committee No. 5 (PC5) Agreement: Use of Outfall Capacity by City of San Clemente for Disposal of Treated Urban Runoff Discharge. RECOMMENDATION: By motion, approve Amendment No. 4 to the SOCWA's PC5 Agreement to permit and recognize the use of the City of San Clemente's capacity in the San Juan Creek Outfall for the disposal of treated dry weather flows by the City under the terms in Amendment No. 4 and as specified in the provisions of the NPDES permit; and authorize the Mayor to execute the agreement. A. Summary and Recommendation The City of San Clemente requests SOCWA's PC5 Committee approval of the discharge of treated dry weather flows into San Juan Creek Outfall. Staff recommends the approval of Amendment No. 4 to SOCWA's PC5 Agreement. B. Background: A The City of San Clemente has developed an urban water management program with an objective of improving water quality at the City's beaches and into the surf zone. One of the primary drainage facilities is the Segunda Deshecha (M02) Flood Control Channel that discharges dry and wet weather flows onto North Beach and flows directly into the ocean. The dry weather flows are a contributor to beach postings due to bacteria levels in the nuisance water. The City has obtained a grant from Proposition 40 for the Clean Beach Grant Program from the State Water Resources Control Board for this project. The City and its consultant evaluated several options to mitigate the impact of urban dry weather nuisance flows from the Segunda Deshecha Channel. During recent construction improvements to the M02 channel, the County of Orange has constructed a low flow drop structure immediately downstream of Avenida Pico for future diversion of flows to a treatment facility. Various options were considered including diversion of dry weather flows to the City's land outfall (ties into the SOCWA ocean outfall), treatment of dry weather flows and discharge to North Beach past the existing M02 outlet where water Agenda Report • October 17, 2006 Paae 2 currently ponds, and diversion to the City's wastewater treatment plant headworks. The preferred alternative is to divert dry weather flows through filtration and then discharge to the land outfall. If permitted and funding is available, the City may also expand treatment by adding a UV system for disinfection and construct a pipeline to the beach for discharge of treated urban runoff downstream of M02 channel outlet as a secondary method of disposal. Operations The City plans to operate the facility on a year round basis. However, only dry weather flows would be treated and discharged to the outfall. During storm events, the City would either need to manually shut the treatment facilities down, or the dry weather pump station at the channel would automatically be shut down. The pumps would automatically be shut down if the water in the channel and wet well pump station rises above a certain elevation or the influent turbidity in the M02 channel increases above a specified set point level. Project consent and permitting When the City of San Juan Capistrano proposed the brine discharge into SOCWA's outfall, it was facilitated via Amendment 3 to the PC 5 agreement in January 2002, the City of San Clemente Segunda Deshecha Channel Urban Runoff Diversion Project requires the consent of the other Project Committee 5 members. • Outfall capacity is not an issue. Based on the capacity ownership percentages set forth in Amendment No. 3, the City of San Clemente has sufficient outfall ownership to facilitate this Project. • An amendment requires not only Project Committee approval, but also individual Member Agency Board approvals. Pat Giannone, SOCWA's legal counsel, utilized very similar language, found in Amendment 3, to prepare Amendment No. 4. • This project, and the associated permit monitoring requirements, have been addressed in the new NPDES outfall permit — Order R9-2006-0054. COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: N/A FINANCIAL CONSIDERATIONS: No financial impact NOTIFICATION: Tom Rosales, SOCWA General Manager' * Agenda Report included Agenda Report • • Paqe 3 RECOMMENDATION: October 17. 2006 Approve and Execute Amendment No. 4 to the SOCWA's PC5 Agreement to permit and recognize the use of the City of San Clemente's capacity in the San Juan Creek Outfall for the disposal of treated dry weather flows by the City under the terms in Amendment No. 4 and as specified in the provisions of the NPDES permit. Respectfully submitted, Nasser Abbaszadeh, PE Engineering and Building Director Attachment(s): 1. Amendment No. 4 of SOCWA's PC5 Prepared by, Ziad Mazboudi, PE Senior Civil Engineer 0 0 AMENDMENT NO. 4 AGREEMENT FOR ACQUISITION OF CAPACITY, CONSTRUCTION, USE, OPERATION, AND MAINTENANCE OF OUTFALL FACILITIES FOR SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 5 ("PC 5 AGREEMENT") This Amendment No. 4 to the PC 5 Agreement is effective as of the date of 12006 ( "Effective Date"), by and between South Orange County Wastewater Authority (SOCWA), a joint powers authority under Government Code Section 6500 et seq. and that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority Orange County, California (SOCWA) and Terminating Aliso Water Management Agency, South East Regional Reclamation Authority, South Orange County Reclamation Authority" dated July 1, 2001, ( "Joint Powers Agreement') and the following member agencies of SOCWA and its Project Committee No. 5: (a) City San Clemente (CSC); (b) City San Juan Capistrano (SJC); (c) Moulton Niguel Water District (MNWD); (d) Santa Margarita Water District (SMWD); and (e) South Coast Water District (SCWD). SOCWA is the successor -in -interest to the South East Regional Reclamation Authority under the PC 5 Agreement and for all other purposes. The foregoing entities are in some instances referred to individually as the "PC 5 Member" or collectively as the "PC 5 Members", which term is also defined to include all predecessors -in -interest to the individual PC 5 Members, as applicable, or individually as "party" and collectively or in combination as "parties". The parties are member agencies of SOCWA and Project Committee No. 5, and are signatories to the Joint Powers Agreement. RECITALS A. SOCWA is pursuing in the most beneficial economically and environmentally compatible manner, a regional program for wastewater collection, treatment, reclamation, reuse, disposal and management, including but not limited to that facility known as the SOCWA San Juan Creek Ocean Outfall ( "SJCO Outfall"). Project Committee No. 5 was previously created for the purpose of constructing and operating the SJCO Outfall, all in accordance with the PC 5 Agreement. B. SERRA and the PC 5 Members previously executed the PC 5 Agreement, dated ATTACHMENT 1 0 0 August 18, 1977, as well as the November 10, 1977 Addendum, the March 10, 1988 Amendment No. One, the March 14, 1991 Amendment No. Two and the February 7, 2002 Amendment No. 3, thereto. The term "PC 5 Agreement" as used in this Amendment No. 4 shall include the 1977 Agreement referenced above and the 1977 Addendum, 1988 Amendment No. One, 1991 Amendment No. Two, 2002 Amendment No. 3 and this Amendment No. 4 upon approval and execution thereof. C The capacity ownership percentages of the PC 5 Members in the SJCO Outfall are set forth in the PC 5 Agreement, as follows: City of San Clemente (CSC) - 16.62% City of San Juan Capistrano (SJC) - 11.08% Moulton Niguel Water District (MNWD) - 15.51% Santa Margarita Water District (SMWD) - 44.32% South Coast Water District (SCWD) - 12.47% D. Pursuant to 2002 Amendment No. 3, the PC 5 Members agreed that, for all purposes, the design capacity of the SJCO Outfall is 80 mgd Peak Flow. This capacity of 80 mgd Peak Flow was based on the PC 5 Members' review and evaluation of the Wm. Lea Fisher report entitled "SERRA Outfall and Pump Station Capacity Evaluation and Cost Allocation Report," dated May 1, 1990, as supplemented by Fisher's report entitled "SERRA Outfall Pressure Rating," dated January 28, 1991. Based on the ownership percentages in Recital E above, the capacity interests of each PC 5 Member in the total 80 mgd Peak Flow SJCO Outfall capacity was agreed as follows: CSC 16.62% 13.30 mgd Peak Flow SJC 11.08% 8.86 mgd Peak Flow MNWD 15.51% 12.41 mgd Peak Flow SMWD 44.32% 35.46 mgd Peak Flow SCWD 12.47% 9.97 mgd Peak Flow E. The current SOCWA National Pollution Discharge Elimination System (NPDES) Permit (San Diego Regional Water Quality Control Board Order No. R9-2006-0054, NPDES No. CA0107417, expiration date October 1, 2011) for the SJCO Outfall ("SJCO NPDES Permit") permits a calendar -monthly average effluent daily flow rate limitation of 36.385 million gallons per day (mgd), as may be modified from time -to -time, which limitation applies to the PC 5 Members' use of permitted flows on an aggregate basis under such permit terms. F. PC 5 Member CSC has developed an urban water management plan to improve 2 BAWG/112468v2 17108 N 10 8-29-06 0 0 water quality at CSC's beaches and the surf zone. CSC's Segunda Desheca (M02) Flood Control Channel ("Segunda Desheca Channel") is one of CSC's primary drainage facilities, and discharges flows onto North Beach and directly into the ocean. CSC is undertaking its "Segunda Desheca Channel Urban Runoff Diversion Project" ("Diversion Project") that will result in projected dry weather flows of approximately 1.5 cfs (1 mgd) of filtered urban runoff flows ("Runoff Discharge") through CSC's Land Outfall, with ultimate disposal to the SJCO Outfall. G. The PC 5 Agreement does not specifically contemplate or expressly permit urban runoff discharges through the SJCO Outfall in lieu of secondary effluent discharge nor the use of the SJCO Outfall capacity for such purposes, and specifically does not permit the proposed CSC Runoff Discharge. SOCWA, in conjunction with CSC, has submitted an application for an amendment to the SJCO NPDES Permit to provide for the Runoff Discharge from the CSC Diversion Project ("Permit Amendment"), as set forth in that certain application for amendment to the SJCO NPDES Permit to Region 9, dated June 27, 2005. H. Under the original PC 5 Agreement, each PC 5 Member covenants that it will not deliver any discharge to the SJCO Outfall that will directly or indirectly, or in combination with any other material or substance delivered to the SJCO Outfall, prevent SOCWA from complying with the SJCO NPDES Permit, as amended from time to time. Further, the 1988 Amendment No. One requires certain PC 5 Member's individual discharges to meet the effluent limits set forth in the SJCO NPDES Permit, with possible liquidated damages for any violating discharges. I. Project Committee No. 5, at the request of CSC, desires to approve and execute this Amendment No. 4 in order to permit the Diversion Project to continue on the currently contemplated schedule, which has a 2007 project completion date, subject to the terms and conditions and limitations set forth in this Amendment No. 4 that recognize the use of CSC's capacity in the SJCO Outfall capacity for disposal of the Runoff Discharge. NOW, THEREFORE, the parties, in consideration of the mutual covenants and conditions set forth in this Amendment No. 4, agree as follows: AGREEMENT Section 1. Subject to possible limitations set forth in this Amendment No. 4 and in the PC 5 Agreement, the PC 5 Members acknowledge that member CSC may use its' capacity ownership in the SJCO Outfall for discharging the Runoff Discharge instead of secondary effluent, contingent upon compliance with all covenants and terms and conditions in this BAWG/I 12468v2 17108 N 10 8-29-06 0 0 Amendment No. 4, the PC 5 Agreement, the SJCO Outfall NPDES Permit, including the contemplated Amendment thereto for the Diversion Project, and any other applicable permits, rules, regulations, etc., as such documents and regulations may be amended in the future. These terms and conditions include, but are not limited to, discharge rate, dilution and constituents concentration concerns, or future TMDLs imposed relative to any discharge from the SJCO Outfall. The Runoff Discharge ultimately disposed through the SJCO Outfall will be required to be metered and monitored by CSC at appropriate locations as determined by the SOCWA General Manager or his designee to ensure there are no adverse impacts to the waste discharge requirements applicable to the SJCO Outfall or under the SJCO Outfall NPDES Permit, or any other applicable permits, laws, rules or regulations. Section 2. PC 5 Member CSC further convenants that it will not deliver to the SJCO Outfall any Runoff Discharge which directly or indirectly, or in combination with any other material or substance delivered to the SJCO Outfall by the other parties, will prevent SOCWA from complying with the waste discharge or other requirements established in the SJCO Outfall NPDES Permit or the provisions thereof, as amended from time to time. In the event that CSC's Runoff Discharge violates the covenants above, CSC shall pay any costs directly or indirectly resulting from such violation(s), including (i) all costs of ascertaining and establishing the violation; (ii) fines and penalties, including but not limited to mandatory minimum penalties imposed by the California Regional Water Quality Control Board - San Diego Region ( "Region 9"); (iii) all engineering, accounting, administrative, and legal costs; and, (iv) any increased operating, maintenance and replacement or repair costs. Section 3. To the extent the Runoff Discharge to the SJCO Outfall causes or results in operative impacts to the SJCO Outfall, resulting in added costs, CSC will appropriately compensate the PC 5 Members on a proportionate flow basis. The issue of operative impacts as described in this section will first be evaluated by SOCWA commencing on a date one (1) year after commencement of operation of the Diversion Project. Section 4. Notwithstanding any other term in this Amendment No. 4, nothing in this Amendment No. 4 is intended to be a waiver, modification or alteration of the capacity ownership of the PC 5 Members in the SJCO Outfall under,the PC 5 Agreement. Section 5. CSC agrees to fund, or reimburse, all SOCWA staff time, and any engineering, legal and other costs associated with Project Committee No. 5's consideration of the Diversion Project and Runoff Discharge matters discussed in this Amendment No. 4. These costs include the costs of preparation and review of this Amendment No. 4 and the Permit Amendment; provided, each individual Project Committee No. 5 Member Agency will fund its own separate BAWG/11246M 17108 N 10 8-29-06 0 costs, if any, relative to review and approval of such documents and related issues. CSC further agrees to fund any future Project Committee No. 5 costs associated with or required to review permit or regulatory terms or other matters relative to the proposed Diversion Projects or Runoff Discharge. Section 6. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Amendment No. 4. This Amendment No. 4 may be executed in one or more counterparts, each of which will be deemed an original. Section 7. Except as may be modified in this Amendment No. 4, all other terms and conditions of the PC 5 Agreement shall remain in full force and effect. In the event of any conflict or inconsistency between the PC 5 Agreement and this Amendment No. 4, the terms of this Amendment No. 4 shall control. above. Section 8. This Amendment No. 4 shall be effective as of the Effective Date defined THIS AMENDMENT NO.4 to the PC 5 Agreement is entered into by each of the parties as of the Effective Date defined above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 5. By Chairman By Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA By Patricia B. Giannone BAWG/112468v2 17108 N 10 18-29-06 CITY OF SAN CLEMENTE Mayor By City Clerk CITY OF SAN JUAN CAPISTRANO By Mayor By City Clerk MOULTON NIGUEL WATER DISTRICT By President By Secretary SANTA MARGARITA WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary SOUTH COAST WATER DISTRICT By President/Vice President By Secretary/Assistant Secretary • 6 BAWG/112468v2 17108 N 10 8-29-06 0 Cl 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493.1053 FAX www.sanjuancapistrano.org TRANSMITTAL TO Teri Noson SOCWA 34156 Del Obispo Street Dana Point, CA 92629 DATE: October 24, 2006 FROM: Maria Morris, Deputy City Clerk (949),443-6309 RE: Amendment No. 4 - Project Committee No. 5 Agreement MEMBERS OF THE CITY COUNCIL SAMALLEVATO DIANE BATHGATE WYATT HART JOE SOTO DAVID M. SWERDLIN Enclosed is a copy of the above referenced document and eight (8) original signature pages. Please after executing send our office a fully executed original for our records. If you have questions concerning the agreement, please contact Ziad Mazboudi, Senior Civil Engineer (949) 234-4413. Cc: Ziad Mazboudi, Senior Civil Engineer Nasser Abbaszadeh, Engineering and Building Director San Juan Capistrano: Preserving the Past to Enhance the Future � Pdin on 100% ROcycled Paper wd South Orange County Wastewater Authority Letter of Transmittal DATE: October 12, 2006 TO: Ziad Mazboudi ATTENTION: RE: Project Committee No. 5 Agreement — Amendment No. 4 We are ® enclosing ❑ returning under separate cover: Sent for your Status Please Note ❑ Review/Use ❑ Preliminary ❑ Revisions ❑ Approval ❑ Revised ❑ Additions ® Signature ❑ Approved ❑ Omissions ❑ File ❑ Released ❑ Corrections REMARKS: Enclosed is a copy of the above stated document and eight (8) original signature pages. Please execute the enclosed signature pages as appropriate, and return them to our offices in the provided self-addressed stamped envelope. Upon receiving the executed signature pages, we will send you a fully executed original for your records. Should you have any questions or if I can be of further assistance, please do not hesitate to contact me. Sincerely, Teri Noson, Executive Assistant SOCWA COPIES TO: file 34156 Del Obispo SLreeL • Dana Point, CA 92629 • Phone: (949) 234-5400 • Fax: (949) 489-0130 • Website: www.socwa. corn A publie agen, oeated by: CITY OF LAGUNA BEACH • CITY OF SAN CLEMENTE • CITY OF SAN JUAN CAPISTRANO • EL IORO WATER DISTRICT • EMERALD BAY SERVICE. DISTRICT IRVINE RANCH WATER DISTRICT • MOLT TON NIGUEL WATER DISTRICI • SANTA MARGARITA WATER DISTRICT • SOUTH COAST WATER DISTRICT •TRA6UCO CANTON WATER DISTRICT 32400 PASEO ADEI—ANTO SAN JUAN CAPISTRANO, CA 92875 (949) 493-1171 (949) 493-1053 FAX www sanjuancapistrano. org �!//�5yy'.� Ip[OAiOARiF! • [sraulsem � 1961 1776 e MEMBERS OF THE CITY COUNCIL NOTIFICATION OF MEETING OF POTENTIAL INTEREST OF THE SAN JUAN CAPISTRANO CITY COUNCIL SAM ALLEVATO DIANE BATHGATE WYATT HART JOE SOTO DAVID M. SWERDLIN The City Council of San Juan Capistrano will meet at 7:00 p.m. on October 17, 2006 in the City Council Chamber in City Hall, to consider: "Consideration of Approval of Amendment No. 4 to South Orange County Wastewater Authority's (SOCWA) Project Committee No. 5 (PC5) Agreement: Use of Outfall Capacity by City of San Clemente for Disposal of Treated Urban Runoff Discharge" — Item No. D8. If you have specific thoughts or concerns regarding this item, you are encouraged to participate in this decision making process. You can communicate with the City Council through correspondence addressed to the Council and/or by attending the meeting and speaking to the Council during the public meeting. Correspondence related to this item must be received at the City Clerk's office by 5:00 p.m. on Monday, October 16, 2006 to allow time for the Council to consider its content. If you would like to speak at the meeting, please complete a yellow "Request to Speak" form found inside the entrance to the Council Chamber. This form is turned in at the staff table, just in front of the Council dais. You will be called to speak by the Mayor when the item is considered. You have received this notice at the request of the City staff member Ziad Mazboudi, PE Senior Civil Engineer, Senior Civil Engineer. You may contact that staff member at (949) 949-234-4413 with any questions. The agenda, including agenda reports, is available to you on our web site: www.sanouancapistrano.org. If you would like to subscribe to receive a notice when agendas are posted to the web site, please make that request by sending an e-mail to: council-agendasasanivancapistrano.oro. Meg Monahan, CMC City Clerk cc: Tom Rosales, SOCWA General Manager*; Nasser Abbaszadeh, Director of Engineering and Building; Ziad Mazboudi, PE Senior Civil Engineer, Senior Civil Engineer * Received staff report San Juan Capistrano: Preserving the Past to Enhance the Future C* Prmtad.n 100% Recycled Paper AMENDMENT NO. 4 AGREEMENT FOR ACQUISITION OF CAPACITY, CONSTRUCTION, USE, OPERATION, AND MAINTENANCE OF OUTFALL FACILITIES FOR SOUTH EAST REGIONAL RECLAMATION AUTHORITY FOR AND ON BEHALF OF PROJECT COMMITTEE NO. 5 ("PC 5 AGREEMENT") This Amendment No. 4 to the PC 5 Agreement is effective as of the date of 2006 ( "Effective Date"), by and between South Orange County Wastewater Authority (SOCWA), a joint powers authority under Government Code Section 6500 et sem. and that certain joint powers agreement entitled "Joint Exercise of Powers Agreement Creating South Orange County Wastewater Authority Orange County, California (SOCWA) and Terminating Aliso Water Management Agency, South East Regional Reclamation Authority, South Orange County Reclamation Authority" dated July 1, 2001, ( "Joint Powers Agreement') and the following member agencies of SOCWA and its Project Committee No. 5: (a) City San Clemente (CSC); (b) City San Juan Capistrano (SJC); (c) Moulton Niguel Water District (MNWD); (d) Santa Margarita Water District (SMWD); and (e) South Coast Water District (SCWD). SOCWA is the successor -in -interest to the South East Regional Reclamation Authority under the PC 5 Agreement and for all other purposes. The foregoing entities are in some instances referred to individually as the "PC 5 Member" or collectively as the "PC 5 Members", which term is also defined to include all predecessors -in -interest to the individual PC 5 Members, as applicable, or individually as "party" and collectively or in combination as "parties". The parties are member agencies of SOCWA and Project Committee No. 5, and are signatories to the Joint Powers Agreement. RECITALS A. SOCWA is pursuing in the most beneficial economically and environmentally compatible manner, a regional program for wastewater collection, treatment, reclamation, reuse, disposal and management, including but not limited to that facility known as the SOCWA San Juan Creek Ocean Outfall ( "SJCO Outfall'). Project Committee No. 5 was previously created for the purpose of constructing and operating the SJCO Outfall, all in accordance with the PC 5 Agreement. B. SERRA and the PC 5 Members previously executed the PC 5 Agreement, dated August 18, 1977, as well as the November 10, 1977 Addendum, the March 10, 1988 Amendment No. One, the March 14, 1991 Amendment No. Two and the February 7, 2002 Amendment No. 3, thereto. The term "PC 5 Agreement" as used in this Amendment No. 4 shall include the 1977 Agreement referenced above and the 1977 Addendum, 1988 Amendment No. One, 1991 Amendment No. Two, 2002 Amendment No. 3 and this Amendment No. 4 upon approval and execution thereof. C The capacity ownership percentages of the PC 5 Members in the SJCO Outfall are set forth in the PC 5 Agreement, as follows: City of San Clemente (CSC) - 16.62% City of San Juan Capistrano (SJC) - 11.08% Moulton Niguel Water District (MNWD) - 15.51% Santa Margarita Water District (SMWD) - 44.32% South Coast Water District (SCWD) - 12.47% D. Pursuant to 2002 Amendment No. 3, the PC 5 Members agreed that, for all purposes, the design capacity of the SJCO Outfall is 80 mgd Peak Flow. This capacity of 80 mgd Peak Flow was based on the PC 5 Members' review and evaluation of the Wm. Lea Fisher report entitled "SERRA Outfall and Pump Station Capacity Evaluation and Cost Allocation Report," dated May 1, 1990, as supplemented by Fisher's report entitled "SERRA Outfall Pressure Rating," dated January 28, 1991. Based on the ownership percentages in Recital E above, the capacity interests of each PC 5 Member in the total 80 mgd Peak Flow SJCO Outfall capacity was agreed as follows: CSC 16.62% 13.30 mgd Peak Flow SJC 11.08% 8.86 mgd Peak Flow MNWD 15.51% 12.41 mgd Peak Flow SMWD 44.32% 35.46 mgd Peak Flow SCWD 12.47% 9.97 mgd Peak Flow E. The current SOCWA National Pollution Discharge Elimination System (NPDES) Permit (San Diego Regional Water Quality Control Board Order No. R9-2006-0054, NPDES No. CA0107417, expiration date October 1, 2011) for the SJCO Outfall ("SJCO NPDES Permit") permits a calendar -monthly average effluent daily flow rate limitation of 3 6.3 85 million gallons per day (mgd), as may be modified from time -to -time, which limitation applies to the PC 5 Members' use of permitted flows on an aggregate basis under such permit terms. F. PC 5 Member CSC has developed an urban water management plan to improve BAWG/112468v2 17108 N 10 8-29-06 0 0 water quality at CSC's beaches and the surf zone. CSC's Segunda Desheca (M02) Flood Control Channel ("Seganda Desheca Channel") is one of CSC's primary drainage facilities, and discharges flows onto North Beach and directly into the ocean. CSC is undertaking its "Segunda Desheca Channel Urban Runoff Diversion Project" ("Diversion Project") that will result in projected dry weather flows of approximately 1.5 cfs (1 mgd) of filtered urban runoff flows ("Runoff Discharge") through CSC's Land Outfall, with ultimate disposal to the SJCO Outfall. G. The PC 5 Agreement does not specifically contemplate or expressly permit urban runoff discharges through the SJCO Outfall in lieu of secondary effluent discharge nor the use of the SJCO Outfall capacity for such purposes, and specifically does not permit the proposed CSC Runoff Discharge. SOCWA, in conjunction with CSC, has submitted an application for an amendment to the SJCO NPDES Permit to provide for the Runoff Discharge from the CSC Diversion Project ("Permit Amendment"), as set forth in that certain application for amendment to the SJCO NPDES Permit to Region 9, dated June 27, 2005. H. Under the original PC 5 Agreement, each PC 5 Member covenants that it will not deliver any discharge to the SJCO Outfall that will directly or indirectly, or in combination with any other material or substance delivered to the SJCO Outfall, prevent SOCWA from complying with the SJCO NPDES Permit, as amended from time to time. Further, the 1988 Amendment No. One requires certain PC 5 Member's individual discharges to meet the effluent limits set forth in the SJCO NPDES Permit, with possible liquidated damages for any violating discharges. Project Committee No. 5, at the request of CSC, desires to approve and execute this Amendment No. 4 in order to permit the Diversion Project to continue on the currently contemplated schedule, which has a 2007 project completion date, subject to the terms and conditions and limitations set forth in this Amendment No. 4 that recognize the use of CSC's capacity in the SJCO Outfall capacity for disposal of the Runoff Discharge. NOW, THEREFORE, the parties, in consideration of the mutual covenants and conditions set forth in this Amendment No. 4, agree as follows: AGREEMENT Section 1. Subject to possible limitations set forth in this Amendment No. 4 and in the PC 5 Agreement, the PC 5 Members acknowledge that member CSC may use its' capacity ownership in the SJCO Outfall for discharging the Runoff Discharge instead of secondary effluent, contingent upon compliance with all covenants and terms and conditions in this BAWG/112468v2 17108 N 10 8-29-06 Amendment No. 4, the PC 5 Agreement, the SJCO Outfall NPDES Permit, including the contemplated Amendment thereto for the Diversion Project, and any other applicable permits, rules, regulations, etc., as such documents and regulations may be amended in the future. These terms and conditions include, but are not limited to, discharge rate, dilution and constituents concentration concerns, or future TMDLs imposed relative to any discharge from the SJCO Outfall. The Runoff Discharge ultimately disposed through the SJCO Outfall will be required to be metered and monitored by CSC at appropriate locations as determined by the SOCWA General Manager or his designee to ensure there are no adverse impacts to the waste discharge requirements applicable to the SJCO Outfall or under the SJCO Outfall NPDES Permit, or any other applicable permits, laws, rules or regulations. Section 2. PC 5 Member CSC further convenants that it will not deliver to the SJCO Outfall any Runoff Discharge which directly or indirectly, or in combination with any other material or substance delivered to the SJCO Outfall by the other parties, will prevent SOCWA from complying with the waste discharge or other requirements established in the SJCO Outfall NPDES Permit or the provisions thereof, as amended from time to time. In the event that CSC's Runoff Discharge violates the covenants above, CSC shall pay any costs directly or indirectly resulting from such violation(s), including (i) all costs of ascertaining and establishing the violation; (ii) fines and penalties, including but not limited to mandatory minimum penalties imposed by the California Regional Water Quality Control Board - San Diego Region ( "Region 9"); (iii) all engineering, accounting, administrative, and legal costs; and, (iv) any increased operating, maintenance and replacement or repair costs. Section 3. To the extent the Runoff Discharge to the SJCO Outfall causes or results in operative impacts to the SJCO Outfall, resulting in added costs, CSC will appropriately compensate the PC 5 Members on a proportionate flow basis. The issue of operative impacts as described in this section will first be evaluated by SOCWA commencing on a date one (1) year after commencement of operation of the Diversion Project. Section 4. Notwithstanding any other term in this Amendment No. 4, nothing in this Amendment No. 4 is intended to be a waiver, modification or alteration of the capacity ownership of the PC 5 Members in the SJCO Outfall under,the PC 5 Agreement. Section 5. CSC agrees to fund, or reimburse, all SOCWA staff time, and any engineering, legal and other costs associated with Project Committee No. 5's consideration of the Diversion Project and Runoff Discharge matters discussed in this Amendment No. 4. These costs include the costs of preparation and review of this Amendment No. 4 and the Permit Amendment; provided, each individual Project Committee No. 5 Member Agency will fund its own separate BAWG/112468v2 17108 N 10 8-29-06 C� 0 costs, if any, relative to review and approval of such documents and related issues. CSC further agrees to fund any future Project Committee No. 5 costs associated with or required to review permit or regulatory terms or other matters relative to the proposed Diversion Projects or Runoff Discharge. Section 6. The parties each represent and agree the Recitals are true and correct. The Recitals are incorporated into this Amendment No. 4. This Amendment No. 4 may be executed in one or more counterparts, each of which will be deemed an original. Section 7. Except as may be modified in this Amendment No. 4, all other terms and conditions of the PC 5 Agreement shall remain in full force and effect. In the event of any conflict or inconsistency between the PC 5 Agreement and this Amendment No. 4, the terms of this Amendment No. 4 shall control. Section 8. This Amendment No. 4 shall be effective as of the Effective Date defined above. THIS AMENDMENT NO.4 to the PC 5 Agreement is entered into by each of the parties as of the Effective Date defined above. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ON BEHALF OF PROJECT COMMITTEE NO. 5. By Chairman By Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel - SOCWA Patricia B. Giannone BAWG/112468v2 17108 N 10 18-29-06 CITY OF SAN CLEMENTE Mayor City Clerk CITY OF�AN CAPI N ) By Mayor °m1 City Clerk MOULTON NIGUEL WATER DISTRICT By President By Secretary SANTA MARGARITA WATER DISTRICT By President/Vice President Secretary/Assistant Secretary SOUTH COAST WATER DISTRICT By PresidentfVice President Secretary/Assistant Secretary 6 BAWG/112468v2 17108 N 10 8-29-06 32400 PASEO ADELANTO SAN JUAN CAPISTRANO, CA 92675 (949) 493-1171 (949) 493-1053 PAx www. sanjuancapistrano. org October 19, 2006 0 IA(OII ' Istnmsxlo I 196161 1776 • • NOTIFICATION OF ACTION BY THE CITY COUNCIL OF SAN JUAN CAPISTRANO MEMBERS OF THE CITY COUNCIL SAM ALLEVATO DIANE BATHGATE WYATT HART JOE SOTO DAVID M. SWERDLIN On October 17, 2006, the City Council of San Juan Capistrano met regarding: "Consideration of Approval of Amendment No. 4 to South Orange County Wastewater Authority's (SOCWA) Project Committee No. 5 (PC5) Agreement: Use of Outfall Capacity by City of San Clemente for Disposal of Treated Urban Runoff Discharge" Item No. D8. The following action was taken at the meeting: Amendment No. 4 approved to the SOCWA PC 5 agreement, to permit and recognize the use of the City of San Clemente's capacity in the San Juan Creek outfall for the disposal of treated dry weather flows by the City under the terms in Amendmetn No. 4 and as specified in the provisions of the NPDES permit; and the Mayor authorized to execute the agreement. The following documents are in the process of being executed: n/a If you have any questions regarding this action, please contact Ziad Mazboudi, PE Senior Civil Engineer, Senior Civil Engineer at 949-234-4413 for more detailed information. Thank you, Meg Monahan, CMC City Clerk Cc: Tom Rosales, SOCWA General Manager*; Nasser Abbaszadeh, Director of Engineering and Building; Ziad Mazboudi, PE Senior Civil Engineer, Senior Civil Engineer San Juan Capistrano: Preserving the Past to Enhance the Future C1 Printed on 100% Recycled Paper C� South Orange County Wastewater Authority Letter of Transmittal DATE: November 20, 2006 TO: Maria Morris, Deputy Clerk ATTENTION: RE: Project Committee No. 5 Agreement — Amendment No. 4 We are ® enclosing ❑ returning under separate cover: Sent for your Status Please Note ❑ Review/Use ❑ Preliminary ❑ Revisions ❑ Approval ❑ Revised ❑ Additions ❑ Signature ❑ Approved ❑ Omissions ® File ❑ Released ❑ Corrections REMARKS: Enclosed is a fully executed original of the above stated contract for your records. Please let me know if you have any questions or if I can be of further assistance. Thanks. Sincerely, Teri Noson, Executive Assistant SOCWA COPIES TO: file 34156 Del Obispo Street • Dana Point, CA 92629 • Phone: (949) 234-5400 • Fax: (949) 489-0130 • WehSILe: WWW.SOCWa-Corn A public agency creased by: CITY OF L ,GUNA BEACH • CITY OF SAN CLEMENTE • CITY OF SAN JUAN CAPISTRANO • EL TORO WATER DISTRICT • EMERALD BAY SERVICE, DISTRICT IRVINE RANCH WATER DISTRICT • MOULTON NIGCEL WATER DISTRICT • SANTA MARGARITA WATER DISTRICT • SOUTH COAST WATER DISTRICT •TRABUCO CANYON WATER DISTRICT RESOLUTION NO. 2002 —02 RESOLUTION OF THE BOARD OF DIRECTORS OF SOUTH ORANGE COUNTY WASTEWATER AUTHORITY (PROJECT COMMITTEE NO. 5/ SAN JUAN CREEK OCEAN OUTFALL) SETTING FORTH TERMS AND CONDITIONS FOR APPROVAL OF BRINE DISCHARGE TO PC 5 OUTFALL A. WHEREAS, SOCWA Project Committee No. 5 (PC 5) Member City of San Juan Capistrano (SJC) is undertaking a desalter project that will result in an associated brine discharge. SJC has proposed to discharge the brine through the Santa Margarita Water District's (SMWD) Chiquita Land Outfall, which ultimately discharges to SOCWA's PC 5 San Juan Creek Ocean Outfall ("PC 5 Outfall"); B. WHEREAS, PC 5 Member South Coast Water District (SCWD) is considering construction of a similar desalter project, and proposes to discharge the brine to the Chiquita Land Outfall or directly to the PC 5 Outfall; C. WHEREAS, both SJC and SCWD own capacity in the PC 5 Outfall pursuant to the "Agreement for Acquisition of Capacity, Construction, Use, Operation, and Maintenance of Outfall Facilities for South East Regional Reclamation Authority for and on Behalf of Project Committee No. 5", and related amendments thereto (collectively, the "PC 5 Agreement") along with the other PC 5 Members. The capacity ownership percentages of the PC 5 Members are set forth in the PC 5 Agreement as follows: City of San Clemente (CSC) - 16.62% City of San Juan Capistrano (SJC) - 11.08% Moulton Niguel Water District (MNWD) - 15.51% Santa Margarita Water District (SMWD) - 44.32% South Coast Water District (SCWD) - 12.47%; D. WHEREAS, the current SOCWA NPDES Permit (San Diego Regional Water Quality Control Board Order 2000-13) for the PC 5 Outfall permits average dry weather flows (ADWF) of not -to -exceed 30 million gallons per day (mgd), which total mgd ADWF limitation, as may be modified from time -to -time, applies to the PC 5 Members' use of permitted flows on an aggregate basis under the permit terms; E. WHEREAS, the PC 5 Agreement does expressly permit brine discharges (or nuisance secondary effluent discharge, nor the use of the purposes; BAW&G/PG/kp/77593 17108 N 5.1 1-22-02 FINAL not specifically contemplate or water discharges) in lieu of PC 5 Outfall capacity for such 0 0 F. WHEREAS, under the original PC 5 Agreement, each PC 5 Member covenants that it will not deliver any discharge to the PC 5 Outfall that will directly or indirectly, or in combination with any other material or substance delivered to the PC 5 Outfall prevent SOCWA from complying with the PC 5 Outfall NPDES Permit as amended from time to time. Further, in 1988 PC 5 approved Amendment No.1 to the original PC 5 Agreement that required certain PC 5 Members' individual discharges to meet the effluent limits set forth in the PC 5 Outfall NPDES Permit, with possible liquidated damages for any violating discharges; G. WHEREAS, the PC 5 Outfall NPDES Permit recognizes the brine discharges of SJC and SCWD discussed above, and establishes certain effluent limitations under brine discharge conditions; H. WHEREAS, SJC and SCWD have requested PC 5 to consider adoption of this Resolution in order to permit such members' respective desalter projects to continue on the currently contemplated schedules, which have 2003 project completion dates, subject to the terms and conditions set forth herein that recognize the use of PC 5 Outfall capacity for brine discharge with certain limitations thereon, all such terms and conditions to be set forth in a formal amendment to the PC 5 Agreement as soon as reasonably possible; and I. WHEREAS, in order to accommodate SJC's and SCWD's project schedule, PC 5 desires to memorialize general terms and conditions (1) recognizing the use of the PC 5 Outfall capacity for brine discharge purposes, and (2) governing such discharges; all to be further set forth in a formal amendment to the PC 5 Agreement. NOW, THEREFORE, the Board of Directors of South Orange County Wastewater Authority (Project Committee No. 5) DOES HEREBY RESOLVE, DETERMINE, and ORDER as follows: Section 1. Subject to possible limitations set forth below, the PC 5 Members acknowledge that certain PC 5 Members may use their respective capacity ownership in the PC 5 Outfall for discharging brine, instead of secondary effluent, contingent upon compliance with all covenants and terms and conditions in the PC 5 Agreement, the PC 5 Outfall NPDES Permit and any other applicable permits, rules, regulations, etc., as such documents and regulations may be amended in the future. These terms and conditions include, but are not limited to, discharge rate, dilution and constituent concentration concerns, or future TMDLs imposed relative to any discharge from the PC 5 Outfall. The brine discharges ultimately disposed through the PC 5 Outfall will be required to be metered and monitored by SJC and SCWD at appropriate locations to ensure there are no adverse impacts to the waste discharge requirements applicable to the PC 5 Outfall or under the PC 5 Outfall NPDES Permit, or any other applicable permits, rules or regulations. BAW&G/PG/kp/77593 17108 N 5.1 1-22-02 FINAL 0 9 Section 2. In order for the PC 5 Members to adequately address any PC 5 Outfall capacity issues that could be affected by the use of the PC 5 Outfall for brine discharge, the PC 5 Members agree that, for all purposes, the design capacity of the PC 5 Outfall is 80 mgd Peak Flow. This capacity of 80 mgd Peak Flow is based on the PC 5 Members' review and evaluation of the Wm. Lea Fisher report entitled "SERRA Outfall and Pump Station Capacity Evaluation and Cost Allocation Report", dated May 1, 1990, as supplemented by his report entitled "SERRA Outfall Pressure Rating", dated January 28, 1991. Based on the ownership percentages in Recital C above, the capacity interests of each PC 5 Member in the total 80 mgd Peak Flow PC 5 Outfall capacity is set forth as follows: CSC 16.62% 13.30 mgd Peak Flow SJC 11.08% 8.86 mgd Peak Flow MNWD 15.51% 12.41 mgd Peak Flow SMWD 44.32% 35.46 mgd Peak Flow SCWD 12.47% 9.97 mgd Peak Flow Section 3. To the extent brine discharges to the PC 5 Outfall cause or result in operative impacts to the effluent pump station located at SOCWA's Jay B. Latham Plant, resulting in added pumping costs, the PC 5 Members discharging brine will appropriately compensate the SOCWA member agencies owning capacity in the pump station on a proportionate basis. The issue of operative impacts as described herein will first be evaluated by SOCWA commencing on a date one (1) year after commencement of operation of the earlier of the SJC or SCWD desalter projects. Section 4. Upon the earlier of (1) the date of any PC 5 Outfall NPDES Permit term expiration ( or such time in advance of that expiration date reasonably necessary to process renewal by such expiration date) or, (2) a point in time when the ADWF flows through the PC 5 Outfall equal 80% of the permitted capacity ("permit renewal"), PC 5 will initiate permit renewal. The costs for permit renewal shall be allocated to and paid by the PC 5 Members in proportion to their actual mgd ADWF flows through the PC 5 Outfall at that applicable time, which is consistent with SOCWA's current practice. Section 5. For any period of time in which the permitted flow limit is not less than 30 mgd ADWF (i.e. current NPDES permit limit), all PC 5 Members' flows through the PC 5 Outfall will be on an aggregate basis, and the permitted capacity may be used by the PC 5 Members accordingly. Notwithstanding any term in this Resolution, nothing herein is intended to be a waiver, modification or alteration of the capacity ownership of the PC 5 Members in the PC 5 Outfall under the PC 5 Agreement. BA W &G/PG/kp/77593 17108 N 5.1 1-22-02 FINAL 0 0 Section 6. The PC 5 Members intend to enter into an amendment to the PC 5 Agreement on an expeditious basis to contractually memorialize the policies and terms and conditions adopted and described in this Resolution. The PC 5 Members acknowledge that the adoption of this Resolution is not contractually binding, and no PC 5 Member should rely on the statements of present policy and intent contained herein in the absence of the approval and execution of the contemplated PC 5 Agreement amendment SJC and SCWD will be required to fund the costs of this Resolution and such amendment, as well as any associated costs required to review permit or regulatory terms or other matters relative to the proposed brine discharges. ADOPTED, SIGNED, and APPROVED this 7th day of February, 2002. SOUTH ORANGE COUNTY WASTEWATER AUTHORITY (Project Committee No. 5) Ch 'man a Secretary APPROVED AS TO FORM: BOWIE, ARNESON, WILES & GIANNONE Legal Counsel -South Orange County Wastewater Authority By id'%�' ,I z" Patricia B.Giannone BAW&G/PG/kp/77593 17108 N 5.1 1-22-02 FINAL STATE OF CALIFORNIA ) ) ss. COUNTY OF ORANGE ) I, DAVID A. CARETTO, Secretary of the Board of Directors of the SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ("SOCWA"), do hereby certify that the foregoing Resolution No. 2002-02 was duly adopted by the SOCWA Board of Directors at their Board Meeting held on the 7th day of February 2002 and that it was so adopted by the following vote: Diane Bathgate, CSJC; Larry Lizotte, MNWD; Bob Moore, AYES: SCWD; Dan Ferons, SMWD NOES: Bill Cameron, CSC ABSENT: ABSTAIN: Dated: February 7, 2002 David A. Caretto, Secretary SOUTH ORANGE COUNTY WASTEWATER AUTHORITY 0 0 STATE OF CALIFORNIA ) ) ss. COUNTY OF ORANGE ) 1, DAVID A. CARETTO, Secretary of the Board of Directors of the SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ("SOCWA"), do hereby certify that the foregoing is a full, true and correct copy of Resolution No. 2002-02 of said Board and that the same has not been amended or repealed. Dated this 7th day of February 2002. Glc David A. Caretto, Secretary SOUTH ORANGE COUNTY WASTEWATER AUTHORITY ,b)* c�� Pawn Sch� hde• //cs a ,rwA Rohe„bP.yr//1Dt,.� South Orange County Wastewater Authority Letter of Transmittal DATE: August 5, 2002 TO: CITY OF SAN JUAN CAPISTRANO 32400 Paseo Adelanto San Juan Capistrano, CA 92675 ATTENTION: Eric Bauman FROM: Roseanne Lindquist RE: SOCWA RESOLUTION NO. 2002-02 (PC 5) SETTING FORTH TERMS AND CONDITIONS FOR APPROVAL OF BRINE DISCHARGE TO PC 5 OUTFALL We are x enclosing returning under separate cover Serit for your: Status: Please Note: x Review/Use _ Preliminary _ Revisions Approval _ Revised Additions Signature _ Approved/Executed Omissions File Released Corrections 34156 Del Obispo Street • Dana Point, CA 92629 • Phone: (949) 234-5400 • Fax: (949) 489-0130 • Website: www.soewa.com A public agency created by: CITY OF LAGUNA BEACH • CITY OF SAN CLEMENTE • CITY OF SAN JUAN CAP15TRANO • EL TORO WATER DISTRICT • EMERALD BAY SERVICE DISTRICT IRVINE RANCH WATER DISTRICT • MOULTON NIGUEL WATER DISTRICT • SANTA MARGARITA WATER DISTRICT • SOUTH COAST WATER DISTRICT • TRABUCO CANYON WATER DISTRICT 0 January 13, 2004 Mr. David F. Adams City Manager CITY OF SAN JUAN CAPISTRANO 32400 Paseo Adelanto San Juan Capistrano, CA 92675 RE: EXPANDED GREASE INTERCEPTOR SERVICES BY ECIS Dear Mr. Adams This letter agreement will memorialize City of San Juan Capistrano's ("SCJ") agreement to have SOCWA execute the "Notice of Additional Grease Services for SJC" attached hereto as Exhibit "A" ("Notice") under and pursuant to the terms of "Addendum 2" dated August 28, 2002, to the "Pretreatment/Grease Trap Inspection Services Agreement between Aliso Water Management Agency/South East Regional Reclamation Authority and Environmental Compliance Inspection Services", dated February 1, 2001, as previously supplemented and modified by "Addendum 1", dated June 20, 2001 (collectively the "ECIS" Agreement") for the benefit of SJC, pursuant to SJC's existing "Interagency Agreement" between SOCWA and SJC facilitating SOCWA's operation of SJC's pretreatment program. Pursuant to the Interagency Agreement and Addendum 2 referenced above, SJC agrees that SOCWA will notify Environmental Compliance Inspection Services (ECIS) on behalf of SJC to initiate additional services under Sections 1.A. and 1.8. of the ECIS Agreement for SJC's benefit and account ("SJC Additional Services"), which will be in addition to the Database services under Section 1.C. thereof currently provided to SJC, and that SJC has reviewed the terms of the ECIS Agreement, concurs with all terms thereof, including the SJC Additional Services authorization under the Notice attached hereto. Further, SJC agrees to pay for all services rendered on its behalf by ECIS, including the SJC Additional Services, on a timely basis and in accordance with the terms and conditions of the ECIS Agreement. Very truly yours, SOUTH ORA(N///G++E COUNTY WASTEWATER AUTHORITY DaviC' tto General Manager ACKNOWLEDGED AND AGREED: CITY OF SAN JUAN CAPISTRANO Date: Ute-/ By: C David Adams, City Manager 34156 Del Obispo Street • Dana Point, CA 92629 • Phone: (949) 234-5400 • Fax: (949) 489-0130 • Website: www.socwa.com A public agency created by: CITY OF LAGUNA BEACH • CITY OF SAN CLEMENIE • CITY OF SAN JUAN CAPISTRANO • EL TORO WATER DISTRICT • EMERALD BAY SERVICE DISTRICT IRVINE RANCH WATER DISTRICT • MOULION NIGUEL WATER DISTRICT • SANTA MARGARITA WATER DISTRICT • SOUTH COAST WATER DISTRICT • IRABUCO CANYON WATER DISTRICT SQCWA South Orange County Wastewater Authority Letter of Transmittal DATE: November 30, 2001 D=EO lS fU TO: CITY OF SAN JUAN CAPISTRANO 32400 Paseo Adelanto San Juan Capistrano, CA 92675 CIY OF SAN JUAN CAPISTRANO ENGINEERING DEPARTMENT ATTENTION: Ms. Jill Thomas FROM: Roseanne Lindquist RE: JOINT EXERCISE OF POWERS AGREEMENT CREATING SOUTH ORANGE COUNTY WASTEWATER AUTHORITY (SOCWA) We are x enclosing returning under separate cover Sent for your: Status: Please Note: _ Review/Use _ Preliminary _ Revisions Approval _ Revised _ Additions Signature _ Approved/Executed _ Omissions x Files Released Corrections Jill — Here you go. If you have any questions, please don't hesitate to give me a call. As discussed, we don't have another original signature copy so hopefully this will suffice. Have a great weekend. r` 1 P 34156 Del Obispo Street • Dana Point, CA 92629 • Phone: (949) 234-5400 • Fax: (949) 489-0130 • Websue: www.socwa.com A public agency created by: CITY OF LAGUNA BEACH • CITY OF SAN CLEMENTE • CITY OF SAN JUAN CAPISTRANO • EL TORO WATER DISTRICT • EMERALD BAY SERVICE DISTRICT IRVINE &INCH WATER DISTRICT • MOULTON NIGUEL WATER DISTRICT • SANIA MARGARITA WATER DISTRICT • SOUTH COAST WATER DISTRICT • TRABUCO CANYON WATER DISTRICT 5. R1 7. 0 0 INC.) (600.30) As set forth in the Report dated March 20, 2001 from the Public Works Director, the Personal Services Agreement with GMF Sound, Inc. to design and install a sound system in the Counci{ Chamber for an amount not to exceed $20,000 was approved. 670.50 As set forth in the Report dated March 20, 2001 from the Public Works Director, the following resolution offering water facilities easement to the Capistrano Valley Water District through the City's open space was approved: RESOLUTION 01-3-20-1. OFFER TO DEDICATE PUBLIC WATER FACILITIES EASEMENT TO CVWD THROUGH CITY OPEN SPACE - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA OFFERING TO DEDICATE A PUBLIC WATER FACILITIES EASEMENT TO CAPISTRANO VALLEY WATER DISTRICT THROUGH CITY OPEN SPACE LOCATED WESTERLY OF TRACT 13726. As set forth in the Report dated March 20, 2001 from the Chief of Police Services, participation in the Orange County Sheriff's MDC program for police services cars, and commitment of funds in the amount of $112,235 received from the State of California from the Safer Communities Technology Grants Program was approved. APPROVE AGREEMENT FOR CONSOLIDATION OF SOUTHEAST REGIONAL As set forth in the Report dated March 20, 2001 from the Engineering and Building Director, the agreement to consolidate SERRA, AWMA, and SOCRA was approved. 9. DENIAL OF CLAIMS (MASEK. DANSON, DEHAAS, HANTEN, KARJOO, WELIN, KUO, LEE, MIKOLAJCZAK. PRINCE, ROSEN TROWBRIDGE YAMAGUCHI 170.30 As set forth in the Report dated March 20, 2001 from the City Attorney, the claims for Marion Masek, Richard & Elaine Danson, David and Maria DeHaas, Stephen and Laurie Hanten, Rahim Karjoo, Lisa Welin, Kuan Chu & Fang -Lan Wang Kuo, James CC Minutes -3- 03/20/01 t+ AGENDA ITEM March 20, 2001 TO: George Scarborough, City Manager FROM: William M. Huber, Director of Engineering & Building SUBJECT: Consideration of Agreement for Consolidation of Southeast Regional Reclamation Authority (SERRA), Aliso Water Management Agency (AWMA) and South Orange County Reclamation Authority (SOCRA) It is recommended that the City Council approve the agreement for the consolidation of SERRA, AWMA, and SOCRA, forming a new agency called South Orange County Wastewater Authority (SOCWA). SITUATION A. Summary and Recommendation At City Council's May 31, 2000 meeting, Resolution No. 00-5-31-4 was adopted, supporting the consolidation of SERRA, AWMA, and SOCRA. Since then, the combined agencies have been working on the agreement to consolidate. Attachment #1 is the consolidation agreement, which forms a new entity called South Orange County Wastewater Authority (SOCWA). The agreement represents only a consolidation of the agencies with all previous rights and entitlements being preserved. The consolidation will result in only minor cost savings to the member agencies, as all three agencies are currently served by the same administrative staff, and each agency operates independent treatment plant facilities. There would be some benefits derived from the consolidation in the centralization of purchasing, shared wage and benefit administration, single budget preparation, etc.. Staff supports the consolidation and, therefore, recommends approval. FOR CITY COUNCIL AGEK..N Agenda Item Page 2 March 20, 2001 B. Background The three agencies, SERRA, AWMA and SOCRA consist of the following member agencies: SERRA AWMA sOCRA City of San Juan Capistrano City of Laguna Beach Moulton Niguel Water District Santa Margarita Water District Emerald Bay Service District Santa Margarita Water District City of San Clemente EI Toro Water District El Toro Water District Moulton Niguel Water District Los Alisos Water District Los Alisos Water District South Coast Water District South Coast Water District Irvine Ranch Water District Moulton Niguel Water District Trabuco Canyon Water District Discussion of consolidation of the three regional wastewater treatment and reclamation agencies in South Orange County began several years ago. Most recently, RM & Associates completed the first phase of a proposed three -phased study in 1994. This report concluded that AWMA, SERRA, and SOCRA should consolidate in the interest of greater efficiency. In March of 1996, the AWMA and SERRA Agencies commissioned an administrative and management review of the agencies. This study was performed by Griffith & Associates. The study made a variety of recommendations regarding staffing and plant operations, including the Board and Agency organization. Griffith recommended the consolidation of AWMA and SERRA into a single new Joint Powers Authority (JPA), with that agency providing staff support to two other JPA's; SOCRA and San Juan Basin Authority (SJBA). Since the completion of the Griffith Study, the SJBA has terminated its relationship with AWMA/SERRA, and consolidation with that agency does not appear likely at this time. Following the issuance of the Griffith Study, staff was requested to review the report and make its own recommendations regarding the agency organization, staffing, plant operations, etc.. Many of these recommendations were eventually implemented or implemented with modifications. In May, November, and December of 1997, the Joint AWMA/SERRA Board again discussed the issue of consolidation, along with the frequency of Board meetings, committee organization, and other issues. The staff was requested at that time to present information on the costs and benefits of consolidation and the legal steps involved in consolidation. These issues are discussed in the next section. As a result of the Board review in late 1997, the issue of consolidation of the JPA's was put on hold while Local Agency Formation Commission (LAFCO) reorganization actions were being considered among many coastal agencies (City of Laguna Beach, South Coast Water District, and City of Dana Point). Nevertheless, the Boards did approve other staff recommendations at the time, including less frequent Joint Board meetings (AWMA/SERRA now meets regularly every other month) and f Agenda Item Page 3 March 20, 2001 a consolidated Finance Committee. The Boards also requested that staff continue to look at ways to integrate the two JPA's to share resources, and to act in all ways as if the organization had been legally consolidated. In December of 1999, pursuant to direction from the AWMA/SERRA Boards, the General Manager presented an Evaluation of the Future Policy Direction for the AWMA/SERRA Organization. This report was reviewed by the AWMA/SERRA Boards at their February 2000 meeting. Among the recommendations contained in that report was one that the AWMA and SERRA Joint Powers Authorities should be consolidated into a single agency serving the regional wastewater treatment and disposal needs of South Orange County. It was also suggested that if SOCRA could be properly integrated into the organization, then it too should be included in the consolidation. Ultimately, as a result of the meeting, the General Manager and Legal Counsel were directed to bring back a report regarding consolidation of the JPA's as an action item for the Boards at their April 2000 meeting. BENEFITS/ADVANTAGES Staff has attempted to summarize below the benefits or advantages of consolidation. It should be pointed out, however, that many of the perceived or real advantages of consolidation of the three agencies have already occurred because of the joint management and operation of the agencies which has existed for several years. These advantages include, among others: 1. A single administrative staff 2. Interagency plant transfers and cross -training 3. A single administrative location 4. Centralized purchasing and contract administration 5. Shared wage and benefit administration 6. Centralized information management 7. Shared engineering support 8. Shared accounting, budget, and payroll administration 9. Shared specialized maintenance, operations, and laboratory support. Should the agencies opt to consolidate into a single Joint Powers Authority, the additional benefits or advantages which the consolidated agency envision are as follows: A single agency responsible for regional wastewater treatment and disposal in South Orange County would be less confusing to the general public and other public agencies. A single, larger agency with 11 members, four treatment plants, and two outfalls should also have a larger collective voice in legislative and regulatory affairs. Agenda Item Page 4 March 20, 2001 2. A single consolidated JPA among AWMA, SERRA, and SOCRA would result in fewer meetings, which would result in less time and cost involved in agenda and minute preparation and distribution. Also, fees would be paid less frequently to Board Members, and less staff time would be devoted to these meetings, allowing staff to concentrate on other important issues. 3. The consolidation would result in preparation of a single budget, single audit, single use audit, etc., where currently each of those items is prepared separately for each agency. In addition, the consolidation would result in the creation of a single set of consistent policies, procedures, etc., which are now currently produced for each agency. 4. The consolidation would result in a reduction of duplicate ordering, duplicate payments, and cross payments between the agencies, some of which cannot currently be avoided. While this is not a significant cost item at present, a consolidation would eliminate this entirely. Note, that as currently constituted, each JPA is a separate legal entity and must be treated as such. A consolidation of the sort contemplated would foster a further regional approach to wastewater treatment, disposal and reclamation in South Orange County and would be consistent with the current efforts in South County to consolidate and regionalize agencies as endorsed by LAFCO. 6. A single new agency, separate from either AWMA, SERRA, or SOCRA, would help to foster more cohesiveness and less parochialism among their employees (and perhaps also among Member Agencies), some of whom still view themselves only as AWMA or SERRA employees and not part of a larger group or agency. DISADVANTAGES TO THE CURRENT ARRANGEMENT At previous meetings, the AWMA/SERRA Board of Directors has asked SERRA/AWMA if there would be any significant downside or disadvantages to keeping the three agencies in existence and operating much as they have during the last couple of years. The current arrangement is certainly not unwieldy or terribly cumbersome. Board meetings have run fairly smoothly and quickly, despite the large size of the Joint Boards. SERRA/AWMA staff have attempted to keep the agendas focused to matters which are appropriate to the Board meeting, rather than to a specific Project Committee. Staff would easily adapt if the Boards or Member Agencies determined not to proceed any further with consolidation. The greatest disadvantage to continuing to operate as SERRA/AWMA is that with three agencies, they are essentially running everything in parallel. SERRA/AWMA keeps separate books, budgets, audits, use audits, payroll, records, minutes, policies, for three separate agencies. This could be accomplished more simply with a single agency. Though it probably does not require a significant amount of additional effort to keep Agenda Item Page 5 March 20, 2001 separate and distinct records, it does not appear to be the most efficient way in which to operate, particularly when the three agencies are so similar and much integration has already taken place. If the agencies did not consolidate, it would have no adverse impact on the operations, personnel staffing, NPDES permits or other regulatory requirements. SERRA/AWMA would continue to operate much as it has in the past with three separate agencies and a consolidated administration. COSTS/SAVINGS As part of the earlier discussions with the AWMA/SERRA Board of Directors, it was requested that staff assemble information regarding the potential cost to complete a consolidation of the three agencies. (If that was the direction selection by the Boards and the Member Agencies.) Listed below are SERRA/AW MA estimates of these costs/savings at the present time. Please note that several of these estimates are speculative, as some of the cost information will be available only at the time of actual consolidation. Legal Costs $12,000 - $20,000 Personnel Benefits Workers Compensation Liability Insurance Property Insurance Miscellaneous $7,700 Per Year $9,600 -$16,800 Per Year $3,500 Per Year $3,200 Staff has not attempted to summarize AWMA/SERRA staff costs to complete the consolidation, as these are already accounted for in the AWMA/SERRA/SOCRA Agency Management Budget. It is estimated, however, that between the General Manager, Controller, Human Resources and clerical staff, at least 150-200 hours of time would be charged to this specific project. Some reduction in staff time (on agenda preparation, finance committee packets, minutes, various accounting functions, etc.) could be anticipated with a combined agency. This reduction of duplicate or triple effort will allow the staff to better assimilate the additional tasks already assumed by the recent increase in the number of plants operated and the personnel and accounting tasks associated with them. Item Page 6 March 20, 2001 VOTIN SERRA, AWMA and SOCRA are set up by various project committees for items such as plant operations, outfall, administration, pre-treatment programs, with only those members that have a stake in the project committee allowed to vote. Consolidation would not affect the voting make-up for the project committees. It, however, would change the make-up when it comes to the administrative and general fund budgets and any personnel bargaining issues, as each agency would be one voice in 11. AGREEMENT The proposed agreement incorporates all past agreements into a single document. The Attorney for the Agency prepared the document and has provided a summary review shown in Attachment #2. The agreement preserves all the previous rights as to capacities, administration, budget allocations provided in the existing agreements. In addition, City staff and the City Attorney have reviewed the document and concur with recommending approval. CONCLUSION There are benefits of consolidation, resulting primarily from an elimination of duplication of effort for such items as budget, audit, use audit, purchase ordering, payments, cross payments between agencies, payroll, records, minutes, contracts, etc., would outweigh the relatively minor costs anticipated to complete the consolidation. As a practical matter, there is no really good reason at this point to maintain three separate JPA organizations since the activities and responsibilities of each are now very similar and all three organizations are jointly administered. It is for these reasons that staff believes the agencies should proceed with consolidation of AWMA, SERRA, and SOCRA. COMMISSION/BOARD REVIEW AND RECOMMENDATIONS Not Available FINANCIAL CONSIDERATIONS There will be only minor cost savings to the Sewer Enterprise Fund as discussed in the body of the report. PUBLIC NOTIFICATION David Carretto, SERRA Agenda Item Page 7 March 20, 2001 ALTERNATE ACTIONS 1. Approve as Recommended. 2. Do Not Approve. 3. Return to Staff for additional information. RECOMMENDATION It is recommended that the City Council approve the agreement for the consolidation of SERRA, AWMA and SOCRA , forming a new agency called South Orange County Wastewater Authority (SOCWA). Respectfully submitted, 4� --4,6/w� William M. Huber Director of Engineering & Building WMH:jt Attachments: 1. Agreement 2. Agency Attorney Summary/Review ATTACHMENT #2 • ALE%ANDRR BOlW1E* JOAN C. ARNIISON WRNDY H. RILES* PATRICIA R. GIANNONE ROBRRT E. ANSLOR DANIEL]. PAYNE BRIAN W. SWTH JULIA D. PUCE LRONIE MULVIIOLL TIPPANYJ. ISRAEL MIRANDADESMSEY HAM C. POWER •A 1WO145SIONAL CORPOMrM BOWIE, ARNESON, WILES & GIANNONE A PARTNERSHIP INCLUDING PROPEMONAL CORPORATIONS NrrOSNRYS AT LAR 4920 CAMPUS DRIVE NR9P70RT "&M. C.1 •FOM" 954e0 (919) numo SIDS TRNTN VMRBT, SUITS 715 RIVEWDR, CAIJPORNIA 91902 (909) 335.2750 27m1 TOURNEY ROAD, SUITE 200E VALENCIA, CALIFORNIA HISS (SSti'1M-2505 MEMORANDUM To: Dave Caretto FILE No: FROM: Pat Giannone DATE: November 30, 2000 (no) ""M PAX (949) ISI -2014 0wo1V1lO naPloOr ORntx m.uuR nL9 1056 P I RE: Draft Joint Powers Agreement for Consolidated JPA, Successor to AWMA, SERRA,SOCRA As previously directed by the Boards, the new JPA Agreement is modeled closely on the AWMA/SERRA/SOCRA agreements. There is, of course, some variance among those three agreements, but nothing substantively significant. The following is a brief overview ofthe draft JPA terms, noting the basic concepts and how certain terms ofthe AWMA/SERRA/SOCRA agreements were reconciled. 1. The consolidation of AWMA/SERRA/SOCRA is accomplished by recission and termination of the existing joint powers agreements and agencies contemporaneously with the creation of the new JPA, which assumes all existing policies, rules and regulations, contracts and assets of the three prior agencies. The draft JPA is based on the AWMA, SERRA and SOCRA joint powers agreements and follows those terms and organization very closely. The draft JPA accomplishes three basic things: fit, it formally rescinds the A WMA/SERRA/SOCRA joint powers agreements and terminates those existing agencies on the effective date of July 1, 2001; second, it simultaneously on July 1, 2001, creates the new JPA as a successor -in -interest to AWMA/SERRA/SOCRA, providing for the assumption of the prior agencies' rights and obligations; third, it sets forth in detail the powers, purposes and organization of the new TPA, which is generally based on combining those of AWMA/SERRA/SOCRA. BOWIE, ARNESON, WILES & GIANNONE Dave Caretto November 29, 2000 Page 2 2, Recitals The recitals describe the consolidation process. The powers and purposes of the new JPA are based almost word-for-word on the language used in the AWMA/SERRA/SOCRA joint powers agreements. UNEW ..t 0 „ . These are based on the three prior agreements' definitions. The term "Bonds" and "Bond Law" were added to provide maximum financing flexibility by recognizing vehicles not previously existing in the joint powers statutes - (i.e_) Marks -Roos bonds. The AWMA/SERRAJSOCRA jointpowers agreements require the recission ofthose agreements and termination of the agencies by all the members. The recission and termination is effective on July 1, 2001, concurrently with the formation of the new JPA. Section III - Purposes and Powers of New JPA Beginning with Section III, and following, the Agreement is modeled very closely onthe existing AWMA/SERRAJSOCRA jointpowers agreements, inmany sections virtually word- for-word. In some cases, there were differences between the AWMA, SERRA and SOCRA agreements, and we usedthe terms that seemed the most suitable, The objective was to use the terms common to AWMA and SERRA as much as possible; however, since SOCRA was formed 15 - 20 years after AWMAISERRA, the SOCRA terms were used in some instances to update outdated terminology or concepts. Section 3.4 As in the AWMA/SOCRA agreements, the powers are exercised in accordance with the restrictions imposed on a California water district (MM, ET'WD, MNWD and SMWD). Sections 3 5 - 3.7 These are the 'transition' terms that designate the new JPA as successor -in -interest to AWMA/SERRA/SOCRAs' rights, assets and obligations. There are some minor differences inpolicies among AWMA/SERRA/SOCRAthatmay havoto be reconoiledbefore or after July 1, 2001. Fortunately, many of the policies are identical, and the regulatory permits and ordinances cover different facilities, so all will remain in place. The AWMA/SERRA employees 6AW(MMMI70727 BOWIE, ARNESON, WILES & GIANNONE Dave Caretto November 29, 2000 Page 3 become employees of the new JPA. The SERRA PERS plan will be the controlling plan, subject to the AWMA employees inclusion. Staff is reviewing how this personnel transition will work with PERS staff so there arc no negative effects. This section may need to be revised depending on that guidance. Section 4.11 As is the current mdLce in AWMA/SERRA, the General Manager is designated the Treasurer/Auditor, which can be changed by a resolution of the directors. ,Section 6.5 Even though the current AWMA/SERRA joint powers agreements require 2/3rds of the directors to approve annual O&M budgets, those same agreements require unanimous approval to subsequently approve expenditures in excess of the budgeted total; this was corrected in the SOCRA agreement so a 2/3rds approval is required for O&M budgets and excess expenditures. This section follows the updated SOCRA agreement. Section 7.1 Bond financing terms are updated in this section to reflect current law and provide flexibility. Section8.1.1 The SERRA/SOCRA agreements permit aproject committee ofpnomember. This concept is established in this section, and includes the ability of the entire Board to impose conditions on the one -member committee's actions. Section 8.2 As in the SOCRA agreement and the SERRA PC 5 (Outfall) agreement, the terms allow a rnaJority of members of a project committee to modify, rehabilitate or improve a project if those members agree to pay all associated costs. StcCJzn9-1 This section deletes the requirement that an operations contract with a member to operate and maintain a JPA facility has to be executed be ore the project is built, since it inhibits flexibility as to the various existing facilities the JPA now owns for the members. Section 11.3 This section incorporates terms more commonly used in current joint powers arrangements and makes clearer that the member agencies' liabilities are based on project participation (i.e. capacity ownership) just as the prior AWMA/SERRA/SOCRA agreements did. There is no substantive change in the liability apportionment. A recognition of insurance coverage and an express indemnity from each member to the others for liability that exceeds a member's project participation also were added for clarity. Section 13.2 The SOCRA agreement includes a term requiring insurance be secured by the agency, and this requirement is included. BAWG/FG/5970727 BOWIE, ARNESON, WILES & GIANNONE Dave Catetto November 29, 2000 Page 4 Section 13.5 The arbitration clause is the some clause used in SOCRA's agreement, since that language was updated to a limited extent from the original clause in AWMNSERRA agreements. The basic terms are the same, but the procedures for notification and picking the arbitrator are slightly modified. The conduct of the arbitration and the teras for review and determination remain identical to the AWMA/SERRA agreements. IRWD is the successor to LAWD as of December 31, 2000. Rather than go through the exercise of an addendum to the AWMA/SOCRA agreements to approve IRWD (which would have to be approved by the members' separate boards and councils) at the same time the new JPA is under consideration, the proposal is to have the AWMA/SOCRA Boards adopt resolutions at the first available opportunity in 2001 recognizing IRWD as successor to LAWD and member in the new JPA in the future. Similarly, the same interim procedure would be used to address the pending merger of SJC and CV WD (a subsidiary district of SJC). "SJC/CV WD" is the signatory to the new JPA, as one member with one vote. I anticipate that at the first meeting of the new JPA, several organizational actions would be taken. This would include, as an example, a resolution to set the time and place for regular meetings, as well as adoption of a conflict of interest code to be filed with the County (which would mirror AWMAISERRA/SOCRAs'), and CEQA rules and regulations. If the members approach the new JPA Agreement pursuant to the current consensus and Board direction to use the AWMA/SERRA/SOCRA framework without extensive changes, then the enclosed draft agreement could be finalized in fairly short order for approval (i.e. February, 2001). Please let me know if I need to provide any other information to assist you and your staff with the consolidation at this time. BAWOMG1070727