Title
Recommendation to Authorize the City Manager to Execute Water Main Extension Agreements with East Bay Municipal Utility District (EBMUD) for Alameda Point’s Adaptive Reuse Areas Phase 1 and Phase 2 and Pay $212,072 and $153,885, Respectively, for the Required Design and Estimated Construction Cost Deposit. (Public Works 310)
Body
To: Honorable Mayor and Members of the City Council
EXECUTIVE SUMMARY
In the last two years, the City of Alameda (City) sold buildings in Alameda Point’s (AP) Adaptive Reuse Area. Per the 2017 Ten-Year Water Infrastructure Agreement (Agreement) between East Bay Municipal Utility District (EBMUD) and the City regarding AP, both phase 1 and phase 2, as shown in the Phasing Plan, are triggered based on the location of the building sales. The City submitted Water Main Extension Applications, within the required timeframe, and is now required to execute Water Main Extension Agreements with EBMUD and provide a design deposit, consisting of 10% of EBMUD’s design, inspection, and material costs.
BACKGROUND
On February 4, 2014, upon acquisition of major portions of AP from the Navy, the City Council approved the necessary planning documents for redevelopment of AP, including the Master Infrastructure Plan for Alameda Point (MIP). The approved MIP provides the master plan for the phased replacement of all of the Navy’s outdated and substandard utility infrastructure, including water, sewer, storm drain, electrical, gas, telecommunications, and surface street improvements at AP.
Pursuant to the MIP, new infrastructure will be implemented differently in the Reuse Area than in the Development Areas to address the specific infrastructure requirements needed to preserve the Naval Air Station Alameda Historic District (Historic District) in the Reuse Area. Due to the fact that the Reuse Area is comprised of the Historic District that constrains the new development process, the buildings within the Reuse Area are planned to be sold and reused incrementally to private property owners on a parcel-by-parcel basis. Upon receipt of funds from the sale of the properties within the Reuse Area, the City will oversee the logical implementation of the new infrastructure in the Reuse Area.
Currently, the City owns the water distribution facilities at AP, which connect to the EBMUD system at three master meters on Main Street. The water facilities were installed by the Navy and the majority of the system is over 60 years old.
On June 6, 2017, the City Council approved, and on June 14, 2017, EBMUD signed, a Ten-Year Water Infrastructure Agreement between EBMUD and the City regarding AP (Agreement) (Exhibit 1). Per EBMUD Regulations Governing Water Service to Customers (Regulations), private property owners within their potable water service area must be an EBMUD customer with direct access to EBMUD water infrastructure. This Agreement allows the City to sell parcels in the Reuse Area to private property owners, which is inconsistent with the Regulations, so long as the City remains in compliance with the terms of the Agreement. The Agreement requires the City to build out the water system replacements in the Reuse Area in phases, as shown in Exhibit C of the Agreement (Phasing Plan), and in accordance with the conditions and milestones contained in the Agreement.
Parcels sold in Phases 1 and 2 and the City met its deadlines, per the Agreement, to submit an EBMUD Mainline Extension Application, including all fire flow requirements, site improvement plans, tentative parcel map, among other materials and a non-refundable Water Service Estimate per EBMUD Regulations.
DISCUSSION
In response to the Water Service Applications submitted to EBMUD by the City, EBMUD prepared Water Main Extension Agreements for Phase 1 (Exhibit 2) and Phase 2 (Exhibit 3). The Water Main Extension Agreements were received on March 25, 2019 and March 26, 2019 for Phase 1 and 2, respectively.
Per the Agreement, the City must execute a Water Main Extension Agreement within three months of receipt, at which time, the City must also provide a design deposit, consisting of 10% of EBMUD’s design, inspection, and material costs. EBMUD’s Water Service Estimate, which itemizes the costs, are contained in the letter received with each Water Main Extension Agreement. The required deposit amount for Phase 1 is $212,072 and for Phase 2 is $153,885.
The charges for design deposits do not include the cost of installing individual services for the project. The City is also preparing Water Service Applications to transfer each domestic and fire service currently on the Navy water main to the new EBMUD water main, causing the owners/tenants of each parcel to be EBMUD customers in accordance with the EBMUD Regulations. As part of the Water Service Application process, EBMUD System Capacity Charges (SCC) and Wastewater Capacity Fees (WCF) will be due. As part of the Agreement, EBMUD provided the City with credits for SCC and WCF that it has from the future elimination of the three master meters at AP as specified in Exhibit E and F of the Agreement, respectively. On July 18, 2017, the City Council authorized the allocation of these credits toward all of the tenants and uses affected by the proposed Phasing Plan contained in the Agreement.
Upon execution of the Water Main Extension Agreements, EBMUD will proceed with completing the designs. The City and EBMUD will continue to work to determine required easements for water system that will be constructed outside of formally recorded public right-of-way.
Upon completion of the design, EBMUD will issue a Balance Due Letter to the City. The City has three months from the receipt of the completed design to obtain bids for construction and another six weeks to obtain City Council approval to award the construction contract.
ALTERNATIVES
If the City does not proceed in executing the Water Service Agreements, the City will be out of compliance with the Agreement and subject to enforcement by EBMUD.
FINANCIAL IMPACT
The City established Alameda Point Capital Projects Fund to account for capital activities within the area. At the same time, Capital Improvement Project 91890311 was set up in 2017 to receive building sale proceeds from the Adaptive Reuse Area to fund design and construction of the backbone improvements. Payments stipulated in the Water Main Extension Agreement will be paid from Alameda Point Capital Projects Fund. There is no impact to the General Fund as a result of this action.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action does not affect the Alameda Municipal Code.
ENVIRONMENTAL REVIEW
On February 4, 2014, the City of Alameda certified the AP Final Environmental Impact Report (EIR) in compliance with the California Environmental Quality Act (CEQA). The Final EIR evaluates the environmental impacts of redevelopment and reuse of the lands at AP consistent with the AP Zoning Ordinance and MIP, which included the Reuse Area.
CLIMATE IMPACTS
Construction will have greenhouse gas emission impacts; however, in conformance with the Green Building Standards, the City requires that 65% of all debris hauled from a project must be recycled by a certified Construction & Demolition Processor.
RECOMMENDATION
Authorize the City Manager to execute Water Main Extension Agreements with East Bay Municipal Utility District for Alameda Point’s Adaptive Reuse Areas phase 1 and phase 2 and pay $212,072 and $153,885, respectively, for the required design and estimated construction cost deposit.
CITY MANAGER RECOMMENDATION
The City Manager recommends approval to execute the Water Main Extension Agreement with East Bay Municipal Utility District for Alameda Point Adaptive Reuse Area phase 1 and phase 2.
Respectfully submitted,
Liam Garland, Public Works Director
By,
Erin Smith, Deputy Public Works Director
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibits:
1. Agreement between EBMUD and City of Alameda
2. Phase 1 Agreement
3. Phase 2 Agreement
cc: Eric Levitt, City Manager