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SR 11-15-2022 5C 502-002-04 / 505-001-04 City Council Report City Council Meeting: November 15, 2022 Agenda Item: 5.C 1 of 7 To: Mayor and City Council From: Rick Valte, Public Works Director, Public Works, Engineering and Street Services Subject: Award RFP #SP2666 to DRP Engineering, Inc. for the design of Water and Wastewater replacement project Recommended Action Staff recommends that the City Council: 1. Award RFP #SP2666 to DRP Engineering, Inc., to provide engineering design services, develop construction documents, and provide engineering support during the construction of the water, wastewater and recycled water main projects for fiscal years 2022-23 through 2026-27 for the Public Works Department. 2. Authorize the City Manager to negotiate and execute an agreement with DRP Engineering, Inc., in an amount not to exceed $1,322,991 (including $120,271 contingency) for two years, with three additional one-year renewal options in the amount of $2,136,503 (including $194,227 Contingency) on the same terms and conditions for a total amount not to exceed $3,459,494 over a 5-year period with future year funding contingent on Council budget approval. 3. Adopt a finding of Categorical Exemption pursuant to Section 15302 (Replacement/Reconstruction), of the California Environmental Quality Act (CEQA) Guidelines. The project consists of replacement or reconstruction of existing water and sewer main facilities where the new replacement will be in the same locations and will have substantially the same purpose as the structures replaced. Summary To ensure the delivery of safe, high quality and reliable water supply and wastewater services to the residents and business owners of Santa Monica, the City is required to replace the pipes and the facilities that are approaching the end of their useful lives. The FY 2022-23 - 2026-27 Water, Non-Potable Water, and Wastewater Main Replacement Project would design approximately 50,000 linear feet of water mains, 5.C Packet Pg. 144 2 of 7 39,600 linear feet of wastewater mains, and 5,000 linear feet of recycled water mains over the next five years. Staff recommends DRP Engineering, Inc. to provide engineering design services, develop construction documents, and provide engineering support during the construction phase of the projects for an amount not to exceed $3,459,494 over a five-year period which would be funded by $2,304,558 from Water Fund and $1,154,936 from the Wastewater Fund. Discussion The City owns, operates and maintains a 205-mile network of water distribution system and six miles of recycled water mains with pipeline sizes ranging from six to 36 inches. The City also owns, operates and maintains an extensive sanitary sewer collection system including approximately 154 miles of wastewater pipelines. Over time the useful life of these pipelines diminish due to age, soil conditions, and corrosion buildups. The City’s replaces an average of approximately 10,000 linear feet of water pipes and replace or rehabilitate 8,000 linear feet of wastewater pipes annually to meet the 100-year replacement cycle recommended by the City Council approved 2018 Updated Sustainable Water Master Plan and 2017 Sanitary Sewer System Master Plan (SSSMP). The first year of this 5-year project would replace 10,866 linear feet of water mains, replace 6,250 linear feet of wastewater mains, rehabilitate 3,150 linear feet of wastewater mains, and would install 1,800 linear feet of recycled water mains. Tables 1 and 2 show the segments of the water and wastewater main replacements, and Table 3 shows tentative segments for the recycled water mains that would be installed in the first year (FY 2022-23). The segments for future-year construction projects would be determined each year. Table 1- Water Main Replacement Project - First Year (2022-23) Street Name From To Installed Year Length Feet 10th Street Olympic Blvd. I10 Freeway 1967 520 5.C Packet Pg. 145 3 of 7 11th Street Olympic Blvd. East of Cloverfield 1961 425 Michigan Avenue East of Cloverfield 1325 feet to the East 1948 1,325 Euclid Court North of Olympic Blvd. I10 Freeway 1946 635 Ocean Avenue San Vicente Blvd. Adelaide Drive 1960 670 22nd Court Montana Avenue Georgina Avenue 1959/1975 3,000 Washington Avenue 17th St. 24th St. 1924 2,676 24th Street Michigan Avenue Delaware Avenue where it intersects with Frank St. Unknown 1,425 Euclid Court South of Olympic Blvd. Michigan Avenue 1946 190 Total 10,866 Table 2 - Wastewater Main Replacement/Rehabilitation Project - First Year (2022-23) Street Name From To Length Feet Wastewater Pipeline Replacement Segments Maple Street Sewer Maintenance Hole (SMH) 26-1295 at Euclid St. SMH 26-1295A in front of 1129 Maple St. 370 Maple Street SMH 26-1295A SMH 19-959 at 11th St. 330 9th Court SMH 17-702 at Michigan Avenue SMH 17-701at Olympic Blvd 200 Raymond Avenue SMH 19-945 at 7th St. SMH 19-942 at Highland St. 300 Hill Place North SMH 13-533 at 5th St. SMH 13-533A at 4th St. 200 Hill Place North SMH 13-533 at 5th St. SMH 13-532 at 5th St. 200 Hill Place North SMH 13-532 at 5th St. SMH 13-531 at 6th St. 150 5th Court SMH 13-532 at Hill Place North SMH 13-530 at Ocean Park Place South 200 Raymond Place North SMH 13-503 at 4th Court SMH 13-518 at 5th St Easement 350 Raymond Place North SMH 13-518 at 5th Easement SMH 13-519 at 6th St. 150 Pico Place South SMH 25-1203 E/O 11th St. SMH 18-821 W/O 11th St. 100 5.C Packet Pg. 146 4 of 7 Harvard Court SMH 46-2245 at Broadway SMH 46-2244 at Colorado Place North 500 Santa Monica Place South SMH-2257 at Harvard St. SMH 46-2255 at Yale St. 400 California Place South SMH 38-1842 at 24th St. SMH 38-1838 at Chelsea Avenue 300 24th Court SMH 38-1840 at California Place South SMH 38-1841 at Wilshire Place North 400 Washington Place South SMH 38-1814 at 24th St. SMH 38-1819 at Chelsea Avenue 300 24th Court SMH 38-1818 at Washington Place South SMH 38-1817 at California Place North 400 California Place South SMH 38-1845 at 23rd St. SMH 38-1843 at 24th St. 300 23rd Court SMH 38-1844 at California Place South SMH 38-1846 at Wilshire Place North 400 California Place South SMH 38-1852 at 22nd St. SMH 38-1854 at 23rd St. 300 22nd Court SMH 38-1853 at California Place South SMH 38-1848 at Wilshire Place North 400 Total 6,250 Wastewater Pipeline Rehabilitation Segments Franklin Court SMH 51-2422 at Santa Monica Place North SMH 51-2419 at Arizona Avenue 500 Chelsea Avenue SMH 38-1873 at Chelsea Place SMH at Arizona Avenue 350 24th Court SMH 45-2199 at Washington Place North SMH 44-2127 at Montana Place 950 Georgina Place North SMH 8-155 at 4th St. SMH 14-576 at 7th St. 1,350 Total 3,150 Table 3 - Recycled Water Main Expansion Project - First Year (2022-23) Street Name From To Installed Year Length Feet Pico Blvd. 17th St. 16th St. New 500 16th Street Pico Blvd.. Pearl St. New 1300 Total 1,800 5.C Packet Pg. 147 5 of 7 Consultant Selection On June 2, 2022, the City issued a Request for Proposal (RFP) to obtain engineering design services for water, recycled water, and wastewater mains replacement for five years from FY2022-23 through FY2026-27. A selection committee consisting of staff from the Engineering & Streets Services Division and the Water Resources Division reviewed the proposals and selected the top three firms to participate in the next round of the selection process. On August 18, 2022, staff interviewed the top three consulting firms and subsequently selected DRP Engineering, Inc. to provide the engineering design services for the project. Bidder Recommendation Best Qualified Person/Firm DRP Engineering, Inc. Evaluation Criteria Training/credentials/experience, competence/skill, capacity/ability to perform services promptly, sufficiency of financial/other resources, character/reputation, ability to provide future services as needed and price. Municipal Code SMMC 2.24.190 Proposals Received Cannon Corporation SA Associates Onward Engineering CWE Inc. DRP Engineering RFP Data Posted On Posted On Advertised in (City Charter & SMMC) Vendors Downloaded Date Publicly Opened 06/02/2022 City’s Online Bidding Site Santa Monica Daily Press 41 06/30/2022 Justification to Award The proposals were reviewed by a selection panel consisting of staff from the Engineering & Streets Services and Water Resources Divisions. The proposal evaluations were based on project understanding/workplan, previous experience, references, ability to deliver, quality of product, cost, and compliance with City requirements. Staff then interviewed three shortlisted firms. Based on the evaluation criteria and criteria in SMMC 2.24.190, staff recommends DRP Engineering, Inc., as the best qualified firm to prepare the Water, Non-Potable Water and Wastewater Main 5.C Packet Pg. 148 6 of 7 Replacement Project based on their extensive and prior experience in developing similar projects for other California municipalities and agencies including City of Anaheim, City of Long Beach, Suburban Water System, and Liberty Utilities. Past Council Actions Meeting Date Description 9/26/2017 (Attachment A) Approval of Sanitary Sewer System Master Plan (SSSMP) 11/27/2018 (Attachment B) Updated Sustainable Water Master Plans and Pathway to Water Self-Sufficiency Environmental Review Staff has performed a preliminary environmental assessment of a portion of this project, which would replace water and wastewater mains and has determined that it falls within the Categorical Exemption set forth in 15302 of the CEQA Guidelines which exempts replacement or reconstruction of existing structures and facilities where the new structure will be located in the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced because this project would replace and rehabilitate existing water mains and wastewater mains. Furthermore, Staff has determined that none of the exceptions to Categorical Exemptions set forth in the CEQA Guidelines, section 15300.2 apply to this project. Specific details regarding the design, layout, size, and location for installation of new recycled mains are not available and would be determined as part of this design contract. Once details regarding these segments are finalized and determined, Staff would perform the necessary environmental review in compliance with CEQA. Environmental documentation pursuant to CEQA would be prepared and completed prior to, or in conjunction of the approval of the installation of new mains. Financial Impacts and Budget Actions Staff seeks authority to approve available funding from Water and Wastewater Funds to award a 5-year design contract to DRP Engineering, Inc. for design and construction 5.C Packet Pg. 149 7 of 7 engineering support services for the FY 2022-23 through 2026-27 Water, Non-Potable Water and Wastewater Main Replacement Project. Future year funding is contingent on Council budget approval. FY 2022-23 Amount Future years amount CIP Account # Total Contract Amount $188,208 $303,922 C5004870.689000 $492,130 $692,647 $1,119,781 C5004840.689000 $1,812,428 $442,136 $712,800 C5104860.689000 $1,154,936 $1,322,991 $2,136,503 Total $3,459,494 Prepared By: Tom Shahbazi, Civil Engineer Approved Forwarded to Council Attachments: A. Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency B. Sanitary Sewer System Master Plan C. OaksInitiative-wEx _DRP 5.C Packet Pg. 150 City Council Report City Council Meeting: November 27, 2018 Agenda Item: 8.C 1 of 40 To: Mayor and City Council From: Susan Cline, Director, Public Works, Water Resources Subject: Sustainable Water Master Plan Update and Pathway to Water Self- Sufficiency Recommended Action Staff recommends that the City Council: 1. Provide staff with direction to proceed with water self-sufficiency components. 2. Provide staff with direction regarding funding recommendations to achieve water self-sufficiency. 3. Authorize budget changes as outlined in the Financial Impacts and Budget Actions section of this report. 4. Direct staff to return for a public hearing on January 8, 2019, to consider implementation of 9% water rate increase previously approved by Council on February 24, 2015 to go into effect on March 1, 2019. Executive Summary The City of Santa Monica (City) has historically provided water service to residential and business customers allowing for bold efforts in securing resiliency and self-sufficiency for the community. Given the statewide challenges surrounding a safe and reliable water supply in recent years, Council directed staff to develop a water self-sufficiency plan with the goal of meeting 100% of Santa Monica’s water demand using local water sources by 2020. On October 28, 2014, Council adopted the Sustainable Water Master Plan (SWMP), which outlines a strategy to achieve the City’s water self-sufficiency goal (Attachment A). Staff initiated a comprehensive update of the SWMP in 2017 to incorporate new information regarding local groundwater resources and to integrate new water conservation programs and alternative water supply opportunities. On January 9, 2018, staff reported to Council that further analysis was needed to assess whether the City could meet its water self-sufficiency goal by 2020 (Attachment B). The further analyses have been completed and confirm that achieving water self-sufficiency that can be maintained into the future is practical and cost effective, but the projected 5.C.a Packet Pg. 151 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 2 of 40 date of reaching that goal would be 2023. The delay from the original date is due to new state drinking water requirements implemented in 2018, permitting requirements for alternative water supply projects, and results of recently completed feasibility studies which resulted in longer timelines for project completion relative to previous estimates. The benefits of becoming water self-sufficient when compared to the alternative of continuing to meet a portion of local water demand using imported water include: long- term cost benefits for water ratepayers, establishment of a diverse, sustainable and drought resilient local water supply, and reduction of the City’s water supply energy footprint. It should be noted that in the updated plan proposed by staff, water self- sufficiency equates to approximately 99% locally sourced water, with 1% of the City’s water supply still being purchased from the Metropolitan Water District of Southern California (MWD) to maintain the imported water connection for emergency purposes. The updated proposal to meet water self-sufficiency presented in this staff report includes an optimized water conservation program together with local water supply projects, an updated implementation timeline, and recommended funding toward achieving water self-sufficiency for the City. Following Council direction and approval, the final components will be included in an updated SWMP that will guide City efforts toward achieving the goal through 2023. To achieve self-sufficiency by 2023, staff is proposing to replace imported water purchases with a comprehensive plan consisting of: Component 1 - continuing and increasing water conservation efforts to permanently reduce water demand, Component 2 - developing sustainable and drought resilient alternative water supplies, and Component 3 - expanding local groundwater production within sustainable yield limits. The anticipated cost to implement the components required to meet the self-sufficiency goal is approximately $38 million to increase local water supplies, which includes capacity expansion of the Arcadia Water Treatment Plant (WTP), implementation of 5.C.a Packet Pg. 152 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 3 of 40 production efficiency enhancements, as well as acquiring an additional groundwater well to enhance resiliency. The $38 million would be funded primarily through the issuance of a water revenue bond and a contribution from the Wastewater Fund ($3.25 million) to the Water Fund to fund the various projects outlined in this staff report, with the debt service on the bonds incorporated into water rates in an upcoming rate study. An additional $64 million from existing water-contamination settlement funds would be used for restoring the Olympic Sub-basin, which would allow additional water production from that sub-basin to support achievement of water self-sufficiency. The proposed water self-sufficiency plan and staff recommendations are based on recently completed studies (e.g., confirmation of sustainable yield analysis, evaluation of new drinking water regulations on the Olympic Sub-basin restoration, and feasibility studies to assess new technologies that increase production efficiency at the Arcadia WTP) in which multiple scenarios were evaluated for cost, benefits and effectiveness. Lastly, staff will return to Council on January 8, 2019, for a public hearing and to recommend a full implementation of the 9% water rate adjustment (within the previously adopted Council authorization) for calendar year 2019 and effective on water bills issued on or about March 1, 2019. The recommended water rate adjustment would ensure a fiscally sustainable comprehensive program for safe, clean, reliable water supply to our community. It would also help offset increased construction costs to keep up with the City’s 100-year water main replacement program and fund preliminary design efforts on the various components required to achieve water self-sufficiency as contemplated in the 2014 rate study. Background On January 25, 2011, City Council directed staff to develop a water self-sufficiency plan with the goal of meeting 100% of Santa Monica’s water demand using local water sources by 2020. On October 28, 2014, Council adopted the SWMP which outlines a comprehensive plan to achieve water self-sufficiency. The SWMP involves a combination of water demand reduction strategies through various water conservation and efficiency programs designed to permanently reduce residential and commercial 5.C.a Packet Pg. 153 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 4 of 40 water use, along with increased water supply from 1) alternative water sources such as captured rainwater and treated wastewater; 2) increased efficiency of the City’s water treatment systems; and 3) additional pumping from existing groundwater wells and new wells in the local groundwater basin. Implementation of the SWMP has been proceeding since 2014, with updates provided during Council’s annual consideration of water rate adjustments. The most recent update was provided on January 9, 2018. Between 2014 and 2018, other elements of the SWMP progressed, including completion of a preliminary Sustainable Yield Analysis (SYA) of the Santa Monica groundwater basin and finalizing plans for the Sustainable Water Infrastructure Project (SWIP) to support further analysis and refinement of alternatives to reduce reliance on imported water supply and meet the City’s self-sufficiency goal. Staff initiated a comprehensive update of the SWMP in 2017 to incorporate new information regarding local groundwater resources, regulatory updates, and to integrate new water conservation programs and alternate water supply opportunities. On January 9, 2018, staff reported to Council that further analysis was needed to assess whether the City could meet its water self-sufficiency goal by 2020. Additional work completed since January 2018 included analysis to validate preliminary SYA estimates of the local groundwater basin, drilling of exploratory water wells in the Coastal sub-basin to evaluate potential new local water production, technical studies to evaluate the cost and viability of increasing the production efficiency of the City’s Arcadia WTP, evaluating the impact of new drinking water regulations (e.g., maximum contaminant level [MCL] for 1,2,3 TCP) on groundwater extraction from the Olympic Sub-basin, and evaluating the cost and viability of additional water conservation programs as requested by the Task Force on the Environment. A timeline summarizing key events related to the development of the SWMP from 2011 is provided in Figure 1. Staff currently anticipates that the City would achieve water self-sufficiency in 2023 based on the plan outlined in this report. In addition to the proposed plan to achieve water self-sufficiency, a Five-Year Rate Study (2020-2024) is also currently underway and will consider potential rate impacts of water self-sufficiency projects. Results of the Five Year Rate Study will be presented to Council in the first half of 2019. 5.C.a Packet Pg. 154 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 5 of 40 January 25, 2011 City Council directed staff to develop water self-sufficiency plan (100% on local water supplies) Council adopts Sustainable Water Master Plan (Oct ’14) Plan outlines the City’s strategy to achieve water self-sufficiency Olympic Treatment Pilot Project Initiated (Sept ’14) Evaluate treatment technologies to restore pumping capacity at Olympic Sub Basin SWMP Update (Nov ‘18) Staff to present strategy to meet City’s water self- sufficiency goal Conservation Plan Implemented (2015) Increased conservation efforts saw a ~20% reduction in gallon per capita per day (gpcd) water consumption SWMP Update (Jan ‘18) Staff reported to City Council that additional analysis was needed to determine if self- sufficiency goal could be met by 2020 New Contaminant at Olympic Sub Basin (May ‘18) New drinking water regulations required additional analysis of Olympic Sub Basin treatment strategy Water Self- Sufficiency Achieved (2023) Figure 1: Self-Sufficiency Timeline Discussion Goals and Benefits of Water Self-Sufficiency The proposed plan to meet the City’s self-sufficiency goal involves a combination of demand reduction through various water conservation and efficiency programs and the addition of local water supplies which will also provide the following benefits: Long-term cost benefits to ratepayers by maximizing local water resources Provide a more sustainable and drought-resilient water supply through a diversified water supply portfolio Reduce the City’s water supply energy footprint through conservation and locally sourced water supplies With imported water purchase costs from MWD expected to increase annually from 3 to 7 percent over the next 10 years, the primary focus of the updated SWMP was to develop water self-sufficiency scenarios that are both sustainable and economical compared to the continued purchase of imported water from MWD. Development of 5.C.a Packet Pg. 155 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 6 of 40 cost-effective local, sustainable, and drought resilient water supplies will provide Santa Monica water ratepayers with cost benefits over the long-term and provide the City with greater cost certainty on water rates compared to the continued purchase of imported water from MWD. Providing a sustainable and drought-resilient water supply through a diversified water supply portfolio eliminates the City’s reliance on the purchase of imported water from MWD and maintains reliable production during routine maintenance and unforeseen downtimes of treatment equipment. Lastly, maximizing local water resources instead of purchasing imported water from MWD also has long-term environmental benefits for the community in terms of reduced energy use and the associated reduction in greenhouse gas emissions, which support Council’s goal to achieve carbon neutrality by 2050 or sooner. The addition of alternative water supplies, expansion of local groundwater supplies, and increased conservation will result in a 25-30% reduction of total energy footprint from the City’s water supply compared to continued purchase of imported water from MWD. Marching Toward Water Self-Sufficiency The City’s water supply portfolio has progressively transformed since 2011, with the community making significant strides toward water self-sufficiency and reduced reliance on the purchase of imported water to supplement local water resources as indicated in Figure 2. In 2011, after completion of the Charnock Wellfield Restoration Project, the City was able to meet approximately 51 percent (~6,700 acre-feet per year [AFY]) of its water supply demand through local groundwater resources and reduce the purchase of water from MWD, which is imported from Northern California and the Colorado River, to approximately 48% (~6,400 AFY). 5.C.a Packet Pg. 156 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 7 of 40 Figure 2: Overview of City’s Water Supply Portfolio from 2011 through 2017 In 2015, the City and its residents responded to severe drought conditions throughout California with conservation efforts that resulted in a decrease in the City’s total water demand of 14,300 AFY in 2014 by about 17% (-2,500 AFY) to approximately 11,800 AFY by 2017. Santa Monica’s population grew by about 1.6% from 92,321 to 93,834 over the same period. Conservation efforts resulted in a decrease in average annual water consumption, measured in gallons per capita per day (GPCD), from 140 GPCD to approximately 110 GPCD as indicated in Figure 3 and continues today even after the governor declared an end to the drought. 5.C.a Packet Pg. 157 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 8 of 40 Figure 3: Historical Population Growth versus Per Capita Water Consumption From 2015 through 2017, the City was meeting approximately 50-56% of its water supply demand through local water sources (7,400-8,200 AFY) and 26-29% through water conservation (approximately 2,500 AFY), with the amount of imported water purchased from MWD dropping to approximately 26-29% (3,700-4,100 AFY). In 2017, local groundwater supply temporarily decreased due to an extended shutdown (approximately six months) of one well in the Charnock sub-basin for maintenance and repair. The loss of a single well from the Charnock Sub-basin over the six-month period and loss of approximately 800 AFY of groundwater production highlighted the need to increase resiliency of the local water supply to maintain reliable production as the City continues its march toward water self-sufficiency. Refined SWMP Pathway to Achieve Water Self-Sufficiency Additional analyses of various elements of the SWMP, as outlined at the January 9, 2018 City Council meeting, have been completed, and based on those analyses staff now estimates that water self-sufficiency can be achieved by 2023. To achieve self- sufficiency by 2023, staff is proposing to replace the purchase of imported water from MWD (approximately 50% of the total water supply demand when self-sufficiency efforts were initiated in 2011) with a comprehensive plan consisting of: 1) Component 1 - continuing and increasing water conservation efforts to permanently reduce water demand, 2) Component 2 - developing sustainable and drought resilient alternative 5.C.a Packet Pg. 158 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 9 of 40 water supplies, and 3) Component 3 - expanding local groundwater production within sustainable yield limits. The delay in achieving the City’s self-sufficiency goal from 2020 to 2023 is due to several factors, including new regulations established by the State Water Resources Control Board’s Division of Drinking Water (DDW) that required further analysis to determine the level of treatment required for the Olympic Sub-basin, the project timeline and permitting schedule for the SWIP project to recharge local groundwater aquifers with purified water, and the need to confirm and refine preliminary SYA estimates with additional data to establish an accurate estimate of the sustainable yield for the Santa Monica Groundwater Basin. The remainder of this staff report is organized as follows to provide detailed descriptions of each component of the updated SWMP and its contribution/benefits toward the City’s self-sufficiency goal: Proposed Plan to Achieve Water Self-Sufficiency SWMP Project Cost and Implementation Schedule Funding Recommendations Proposed Plan to Achieve Water Self-Sufficiency A comprehensive plan was developed through the SWMP and comprises three components that provide a path for the City to achieve water self-sufficiency by 2023. The contribution of each proposed component to eliminate reliance on imported water supply by 2023 is summarized in Figure 4 along with the percent contribution toward replacing imported water purchases. In total, the three components: 1) conservation, 2) alternative water supplies - production efficiency, recycled water, and purified water for recharge, and 3) new local groundwater will contribute approximately 8,057 AFY toward the City’s total water supply and reduce imported water purchase to only 170 AFY. A brief description of each of the recommended components is provided below. 5.C.a Packet Pg. 159 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 10 of 40 New Local Groundwater, 2,100 AFY, 25% Imported Water (MWD), 170 AFY, 2% Alternative Water Supply - Purified Water (Recharge), 1,100 AFY Alternative Water Supply - Recycled Water , 560 AFYAlternative Water Supply -Production Efficiency, 1,200 AFY Conservation, 3,097 AFY, 38% PROPOSED STRATEGIES TO REPLACE IMPORTED WATER SUPPLY (2023) New Local Groundwater Imported Water (MWD) Alternative Water Supply - Purified Water (Recharge)Alternative Water Supply - Recycled Water Alternative Water Supply - Production Efficiency Conservation Alternative Water Supply, 2,860 AFY, 35% Figure 4: Summary of Proposed Components to Replace Imported Water Supply by 2023 Component 1 - Conservation (38% Reduction in Imported Water Purchases) In 2014, Council authorized the significant expansion of staffing and funding to augment the City’s water conservation efforts to address the state-wide drought and help the City meet its self-sufficiency goal. This contributed to a water demand reduction of approximately 20% over the past three years (2015-2017), which equates to saving approximately 2,500 AFY. Continued implementation of the existing conservation programs with the addition of supplemental conservation efforts is expected to continue this trend of water demand reduction through 2040, with the staff recommended Optimal conservation plan which is described below. Continuation of existing, and implementation of proposed, conservation programs are essential for the City to eliminate reliance on imported water from MWD. The recommended Optimal conservation plan will contribute approximately 3,100 AFY to the City’s water supply portfolio in 2023 and reduce imported water purchases by roughly 38%. Staff modeled three conservation plans (Optimal, Enhanced, and 90 GPCD), which are presented in gallons per capita per day by 2025 and abbreviated as GPCD. The Optimal Conservation Plan can be completed using existing budgeted resources and would reduce the City’s total water demand by approximately 20%, even after factoring in demand increases associated with expected population growth through 2025. 5.C.a Packet Pg. 160 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 11 of 40 Increasing conservation efforts from the Optimal to the Enhanced Plan would cost an additional $7.2 million in total program cost, on top of the budget already allocated for the Optimal Conservation Plan, but with a marginal increase in water conserved (approximately 2% additional reduction in GPCD with the Enhanced Plan). The enhanced conservation plan would still require approximately 3,500 to 3,700 AFY of water that would need to be met through the purchase of imported water or from the development of additional local water resources. With marginal gains from increased conservation efforts compared to the additional implementation cost required, staff is recommending continuing with the optimal conservation plan, which costs approximately $708/AF of water saved. A third, aggressive conservation plan was also studied following a request by the Task Force on the Environment to evaluate the cost and feasibility of reducing city-wide water demand to 90 GPCD by 2025. The assessment of the 90 GPCD Plan conducted by staff concluded that reducing overall water demand to 90 GPCD would be extremely costly and may not be feasible for implementation. The overall cost to implement this plan would exceed $56.6 million, with $40 million of the cost incurred over the first five years. In addition to the significant cost premium, this scenario would likely require additional staffing and would be very challenging to achieve by 2025. Staff met with industry experts to review and receive input on the City staff modeling of proposed conservation programs. A panel of outside experts supported both the optimal and enhanced conservation plans and the proposed programs that comprise them. A summary of the conservation scenarios evaluated is provided in Table 1. Table 1: Summary of Conservation Scenarios Considered Description1 Conclusion Cost Optimal, 108 GPCD  Best Conservation option  Does not achieve self-sufficiency goal by itself but supports demand reduction. Within current operating budget $708/AF (over 30 years) 2 Enhanced, 106 GPCD  Feasible but expensive compared to Optimal Plan. Requires 1.5 new staff for 10 years $7.2 million increase in program costs compared to Optimal (2018-2023) 5.C.a Packet Pg. 161 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 12 of 40  Does not achieve self-sufficiency goal  Not worth the incremental cost for a 2GPCD reduction. 137% increase in budgeted costs (2018-2013) $1,078/AF (over 30 years) 2 Aggressive, 90 GPCD  Potentially feasible but very expensive, requires 2.5+ new staff for 10 years  Does not achieve self-sufficiency goal $40.8M over the first five years; $58.6 M 2019-2040, 800% increase in costs (2018- 2023) compared to Optimal Scenario ~$1,280/AF (over 30 years)2 1GPCD based on water conservation efforts achieved as of 2025 2Excluding ongoing conservation staffing cost. Due to conservation efforts since 2015, the City’s current water demand measured in gallons per capita per day (GPCD) is approximately 110 GPCD. Staff also conducted a theoretical exercise to determine what would be required for the City to become water self-sufficient solely through conservation efforts (assuming no imported water and no additional local water production). Results of that exercise indicated that the total per capita water demand would need to be reduced to 64 GPCD. Staff consulted water conservation experts, analyzed conservation efforts in other cities and evaluated various local conservation scenarios and determined that attempting to achieve the self- sufficiency goal through conservation alone (i.e. achieving 64 GPCD in Santa Monica) is neither financially feasible nor realistic within the time horizon. However, the community should be commended on the conservation efforts already taken to reduce water demand and decrease imported water purchased from MWD. Santa Monica is - and can be - a model for a new ethic of resource self-sufficiency and environmental sustainability. The Council’s recent adoption of the 100% renewable default rate for community electric supply represents this ethos of “living within our means.” Conservation will continue to play a critical role in the City’s march toward water self-sufficiency by continuing to reduce overall water demand in the face of continued population growth from new housing and demand from the commercial and institutional sectors of our local economy. 5.C.a Packet Pg. 162 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 13 of 40 Based on the modeling described above, staff recommends pursuing the Optimal conservation plan, which continues the successful conservation programs initiated over the past three years and increases water conservation in untapped areas such as: Funding of retrofits in Santa Monica-Malibu Unified School District facilities and landscapes Commercial sector fixture retrofits and enhanced rebates Coin-operated laundry machine retrofits Increase in Water Neutrality offsets and direct installs Rebates for new technologies including gray and black water systems Enhanced water conservation education and enforcement Additional sustainable landscape conversions Outreach to assist customers on how to properly adjust their irrigation timers New marketing and outreach campaign focusing on instilling permanent conservation behaviors consistent with the state’s forthcoming framework for “Making Water Conservation a California Way of Life” Incorporating limited-term employees as part of the permanent water conservation team to ensure new state requirements and regulations are met, as well as maintaining programs at an effective level In developing the water conservation plan to reach and maintain self-sufficiency, the City evaluated the potential for further water efficiency and conservation in all customer sectors. This included an assessment of the current level of water fixtures in the city, as well as identifying where the greatest opportunity for reducing water consumption existed. Based on this analysis, a program plan was developed to reach the City’s long- term objectives via existing and new conservation programs. Table 2 shows the projects planned over the next five years including the number of activities for each program such as number of rebates, consultations and direct installation of water efficient fixtures to replace inefficient fixtures in existing buildings 5.C.a Packet Pg. 163 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 14 of 40 throughout the city. The projected number of activities is based on historical participation, available market of opportunity, and strategic community engagement campaigns to increase programs over multi-year periods. The table also includes the estimated water savings and total costs from 2018 through 2023 when water self- sufficiency is expected to be reached. Table 2: Summary of Optimal Water Conservation Programs and Results Measure Customer Class Total Activities 2018-2023 Total Water Savings (AF) 2018-2023 Rebates, Single Family (i.e. clothes washers, landscape, soil sensors, toilets, irrigation)Single Family 4,660 286 Water Use Consultations, Single Family Single Family 720 58 Graywater System Incentive Single Family 60 1 Direct Installs, Single Family (i.e. 0.80 gpf toilets, water neutrality) Single Family 0 0 Direct Installs, Multi-Family (0.80 gpf and 1.06 or less gpf toilets)Multi-Family 3,750 124 Rebates, Multi-Family (i.e. high-efficiency clothes washers, landscape, toilets)Multi-Family 1,475 94 Water Use Consultations, Multi-Family Multi-Family 750 90 School Education Program Institutional 2,090 14 Direct Installs, Santa Monica Malibu Unified School District (i.e. 0.80 gpf and 0.125 gpf toilets and urinals, water neutrality) Institutional 537 9 Santa Monica Malibu Unified School District Weather Based Irrigation Controller Incentive Institutional 22 21 Santa Monica Malibu Unified School District Landscape Incentive Institutional 9 8 Rebates, Commercial & Institutional (i.e. ice machines, toilets, urinals, toilets, irrigation)Commercial & Institutional 1,792 260 Direct Installs, Commercial & Institutional (i.e. toilets and urinals) Commercial & Institutional 3,280 517 Water Use Consultations, Commercial & Institutional Commercial & Institutional 300 45 Performance Pays Commercial & Institutional 4 9 Soil Moisture Sensor Rebates Multi-Family, Commercial & Institutional 75 7 Water Saving Devices - Faucet Aerators All 9,240 328 Water Saving Devices - Showerheads All 4,200 160 Community Outreach & Education All 16 1 Pilot Projects All 2 2 32,982 2,034Total The financial summary of the Optimal Conservation Plan is provided in Table 3. Table 3: Financial Summary of Optimal Water Conservation Plan Average Water Savings (AFY) 610 Cost of Savings per Unit Volume ($/AF) 5.C.a Packet Pg. 164 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 15 of 40 $708 Modeling of the water conservation plan was purposefully conservative and only includes expected water demand reductions directly related to City efforts. Therefore, the projected demand reductions do not include the potential savings from efficiency improvements in California State Plumbing Codes known as “passive conservation.” Passive water conservation is achievable through non-City sponsored programs, such as maximizing current plumbing code enforcement, landscape ordinances, natural fixture replacement rates, as well as future local and state regulations and codes. This includes the impact and enforcement of the legislation, California SB 407, requiring noncompliant plumbing fixtures in any single-family residential and multi-family residential, and commercial properties to be replaced by the property owner with water- conserving plumbing fixtures. Through the currently established programs, proposed new programs, and passive conservation, it is estimated that the City can reach 99 GPCD by 2025 and 96 GPCD by 2030. These efforts would result in an estimated additional annual savings between 680 acre-feet (AF) per year by 2025 and as much as 1,000 AF per year in 2030. The City allocates funding for conservation within the water fund annual operating budget; no additional funding would be required to implement the Optimal Conservation Plan. Staff will return during the Five-Year Rate Study to present long-term staffing options for the recommended Optimal Conservation Program. Component 2 - Alternative Water Supplies (35% Reduction in Imported Water Purchases) To further diversify the City’s water supply portfolio and increase overall resilience, three alternative water supply projects are proposed and collectively offset imported water purchases from MWD by 35 percent (see Figure 4). These projects include: Increase recycled water production through the Sustainable Water Infrastructure Project (SWIP), upgrading the existing Santa Monica Urban Runoff Recycling 5.C.a Packet Pg. 165 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 16 of 40 Facility (SMURRF) and constructing a new Advanced Water Purification Facility (AWPF) that provides a drought resilient, local water supply. The increase in recycled water production from SMURRF would offset imported water purchases from MWD by approximately 4% (approximately 560 AFY). Recharge local groundwater aquifers in the Olympic Sub-basin to maintain sustainable yield pumping levels with purified water from the SWIP’s AWPF. The purified water from the AWPF would offset imported water purchases from MWD by approximately 7% (approximately 1,100 AFY). Upgrade the City’s Arcadia Water Treatment Plant (WTP) with new technology to increase overall production. Closed Circuit Reverse Osmosis (CCRO) would be added to the Arcadia WTP to treat the Reverse Osmosis concentrate waste stream, which is currently discharged to the sewer system, and increase the overall treatment efficiency at the Arcadia WTP to approximately 90 percent, or greater. The addition of CCRO at the Arcadia WTP would offset imported water purchases from MWD by approximately 8% (approximately 1,200 AFY). The SWIP project is a major component of the alternative water supply for the City as it will provide a sustainable and drought resilient water supply by providing purified water to recharge local groundwater aquifers. In return, the aquifer recharge that will be provided by the SWIP will allow the City to maximize groundwater pumping, within sustainable yield limits, from the Olympic Sub-basin. Component 3 - New Local Groundwater Production (25% Reduction in Imported Water Purchases) To offset the remaining imported water purchased from MWD, local groundwater production would need to be increased to reduce imported water purchases from MWD by 25% and resiliency measures implemented to maintain reliable production. Staff developed and analyzed seven scenarios to expand the City’s groundwater production and carefully vetted each scenario internally and with outside industry experts. The seven scenarios were compared based on project feasibility, capital, and operation cost, and are summarized in Attachment C. All scenarios evaluated assume 5.C.a Packet Pg. 166 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 17 of 40 that the Optimal Conservation Plan is implemented. Of the seven scenarios evaluated, Scenario 1 - Expansion of Arcadia WTP with Closed Circuit Reverse Osmosis (CCRO) combined with a Separate Olympic Sub-basin Pipeline and Treatment at the Arcadia WTP site is recommended. Scenario 1 combined with the Optimal Conservation Plan is the most cost-effective solution to achieve self-sufficiency and maximize local water resources. Scenario 1 includes the following elements: Expansion of the Arcadia WTP, including CCRO technology (as discussed under component 2 - alternative water supplies), to increase treatment capacity and accommodate future 2040 water demands. Acquisition of a new groundwater well to enhance resiliency. Olympic Sub-basin Restoration: o A new pipeline separating Olympic Sub-basin water, conveying it independently to the Arcadia WTP, thus requiring a smaller treatment facility at the Arcadia WTP to remove contaminants in the Olympic Sub-basin. o Separate contamination treatment facility at the Arcadia WTP for the Olympic basin. Expansion at Arcadia WTP To support development of alternative water supplies and restoration of the Olympic Sub-basin, treatment capacity expansion and plant upgrades are required at the Arcadia WTP to support an overall increase in water production and enhance resiliency to achieve water self-sufficiency. The Arcadia WTP is currently capable of treating up to approximately 11,300 AFY (10 million gallons per day [mgd]) and produce 9,900 AFY (8.9 mgd) of treated water (approximately 82% recovery or efficiency). The proposed expansion and addition of new technologies to increase production efficiency at the Arcadia WTP will increase its treatment capacity to approximately 14,700 AFY (13 mgd) and produce 13,400 AFY (12 mgd) of treated water (approximately 92% recovery or efficiency). The proposed improvements for expanding production capacity at the Arcadia WTP and enhancing water supply resiliency include: 5.C.a Packet Pg. 167 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 18 of 40 Acquire an additional groundwater well to enhance resiliency and maintain production during routine maintenance or unforeseen downtimes of groundwater wells, while aggressively pumping within the sustainable yield. Install new CCRO to increase overall plant efficiency to 90 percent or greater (as discussed previously under component 2 - alternative water supplies). Expand capacity (e.g., pumps, blowers, cartridge filters, etc.) of the Arcadia WTP to accommodate increased groundwater production and new technologies (e.g., CCRO described in Component 2). Olympic Sub-basin Restoration The Olympic Sub-basin plays a key role in achieving the City’s water self-sufficiency goal as it could provide up to 3,200 AFY of groundwater and is also the location where purified water from the SWIP will be recharged to sustain this pumping rate. However, the Olympic Sub-basin contains several contaminants that would require additional treatment to meet drinking water standards. The key contaminants in the Olympic Sub- basin include: 1,2,3-Trichloropropane (1,2,3-TCP), 1,4-Dioxane, trichloroethylene (TCE), and tetrachloroethylene (PCE). Drinking water regulations, or maximum contaminant levels (MCL), have been in place for TCE and PCE prior to January 2018, and regulations for 1,2,3- TCP were established after January 2018 which required further treatment analysis. 1,4-Dioxane is currently on the State of California’s drinking water Notification Level (NL) list, which is a health-based advisory level and not an MCL. It is anticipated that the NL of 1 microgram per liter (g/L) or part per billion (ppb) for 1,4-Dioxane will likely become an MCL in the near future (within next 5 years). Further analysis of treatment options for the Olympic Sub-basin was required due to a recently established drinking water regulation that established a MCL for 1,2,3 TCP at 5 parts per trillion (ppt), and additional data on 1,4 Dioxane was available to refine the treatment analysis to determine if the current 1 ppb NL (anticipated future MCL) could be met once full production of the Olympic Sub-basin is restored. The Olympic Sub- basin treatment analysis was performed by an outside consultant, Black & Veatch. Key findings of the treatment analysis are listed below: 5.C.a Packet Pg. 168 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 19 of 40 1,2,3-TCP was only detected at one well, SM-4, and the MCL of 5 ppt could be met through blending with other wells at full production capacity. 1,4-Dioxane is present in all three wells (two existing and one future) and could limit groundwater production from the Olympic Sub-basin to 845 AFY or approximately 25% of the basin’s total sustainable yield. Other contaminants, TCE and PCE, do not impact groundwater production from the Olympic Sub-basin as they would be removed through existing treatment processes at the Arcadia WTP. To maximize groundwater production from the Olympic Sub-basin and comply with regulation on the key contaminants of concern, the following improvements are recommended: Increase groundwater pumping from existing wells (SM-3 and SM-4), complete equipping and permitting of one recently installed new well (SM-8) and install a replacement well (SM-9) to increase local production from this sub-basin to ~3,200 AFY within sustainable yield levels. Please note that purified water from the SWIP will be used to recharge the Olympic Sub-basin that helps maintain the sustainable yield levels by supplementing naturally available groundwater within the sub-basin. Design and procurement efforts are currently underway, and the well projects were previously approved by Council in the FY 19-20 Capital Improvement Budget. Construct a new pipeline to separate Olympic Sub-basin groundwater from Charnock wellfield groundwater for separate treatment at the Arcadia WTP, primarily to target removal of 1,4 Dioxane. This reduces the amount of water needing treatment since only the Olympic Sub-basin flows (3,200 AFY) contain 1,4 Dioxane. If the flows are not separated, 14,700 AFY (Olympic + Charnock) would need to be treated. Construct a new contamination treatment facility for only the Olympic Sub-basin flows to remove 1,4 Dioxane, 1,2,3-TCP, TCE, and PCE at the Arcadia WTP site. The proposed treatment train consists of the ultraviolet light advanced oxidation 5.C.a Packet Pg. 169 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 20 of 40 process and granular activated carbon. With the new contamination treatment facility and increased production efficiency (90-92% recovery) at the Arcadia WTP, approximately 2,900 AFY of treated water will be produced from the 3,200 AFY extracted from the Olympic Sub-basin. The new contamination treatment facility will provide high-quality drinking water that meets current and future regulatory standards. Sustainable Yield Update The sustainable yield from the Santa Monica Groundwater Basin is a critical component to ensure overall groundwater production is within sustainable limits of the basin and could support the proposed projects described above on an ongoing basis. A preliminary Sustainable Yield Analysis, (SYA), prepared by Richard C. Slade & Associates (Slade) in 2017, was presented to Council in January 2018. Since then, additional work was performed to refine and update the SYA. Additional work included the Coastal Sub-basin Exploratory Boring Program and a digital elevation mapping study that analyzed the potential recharge from the nearby mountain front. The updated report contains findings from this recently completed work as well as 2017 data regarding rainfall, geology, static water levels in key wells, and groundwater withdrawals from active City wells and other known private well owners (Attachment D). The updated SYA estimate from Slade’s analysis for the Santa Monica Basin is between 11,800 and 14,725 AFY. To substantiate the assessment conducted by Slade, City staff contracted with consultants from ICF to perform a separate estimate of the sustainable yield using a water-balance approach. This method compares the amount of water that recharges into a basin (inflow) from a wide range of sources (natural and anthropogenic), with the amount of water leaving the basin (outflow) from losses caused by pumping, evapotranspiration, basin outflow, etc. ICF’s assessment also considered findings from both the digital elevation mapping and Differential Interferometric Synthetic Aperture Radar Study (DInSAR) studies, presented to Council in January 2018. Based on ICF’s water-balance approach, average sustainable yield was estimated to be between 5.C.a Packet Pg. 170 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 21 of 40 11,416 AFY to 13,722 AFY. The similarity of the sustainable yield estimates developed by Slade and ICF using different modeling methods provide a strong level of confidence that the City can use local groundwater resources in an ongoing manner into the future without negatively impacting the basin or creating overdraft conditions. It should be noted that the estimates developed by Slade and ICF are conservative and do not include a sustainable yield estimate for the Crestal Sub-basin. In addition, all estimates of sustainable yield are transitory due to myriad associated climatic and hydrogeologic factors that are constantly in flux. The State legislature enacted the Sustainable Groundwater Management Act (Water Code sections 10720 et seq.)("SGMA"), which became effective on January 1, 2015. A portion of the 50-square mile Santa Monica Basin that underlies Santa Monica has been designated by the Department of Water Resources as a "medium-priority" groundwater basin. Any groundwater basin designated as medium-priority must be managed under a groundwater sustainability plan (“GSP”) adopted by a local groundwater sustainability agency and approved by the Department, by January 31, 2022. In light of SGMA, further analysis will be required to determine if future demand will exceed what could be sustainably pumped from the basin. If it is determined that the City’s plans to extract more groundwater is not supported in the approved draft of the GSP, then the City may be precluded from withdrawing groundwater in excess of the then-projected sustainable yield and the City would need to continue purchasing imported water from MWD to meet its potable water demand. The potential limitations on future groundwater withdrawals from the City’s active sub-basins indicate that the City’s approach of pursuing nonconventional resources, indirect potable reuse via aquifer recharge, additional water supply wells in the Coastal sub-basin, replacement of underperforming wells, increasing treatment efficiency at the Arcadia Water Treatment Plant, and continuing conservation efforts are necessary for the City to achieve and sustain its long-term objective of independence from imported water. Future updates of the SYA and numerical models will further refine the sustainable yield for the basin. Going forward, the City is planning to update the SYA approximately every two to three years. Future updates will include additional findings from work being conducted jointly with the US Geological Survey (USGS) and an ongoing climate stress test evaluation by the Rand Corporation. The 5.C.a Packet Pg. 171 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 22 of 40 City plans to produce groundwater within the upper limit of the estimated sustainable yield, while taking into consideration two irrigation pumpers in the Arcadia Sub-basin and one in the Crestal in addition to one diminutive residential irrigation well. Summary of Proposed Plan to Achieve Water Self-Sufficiency The three components proposed in the SWMP will help the City achieve water self- sufficiency by 2023 and eliminate the City’s reliance on imported water purchases from the MWD. The projected makeup of the City’s water supply portfolio is summarized in Figure 5, and contribution from each component to the City’s total water supply is provided in Table 4. The location for each of the three components is provided in Figure 6, and the synergy and inter-relationship between each component is illustrated in Figure 7. Achieving water self-sufficiency through a diversified water supply portfolio also provides the City with greater cost control over water rates as compared to the continued purchase of imported water from the MWD. As noted previously, approximately 1 percent of the water supply would continue to be made up of imported water purchased from the MWD as periodic circulation is required to maintain the supply line as an emergency backup for the City. 5.C.a Packet Pg. 172 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 23 of 40 New Local Groundwater 13% Imported Water (MWD) 1%Alternative Water Supply -Purified Water (Recharge) Alternative Water Supply - Recycled Water Alternative Water Supply - Production Efficiency Conservation 20% Local Groundwater 47% WATER SELF-SUFFICIENCY BY 2023 New Local Groundwater Imported Water (MWD) Alternative Water Supply - Purified Water (Recharge)Alternative Water Supply - Recycled Water Alternative Water Supply - Production Efficiency Conservation Local Groundwater Alternative Water Supply 19% Figure 5: A Sustainable and Drought Resilient Water Supply Portfolio Achieved through Self Sufficiency 5.C.a Packet Pg. 173 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 24 of 40 Table 4: Summary of Water Supply Contribution from Each Self-Sufficiency Component Water Self Sufficiency Component Estimated Water Supply Contribution by 2023 (AFY) % Reduction in Imported Water Estimated $/AFY Component 1 - Conservation Optimal Conservation Plan 3,100 38% $708 Component 2 – Alternative Water Supplies Recycled Water from SMURRF 560 7% $4201 Purified Water from SWIP to Recharge Olympic Sub-basin 1,100 13% $1,0171 Increase Production Efficiency at Arcadia WTP 1,200 15% $1,0711 Component 3 – New Local Groundwater Production Arcadia WTP Expansion and Resiliency Enhancement2 N/A N/A $7051 Olympic Sub-basin Restoration 2,100 26% N/A3 Subtotal 8,060 99% Existing Water Resources Existing Local Groundwater (2023 projected costs) 7,330 $1,100 Imported Water from MWD (to maintain for emergency use, 2023 projected costs) 170 $1,248 Subtotal 7,500 TOTAL WATER RESOURCES (2023) 15,560 1Estimated year 1 cost when project is complete and includes savings from avoided imported water purchase cost 2Aracadia WTP upgrades to accommodate increase in production efficiency and Olympic Sub-basin Restoration 3Olympic Sub-basin Restoration will be paid for through settlement funds 5.C.a Packet Pg. 174 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 25 of 40 •Olympic Sub-Basin Restoration •Recharge with SWIP •Production Efficiency and Capacity Expansion at Arcadia WTP •Separate Olympic Pipeline + New Treatment •CBI Tank •SWIP Well Acquisition to Enhance Resiliency Figure 6: Project Locations of Proposed SWMP Component Toward Self-Sufficiency 5.C.a Packet Pg. 175 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 26 of 40 Figure 7: Synergy between Proposed Water Supply Components to Achieve Self-Sufficiency SWMP Cost Summary and Implementation Schedule A cost summary for the proposed SWMP components to achieve self-sufficiency by 2023 is provided in Table 5. The funding required to complete the capital projects increasing local water supplies and enhance water supply resiliency is $38 million. A Five-Year Rate Study (2020-2024) is currently underway and will present funding solutions to cover these costs. It is projected that the components of the proposed SWMP may be funded primarily through the issuance of water revenue bonds (approximately $34.75 million), with the debt service on the bonds incorporated into water rates, and from a contribution from the Wastewater Fund (approximately $3.25 million). Staff will return to Council in spring 2019 for a rate study session. An additional $64 million from existing water-contamination settlement funds would be used for restoring the Olympic Sub-basin, which would allow additional water production from 5.C.a Packet Pg. 176 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 27 of 40 that sub-basin to support water self-sufficiency. The Olympic Sub-basin restoration cost includes an approximate, one-time $20 million capital expenditure for treatment systems and 30 years of ongoing operation and maintenance for an additional $20 million. Based on current modeling projections by ICF, over 80% of the Olympic Sub-basin will be remediated within the first 30 years; however, the Sub-basin may not be completely restored. Thus, the remaining balance in the settlement fund ($24 million) should be reserved to address any contamination that may still be present after 30 years or any new regulations that may impact use of the Olympic Sub-basin. A more detailed discussion on recommended budget appropriations is provided below. Table 5: SWMP Cost Summary for Proposed Components to Achieve Self-Sufficiency Unfunded Projects Additional Cost Arcadia WTP: Expand Capacity and Production Efficiency Enhancement $30M Additional Well and Improvements: Increase Resiliency and Ground Water Production $8M Olympic Sub-basin Restoration, Capital Improvements and 30 years of Operations and Maintenance $40M Olympic Sub-basin Restoration Reliability Reserve $24M Total: $102M Implementing the SWMP and reaching water self-sufficiency by 2023 entails numerous capital projects that are interrelated. An overview of the proposed implementation schedule is provided in Figure 8. Several well projects (SM-8, SM-9 and injection well) were approved by Council on July 11, 2017 and on June 12, 2018 and are on track to be completed by 2021 (Attachments E and F, respectively). A portion of the projects are in the City of Los Angeles and require installation of pipelines. Construction and permitting of pipelines in the City of Los Angeles will take time and was considered in the schedule. The design, construction, and permitting of improvements at the Arcadia WTP, including efficiency upgrades, are expected to be completed in 2023 if procurement starts in December 2018. A schedule contingency of approximately six months has been included to account for unforeseen conditions or new regulations that could impact the plan implementation. 5.C.a Packet Pg. 177 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 28 of 40 Figure 8: Proposed Implementation Schedule to Achieve Self-Sufficiency by 2023 Alternatives to Water Self-Sufficiency The proposed SWMP components summarized above are a considerable investment towards the City’s future resiliency and achieving water self-sufficiency by 2023. In consideration of the capital investment and impacts to water rates, staff has also evaluated potential alternatives to reduce capital expenditures to potentially provide relief to potential water rate increases (to be confirmed in the Five-Year Rate Study for 2020-2024). A summary of potential alternatives that may reduce upfront capital investment compared to the proposed water self-sufficiency plan is provided in Table 6. The capital cost summarized in Table 6 for each alternative is the capital cost that needs to be funded and does not include the $64 million in settlement funds that will be used for the Olympic Sub-basin restoration. For all alternatives, it is assumed that the Olympic Sub-basin restoration will be implemented. A brief description on which component is implemented and its associated capital cost to be funded is provided. Staff also considered delaying self-sufficiency goal to beyond 2023 and delaying capital expenditures to ease rate increase over the next five years. However, delaying implementation may result in increasing overall project cost due to inflation and negate 5.C.a Packet Pg. 178 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 29 of 40 any potential up front capital savings. The alternatives summarized in Table 6 only consider reduction in upfront capital cost and do not include projected increase of imported water purchase from MWD (estimated to be at 5% annual increase), which will ultimately be more expensive than locally produced water. Table 6: Summary of Alternatives Considered for Self-Sufficiency Alt. No. Alternatives Description Capital Cost3 Locally Sourced Water + Conservation Imported Water Purchase from MWD Staff Recommended Plan 99% water self- sufficiency1 Component 1 - Conservation Component 2 - Alternative Water Supplies Component 3 - New Local Groundwater $38M 11,730 AFY (Existing Arcadia WTP + Olympic) 3,100 AFY (Conservation) 560 AFY (Recycled Water)2 170 AFY 1 87% water self- sufficiency1 Implement only SWIP and Olympic Sub-Basin Restoration. Acquire new well to enhance resiliency at Arcadia WTP. No expansion and production efficiency enhancements at Arcadia WTP $8M 9,900 AFY (Existing Arcadia WTP + Olympic) 3,100 AFY (Conservation) 560 AFY (Recycled Water)2 2,000 AFY 2 90% water self- sufficiency1 Implement SWIP, Olympic restoration, and expansion at Arcadia WTP. No production efficiency enhancements at Arcadia WTP. Results in loss and negative impact to treatment resiliency. $21M 10,500 AFY (Existing Arcadia WTP + Olympic) 3,100 AFY (Conservation) 560 AFY (Recycled Water)2 1,400 AFY 3 94% water self- sufficiency1 Implement SWIP, Olympic Restoration, expansion $30M 10,900 AFY (Arcadia WTP + Olympic) 3,100 AFY 1,000 AFY 5.C.a Packet Pg. 179 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 30 of 40 and production efficiency upgrades at Arcadia WTP. Do not acquire a new well to enhance resiliency. (Conservation) 560 AFY (Recycled Water)2 1Percentages are based on year 2023 projected demand. 2560AFY of recycled water to be available in 2023, but actual usage of full capacity may not be until 2040. 3Excluding Olympic Sub-Basin restoration cost, which is funded through settlement funds and SWIP capital costs as it is already funded through a low interest loan from the State of California. The alternatives evaluated by staff are simply presented as scenarios to reduce capital expenditures over the next five years but does not provide a complete solution to achieve the City’s water self-sufficiency goal. Funding Recommendations to Achieve Water Self-Sufficiency A financial analysis for the plan outlined in this report to achieve water self-sufficiency was conducted by staff. The financial analysis includes comparing the future cost of imported water to the projected cost of locally produced water over a 30-year period. This analysis excluded the Olympic Sub-basin restoration costs, as the recommended funding source would be from groundwater settlement funds received by the City from outside sources to cover the costs for remediating the contaminants in that sub-basin. In summary, locally produced water from the recommended SWMP components outlined in this report is projected to cost between $400/AFY to $1,100/AFY, which is less than the expected cost to purchase imported water from the MWD at $1248/AFY in 2023. Please refer to Table 5, presented previously, for a detailed breakdown on the cost per acre-foot for each local water supply component. A comparison of the projected cost differential between the purchase of imported water from the MWD and production of locally produced water is provided in Table 7. With locally produced water cheaper than imported water costs, the components outlined in the SWMP to achieve water self- sufficiency by 2023 are a positive investment toward the future of the City. Ratepayers will benefit from the implementation of these projects, thus keeping local water costs low compared to the ongoing cost increases for imported water. Not only does the proposed SWMP provide a sustainable and drought resilient water supply for the City, it would also benefit the ratepayers with greater control over future water rates compared with 5.C.a Packet Pg. 180 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 31 of 40 imported water rates that are projected to increase at a higher rate and are outside the City’s control. Table 7: Future Estimated Imported Water Cost (increased at 5%) Compared to Projected Locally Produced Water Cost. Assuming Efficiency (CCRO) technology is installed and 2,800AFY is produced. As noted previously, staff recommends a combination of bonding and use of settlement funds to fund the capital projects supporting water self-sufficiency and the Olympic Sub- basin restoration. Water Revenue Bond: A rate study is currently being conducted through October 2019 to set water and wastewater rates for calendar years 2020 to 2024. The rate study will address options to support the costs of this plan. A possible funding solution, to be confirmed in the rate study, is the issuing of a 30-year water revenue bond totaling approximately $34.75 million to increase local water supplies and enhance resiliency as outlined in the SWMP. The remaining $3.25 million would be contributed from the Wastewater Fund due to joint property use. The $34.75 million in bonds would cover new well acquisition, treatment capacity expansion and implementation of new 5.C.a Packet Pg. 181 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 32 of 40 technologies to enhance production efficiency at the Arcadia WTP, and other supporting infrastructure upgrades. The Water Fund would need to cover an annual payment of approximately $2.2 million over the next 30 years to fund the projects outlined in the SWMP. Assuming a bond is issued, Figure 9 illustrates projected annual savings from avoiding imported water purchases and estimated annual bond repayments. In year 2036, where the two lines cross, the City will start saving money for rate payers on an annual basis. This analysis assumes imported water cost from MWD will increase at an annual rate of 5%. The total money borrowed is estimated to be offset by cumulative savings in the year 2048. Figure 9: City’s Projected Annual Savings due to Local Water Production in lieu of Import Water Purchases, compared to the Payments (debt service) for a 30 Year Bond. Settlement Funds Usage - The current balance of Gillette/Boeing funds available to program is $64.1 million. This balance includes $11.1 million transferred and currently 5.C.a Packet Pg. 182 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 33 of 40 available in the Water Fund as authorized by Council on January 9, 2018 and $53.0 million in the General Fund. Staff recommends transferring $53.0 million from the General Fund to the Water Fund to be used to restore the Olympic Sub-basin. Additionally, to satisfy the settlement agreement, Boeing still owes the City three payments totaling $11.0 million. Staff recommends depositing these funds directly into the Water Fund. Approximately $20 million would be used to construct a new treatment facility to remove the contaminants currently present in the sub-basin and $20 million would be reserved for operation and maintenance costs of the treatment facility related to restoration of the Olympic Sub-basin over a 30-year period. Due to uncertainty with the Olympic Sub- basin restoration after 30 years, staff recommends setting aside the remaining $24 million of Gillette/Boeing funds as a reliability reserve. The remaining $11.0 million that has been previously transferred to the Water Fund, is currently being used for groundwater modeling, monitoring, and reporting in support of Olympic Sub-basin remediation. With the proposed injection of advanced purified water from the SWIP into the Olympic Sub-basin, staff will revisit this timeframe and report back to Council in the future once recharge operation begins. Grants - Staff will identify and apply for state and/or federal grants to help offset the $38 million capital investment and return to Council in early 2019 with resolutions required for grant applications if available for the proposed projects. Staff has engaged a grant consultant to assist in the process. Grants being considered are: MWD, Local Resources Program California Department of Water Resources, Water Quality, Supply, and Infrastructure Improvement Act of 2014 (Proposition 1). Previously Authorized Water Rate Increase 5.C.a Packet Pg. 183 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 34 of 40 On February 24, 2015, the City Council adopted Resolution Number 10867 (CCS) to authorize water rate increases over a five-year period, beginning March 1, 2015. The five-year water increase schedule was adopted after Council’s consideration of a rate study conducted by Kennedy Jenks Consultants. Resolution Number 10867 (CCS) also contained a provision, giving Council flexibility to approve a suspension of each annual increase, in whole or part, beginning with the 9% scheduled increase for January 1, 2016. This resolution was adopted without a majority protest, following a noticed public hearing in accordance with Proposition 218. Since adoption of this resolution, Council has partially suspended the full increases authorized for 2016-2018, and instead approved 5% increases for each of those years due to: Actual water sales revenues exceeded expectations during 2015 to 2017. Actual operating and capital expenditures lower than expected. Resulting savings were applied to conservation programs, water main replacements and partially suspending planned 9% annual rate increases to more modest 5% increases. State of the Water Fund and Forthcoming 2019 Rate Adjustment Justification Staff will return to Council on January 8, 2019 for a public hearing and to obtain authorization for the full 9% water rate increase previously approved by Council on February 24, 2015 for calendar year 2019. If approved this would result in a monthly increase of $4.33 to average single-family customer. This is the final year of a five-year rate adjustment cycle approved via resolution as mentioned above. A summary of rate increases from 2015 is provided in Table 8. Table 8: Rate Increase History Calendar Year 2015 2016 2017 2018 2019 Effective Date March 1, 2015 January 1, 2016 January 1, 2017 January 1, 2018 January 1, 2019 Maximum Authorized Increase 9% 9% 9% 9% 9% 5.C.a Packet Pg. 184 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 35 of 40 Actual Increase* 9% 5% 5% 5% 9%** Date Actual Increase Authorized February 24, 2015 February 23, 2016 November 22, 2016 January 9, 2018 **public hearing on January 8, 2019 The full implementation of the 9% previously authorized adjustment would be sufficient to allow the City to: A) Deliver potable water to Santa Monica customers reliably, safely and sustainably in compliance with federal and state regulations. B) Fund operating and capital budgets that are necessary to implement the City's self-sufficiency goals to encourage water conservation and sustainability, as contemplated in the City's 2014 water rate analysis. C) Continue to implement infrastructure improvements associated with replacing aging existing infrastructure facilities comprised of water mainlines that are approaching the end of their useful lives. The 9% rate increase would provide sufficient funding to complete the following capital projects as contemplated in the City's 2014 water rate analysis and to continue progress toward the City’s water self-sufficiency goal: 1. Additional capacity improvements, which include Preliminary Design for the Arcadia Treatment Capacity Expansion and Enhancement Project - $3.18 million in FY 2018-19. As noted in the prior section, the design would upgrade pumps, blowers, cartridge filters, and other equipment at the treatment plant to accommodate increased groundwater production and new technologies. The design would also incorporate a new process (CCRO) to increase overall plant efficiency to 90% or greater (as discussed previously under component 2 - alternative water supplies. 2. New Groundwater Resiliency Well - $6,825,000 in FY 2018-19 for acquisition of a new groundwater well to enhance resiliency. Also limit future exposure to imported water. 3. Water Main Replacement Cost Escalation - an increase of $2,000,000 starting in FY 19-20. The rate increase is necessary to fund the sharp increase observed in 5.C.a Packet Pg. 185 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 36 of 40 water main replacement construction costs. Water main contract awards in 2017 and 2018 have returned bids of $600 to $700 per linear foot in the current high- cost construction environment. These costs have increased from a prior $400 per linear foot estimate. The budget was established at $4 million per year. However, staff is now estimating a need of $6 million per year to implement the recommended 100-year water main replacement cycle (2 miles replaced per year for the City’s 205-mile water main system. Maintaining a $4 million per year budget would only yield replacement of 1.1 to 1.25 miles of pipeline per year, thus increasing the replacement cycle from 100 years to approximately 160 to 190 years. Staff recommends staying on a 100-year replacement cycle to maintain operational reliably. Council approval of the full 9% rate increase would also help fund the following ongoing operational expenditures: 1) Metropolitan Water District (MWD) of Southern California - $5 million per year from FY 2020-21 to FY 2022-23 (additional $8.7 million) to ensure sufficient funding for imported water deliveries prior to achieving water self-sufficiency. 2) City Yards Master Plan - Required contribution from the Water Fund for upgrades to City Yards - $4 million modeled, actual costs to be determined. As noted above, staff will return to Council on January 8, 2019 with a recommendation that Council adopt the full 9% rate increase for calendar year 2019 as previously authorized in 2015. The staff report will include a detailed justification for the 9% rate increase as well as a 10-year fund forecast, cost comparison with other water agencies and an analysis of impacts to ratepayers. Funding Summary Table 9 provides a summary of funding recommendations to implement the SWMP. As noted above, staff also recommends that Council approve funding for three Capital Improvement Program (CIP) projects, which would commence in FY 2018-19: 5.C.a Packet Pg. 186 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 37 of 40 Arcadia Capacity Expansion and Enhancement Project, Preliminary Design ($3,180,000) New Groundwater Resiliency Well ($6,825,000) Olympic Wellfield Restoration Design ($1,800,000). Table 9: Funding Summary Settlement Funds Available for current remediation and O&M for next 30 years Settlement Funds Available for Future Reserve (Olympic sub- basin Restoration) Water Bond Amount (pending ongoing rate study) Est. Annual Bond Payment (30 yrs): $40 million $24 million $34.75 million $2.2 million Task Force on the Environment and Water Advisory Committee Actions Findings of the Sustainable Yield Analysis, Sustainable Water Master Plan Update and proposed projects, cost and schedules were presented to the Task Force on the Environment on March 19, June 18, and October 15 and to the Task Force on the Environment Water Subcommittee on November 19, 2018. Similar updates were presented to the Water Advisory Committee on March 5, May 7, June 4, September 5 and November 5, 2018. Rate Adjustment recommendations were presented to the Water Advisory Committee on November 5, 2018 and at a Task Force on the Environment Water Subcommittee on November 19, 2018. The Water Subcommittee strongly supports the Sustainable Water Master Plan Update and staff’s recommendations. Financial Impacts and Budget Actions Approval of the recommended action requires the following: 1. Appropriations to the FY 2018-19 Capital Improvement Program in the Water Fund: 5.C.a Packet Pg. 187 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 38 of 40 Account Number Amount C5007740.689000 - Arcadia Capacity Expansion and Enhancement Project, Preliminary Design $3,180,000 C5007750.689000 - Olympic Wellfield Restoration Design $1,800,000 C5007760.689000 - New Groundwater Resiliency Well $3,575,000 Total $8,555,000 2. An appropriation to the FY 2018-19 Capital Improvement Program in the Wastewater Fund C5107760.689000 - New Groundwater Resiliency Well, Property Joint Use. $3,250,000 Total $3,250,000 3. $53 million cash transfer of Gillette/Boeing settlement funds from the General Fund to the Water Fund and the corresponding release of the remaining fund balance in General Fund account 1.380237. The cash will be recorded in an interest earning restricted cash account in the Water Fund, Olympic Wellfield Remediation account 50.102442. 4. Transfer of two remediation capital projects, appropriated in previous fiscal years and funded with Gillette/Boeing funds, from the General Fund to the Water Fund to consolidate all budgeted Olympic restoration projects in the Water Fund. General Fund Account Number Proposed Water Fund Account Amount C019045.589000 Olympic Sub-basin Remediation C5005880.689000 $1,909,732 C019067.589000 Olympic Sub-basin Well Hydrology C5006050.689000 $1,946,407 5. The following budget items related to Gillette/Boeing water mediation settlement funds were previously taken by Council: 5.C.a Packet Pg. 188 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 39 of 40 On January 9, 2018, Council authorized staff to make an $11,100,000 transfer of Gillette/Boeing settlement funds from the General Fund to the Water Fund for ongoing and future remediation costs associated with polluted groundwater in the Olympic Wellfield (Attachment B). Staff transferred these funds to account 25695.570080 in FY 2017-18. On June 12, 2018, Council approved a FY 2018-19 transfer of $2,300,000 of Gillette/Boeing water mediation settlement funds from the General Fund to the Water Fund (Attachment F). This transfer was to fund the projects for the Olympic Wellfield remediation appropriated in the FY 2018-19 Capital Improvement Program. Account Number Amount C5007460.689410 City / USGS Monitoring Well & Numerical Flow Model $1,800,000 C5007260.689410 Redrill Santa Monica Well #3 $500,000 Total $2,300,000 6. Future Gillette/Boeing settlement funds are to be deposited in the Water Fund, and a corresponding receivable shall be established. The liability associated with current and future pollution remediation utilizing Gillette/Boeing funds will be recorded in the Water Fund. Prepared By: Alex Nazarchuk, Interim Water Resources Manager Approved Forwarded to Council Attachments: A. October 28, 2014 Staff Report (Web Link) B. January 9, 2018 Staff Report C. Summary of Water Self-Sufficiency Scenarios to Expand Groundwater Production 5.C.a Packet Pg. 189 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water 40 of 40 D. Updated Preliminary Sustainable Yield Analysis E. July 11, 2017 Staff Report (Web Link) F. June 12, 2018 Staff Report (Web Link) 5.C.a Packet Pg. 190 Attachment: Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (5243 : Award RFP SP#2666 for the Design of Water City Council Report City Council Meeting: September 26, 2017 Agenda Item: 8.A 1 of 9 To: Mayor and City Council From: Susan Cline, Director, Public Works, Water Resources Subject: Approval of Sanitary Sewer System Master Plan Recommended Action Staff recommends that the City Council approve the 2017 Sanitary Sewer System Master Plan. Executive Summary The 2017 Sanitary Sewer System Master Plan (SSSMP) (Attachment A) provides the City with a tool for planning sanitary sewer collection system infrastructure improvements. The primary purpose of this Master Plan is to evaluate the capacity of the City’s existing sanitary sewer system under current conditions and plan for the capacity required by future conditions associated with anticipated development projects, including the Land Use and Circulation Element (LUCE) and the Downtown Community Plan (DCP). In order to analyze the impacts of existing and future sewer flows, a numerical hydraulic model was developed. The analysis found that the City’s sewer system performs well under both existing and future conditions. Existing conditions show a 1% shortfall in sewer flow capacity citywide, and under future build out conditions, only 3% of the modeled pipelines exhibited a capacity deficiency. The ability of the sewer collection system to meet future conditions with only modest investments in sewer upgrades paid for by development fees means these improvements can be incorporated into the City’s existing $3 million per year sewer main replacement Capital Improvement Program forecast, as presented below. Description FY 2018/19 FY 2019/20 FY 2020/21 FY 2021/22 FY2022/23 Capacity Improvements $2,000,000 $1,200,000 $1,600,000 $2,000,000 Field Review Services $100,000 $80,000 Pipeline Replacements $900,000 $1,800,000 $1,400,000 $2,920,000 $1,000,000 5.C.b Packet Pg. 191 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 2 of 9 TOTAL ANNUAL CIP $3,000,000 $3,000,000 $3,000,000 $3,000,000 $3,000,000 Background Santa Monica’s wastewater system includes a collection system including gravity sewers, force mains, monitoring stations and a lift station to help convey sewage to the City of Los Angeles’ Hyperion Water Reclamation Plant in El Segundo for treatment and disposal. The City’s sanitary sewer facilities include approximately 152 miles of pipelines, 2,800 maintenance holes, two permanent flow monitoring and sampling stations, and one 26-million-gallons-per-day (MGD) pumping station, referred to as the Moss Avenue Pump Station (MAPS), located at 1623 Appian Way. The City’s sanitary sewer system is shown in Figure 1. Prior studies included the development of a limited model assessing the capacity of the trunk sewer used to discharge brine (the wastewater produced as a by-product of potable water treatment process) from the City’s water treatment plant into the sewer system at 19th and Broadway (2011), and a Sewer System Management Plan (2012) which addressed sewer system organization and management, operations and maintenance, overflow response plans, and water quality monitoring programs. The last comprehensive Sewer Master Plan for the system was conducted in 1992. The findings and recommendations of the 1992 Master Plan were mostly not implemented, however, as the 1994 Northridge Earthquake caused considerable damage to the sewer system, after which approximately 80% of the system was rebuilt and rehabilitated. Discussion This 2017 Sanitary Sewer System Master Plan (SSSMP) was prepared to reflect current conditions in the City and anticipated future developments coincident with the LUCE and DCP planning horizons of year 2030, and to provide the City with a tool for planning improvements needed for sanitary sewer collection system infrastructure. The Downtown Community Plan EIR includes mitigation measure MM U-4 which states: “In addition to the improvements to the water delivery system described in the MM U-1, the City shall ensure adequate financing for funding of infrastructure improvements to the wastewater system. The DPIFP described in MM U-1 shall determine the costs of and establish a funding program for the following capital improvements to wastewater 5.C.b Packet Pg. 192 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 3 of 9 conveyance as needed to serve the demands of new projects occurring under the Downtown Community Plan.” The primary purpose of this planning document is to evaluate the capacity of the City’s sanitary sewer system under current conditions and plan for any necessary improvements in capacity to accommodate anticipated new development in the City. These improvements would be implemented within the City’s Capital Improvement Program (CIP). To fully assess existing conditions in the sewer collection system and plan for the future capacity needs of the sanitary sewer system, future flow estimates incorporate the changes in sanitary flows that would be generated by anticipated development and the additional water that enters the sewer system from storm-related events. The additional sanitary sewer flows associated with these development projects are derived by applying the applicable sewer discharge factors for the land use types and densities of each planned development project. Future development projects and their status in the development process are depicted graphically on Figure 2. Based on these factors, future average dry weather flows are projected to increase from 14.4 million to 16.5 million gallons per day (MGD), an increase of approximately 14 percent. About half of this increase is projected to occur in the downtown area. 5.C.b Packet Pg. 193 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 4 of 9 Figure 1 Figure 2 5.C.b Packet Pg. 194 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 5 of 9 Recent and near-term actions planned by the City continue to support the City’s 5.C.b Packet Pg. 195 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 6 of 9 sustainability goals and minimize the projected increase of sewage generation related to new development in the City. Foremost among these programs is the recently adopted Water Neutrality Ordinance and the programmatic efforts of the Sustainable Water Infrastructure Project (SWIP). Each of these programs will help in reducing the projected overall increase in sewer flows and are summarized below. Water Neutrality In May 2017, the Santa Monica City Council adopted a Water Neutrality Ordinance to require that new development offset water use on site or off site, or alternately, pay the City an in-lieu fee to fund retrofitting of plumbing fixtures offsite. The ordinance would prohibit a new development from exceeding the water use of the existing development on that property. If that requirement could not be met onsite, the excess water demand would have to be offset by reducing the water demand (through fixture replacement) at other sites within the City. Given this water neutrality requirement, much if not all of the projected overall increase in future sewage flow should be offset through this growth- funded plumbing fixture retrofit program. It should be noted that while this water neutrality program may offset an increase in overall sewage flows, Water Neutrality may still allow for an increase in flows at any specific site. With this program provision, some of the large future developments could still have a substantial point load increase in sewage discharges. To plan for this potential increase associated with these developments and to assure adequate capacity in the sanitary sewer system collection system network, the impact of site specific increases has been incorporated in the hydraulic model. Proceeding in this manner, the assessment included some anticipated impact from new development to reduce the risk of sanitary sewer overflows. SWIP – Water Reclamation Facility (WRF) The City of Santa Monica Sustainable Water Infrastructure Project (SWIP) will provide for the treatment and reuse of brackish/saline impaired groundwater, recycled municipal wastewater and stormwater runoff. In addition, the SWIP will help improve the water quality in the Santa Monica Bay by reducing urban runoff into the Bay. 5.C.b Packet Pg. 196 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 7 of 9 The Water Reclamation Facility (WRF) component of the SWIP will have the greatest benefit to the City’s sanitary sewer system. The WRF will remove 1 MGD of sewage from the sewer collection system in the area. This will provide additional pipeline capacity and reduce the cost of wastewater treatment and disposal currently charged by the City of Los Angeles. Assessment Modeling To support the evaluation of the City’s sanitary sewer system for both existing and future conditions, a hydraulic model was developed. The hydraulic model development activities included a comprehensive review of system data including Geographic Information System (GIS) mapping, Supervisory Control And Data Acquisition (SCADA), NorthStar billing system statistics, sewer flow analysis and allocation, elevation extraction for the model facilities based on survey data, diurnal (daytime/nighttime) pattern assignments, analysis of dry and wet weather peaking factors and model calibration based on flow monitoring data. The calibrated sanitary sewer system hydraulic model was used to perform a comprehensive capacity analysis of the sewer system under current and future conditions. These modeling simulations determined the adequacy of the system capacity under dry weather and wet weather conditions, and subsequently identified parts of the systems where improvements will be required for anticipated development. Findings The analysis found that the City’s sanitary sewer system performs exceedingly well, and there are very limited areas where the hydraulic capacity of the existing sewer system may fall short of the applicable evaluation criteria. These evaluation criteria comprise two factors used in sewer flow analysis in pipelines:  depth of flow equal to or less than half of the pipe diameter; and  average flow velocity equal to or greater than 2 feet per second. For maintenance hole performance, surcharge relates to the depth of wastewater in the 5.C.b Packet Pg. 197 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 8 of 9 maintenance hole relative to the street elevation in the event of a sewage backup. Under existing conditions, approximately 1% of the system may experience a capacity shortfall. In utilizing the model to simulate future conditions, the City’s sewer system continues to perform well. In fact, under future conditions, only 3% of the modeled pipelines exceeded the evaluation depth of flow criteria (depth of flow greater than half of the pipe diameter). Although 1% existing and 3% future capacity shortfall results represent a favorable outcome of this analysis, any Sanitary Sewer Overflow which occurs can become an environmental hazard to the coastal environment. By addressing problem areas proactively, spills may be prevented and hazards avoided. The condition of the existing system and its ability to address future conditions with relatively modest investment lead to a proposed 5-year Capital Improvement Program. The annual expenditures in the proposed CIP coincide with historical $3 million per year sewer main replacement budgets. In addressing needed improvements in the immediate five-year planning horizon, capacity to serve future conditions will be in place in advance of the build-out of the DCP/LUCE. The proposed five-year CIP schedule is provided below. Description FY 2018/19 FY 2019/20 FY 2020/21 FY 2021/22 FY2022/23 Capacity Improvements $2,000,000 $1,200,000 $1,600,000 $2,000,000 Field Review Services $100,000 $80,000 Pipeline Replacements $900,000 $1,800,000 $1,400,000 $2,920,000 $1,000,000 TOTAL ANNUAL CIP $3,000,000 $3,000,000 $3,000,000 $3,000,000 $3,000,000 Capacity improvements are those projects identified in the SSSMP, which were found through the hydraulic modeling to be in need of replacement due to insufficient capacity to meet existing and/or future conditions. Field review services include projects or activities that are needed to further refine the sewer system hydraulic model from additional field investigations, in the form of facility information validation or flow verification, to confirm pipeline and maintenance hole data and obtain new information on actual sewer flow conditions in various areas of the City. The results of this effort may enable the City to reduce the identified capacity-related 5.C.b Packet Pg. 198 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) 9 of 9 improvements provided herein. Pipeline replacements include those pipelines identified through ongoing maintenance activities (e.g., sewer jetting and video inspections) for the annual sewer main replacement program. Financial Impacts and Budget Actions There is no immediate financial impact or budget action necessary as a result of the recommended action. Projects identified in the plan will be incorporated into future Capital Improvement Program budgets. Prepared By: Gil Borboa, Water Resources Manager Approved Forwarded to Council Attachments: A. Sanitary Sewer System Master Plan - Draft - August 2017 B. Powerpoint Presentation 5.C.b Packet Pg. 199 Attachment: Sanitary Sewer System Master Plan (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) CITY OF SANTA MONICA OAKS INITIATIVE NOTICE NOTICE TO APPLICANTS, BIDDERS, PROPOSERS AND OTHERS SEEKING DISCRETIONARY PERMITS, CONTRACTS, OR OTHER BENEFITS FROM THE CITY OF SANTA MONICA Santa Monica’s voters adopted a City Charter amendment commonly known as the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and information about the Initiative’s requirements. You mayobtain a full copy of the Initiative’s text from the City Clerk. This information is required by City Charter Article XXII—Taxpayer Protection. It prohibits a public official from receiving, and a person or entity from conferring, specified personal benefits or campaign advantages from a person or entity after the official votes, or otherwise takes official action, to award a “public benefit” to that person or entity. The prohibition applies within and outside of the geographical boundaries of Santa Monica. All persons or entities applying or receiving public benefits from the City of Santa Monica shall provide the names of trustees, directors, partners, and officers, and names of persons with more than a 10% equity, participation or revenue interest. An exception exists for persons serving in those capacities as volunteers, without compensation, for organizations exempt from income taxes under Section 501(c)(3), (4), or (6), of the Internal Revenue Code. However, this exception does not apply if the organization is a political committee or controls political committees. Examples of a “public benefit” include public contracts to provide goods or services worth more than $25,000 or a land use approval worth more than $25,000 over a 12-month period. In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity. Therefore, if you are seeking a “public benefit” covered by the Oaks Initiative, you must supply that information on the Oaks Initiative Disclosure Form. This information must be updated and supplied every 12 months. 5.C.c Packet Pg. 200 Attachment: OaksInitiative-wEx _DRP (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project) CITY OF SANTA MONICA OAKS INITIATIVE DISCLOSURE FORM In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity. Public benefits include: 1. Personal services contracts in excess of $25,000 over any 12-month period; 2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12- month period; 3. Purchase, sale or lease of real property to or from the City in excess of $25,000 over a 12- month period; 4. Non-competitive franchise awards with gross revenue of $50,000 or more in any 12-month period; 5. Land use variance, special use permit, or other exception to an established land use plan, where the decision has a value in excess of $25,000; 6. Tax “abatement, exception, or benefit” of a value in excess of $5,000 in any 12- month period; or 7. Payment of “cash or specie” of a net value to the recipient of $10,000 in any 12- month period. Name(s) of persons or entities receiving public benefit: Name(s) of trustees, directors, partners, and officers: Name(s) of persons with more than a 10% equity, participation, or revenue interest: Prepared by: ____________________________Title: __________________________ Signature: ______________________________________ Date: ________________ Email: ____________________________________ Phone: ____________________ FOR CITY USE ONLY: Bid/PO/Contract # ____________________________ Permit # ___________________________ _______________________________________________________________________________________Saik-Choon Poh President 10/25/2022 scpoh@drpwater.com 213.407.4467 DRP Engineering, Inc. Saik-Choon Poh, Curtis Roth Saik-Choon Poh, Curtis Roth 5.C.c Packet Pg. 201 Attachment: OaksInitiative-wEx _DRP (5243 : Award RFP SP#2666 for the Design of Water and Wastewater Replacement Project)