2000 AGN MAR 21 I26 - Laserfiche WebLink

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CITY OF COLTON CITY COUNCIL AGENDA REPORT For City Council Meeting of March 21, 2000 TO: Honorable Mayor and City Council Members FROM: Thomas K. Ciarke, Utility Dire or �� APROVAI: Henry T. Garcia, City Manage SUBJECT: Recommendation to City Councii for Approval of an Emergency Change Order to Americon Constructors for a 2 MGD Capacity Increase at the Wastewater Treatment Facitity, as well as Direction to Staff to Prepare Necessary Documents for the Sale of Wastewater Revenue Bonds for Proceeds of Approximately $3.5 Million and Approval of a Sewer Rate Change Suffcient to Cover Operations and Debt Obligation DATE: March 9, 2000 As a resuit of the DepartmenPs efforts to comply with a 1995 Cease and Desist Order issued by the Regionai Water Quality Control Board, a rate increase was approved that went into effect in July, 1998. At the time of that approval, the financial plan indicated a second rate increase wouid be needed in FY2000- 2001. That second increase was projected in the 20 percent range. The two-phased increase was implemented so that adjustments could be made in the financial plan and to lessen any rate shock. The sum of the two increases was necessitated by Wastewater Treatment Plant expansion to provide reliab�e capacity as prescribed by the Order. The expansion was designed to add 2 million gallons per day (MGD) in treatment capaciry and was funded through the State's Revolving Fund Program. The loan repayment amount, interest rate and payment schedule will not be set until the work is completed, but is anticipated to amount to approximately $8 million. It is anticipated that the first payment will be due one year following the completion date. Part of the process in the expansion and the Order was to perform restoration and rehabilitation work on Unit 1 at the plant, if possible. This unit was built in 1949 and has operated almost continually since startup. IYs life expectancxfor this type�facility,is only 40 years. The Citys consulting engineers inspected the unit as part of their contract to determine the extent of the possibie restoration work. Their conclusion was that the unit was deteriorated beyond their expectations. They have recommended that the unit be taken out of service and replaced by new facilities, since it is realistic to expect that the unit could fail at any time. DISCUSSION / ANALYSIS The total existing plant capacity is 6.4 MGD. The target established by the Order was S.0 MGD. After considerable review of the various alternatives for sewage treatment, the City chose two traditionai oxidation ditches each providing 1 MGD of treatment capacity. This would bring the total plant capacity to 8.4 MGD. This level would satisfy the Regional Board and permit the City to grow until the next increment needed to be added. This was not anticipated until buildout sometime around 2025. However, much of Item #26