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Home My WebLink AboutReso 2004-276 RESOLUTION NO. 2004-276 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHULA VISTA ACCEPTING THE ENGINEER'S REPORT UPDATING THE SALT CREEK SEWER BASIN DEVELOPMENT IMPACT FEE WHEREAS, in 1994, Wilson Engineering prepared the Salt Creek Basin Gravity Analysis that evaluated the Salt Creek Sewer Basin ("1994 Wilson Study"). Using only available sewer studies and maps, the engineering study recommended the construction of approximately 12.5 miles of sewer line to convey flows from the upstream portions of the Salt Creek Sewer Basin to the existing 72-inch Metro Sewer Line along the coast. This 12.5-mile project was named the Salt Creek Gravity Sewer Interceptor; and WHEREAS, the Salt Creek Sewer Basin Development Impact Fee was established on December 6, 1994 by Ordinance 2617 to facilitate the construction of the Salt Creek Gravity Sewer Interceptor, which is primarily needed to provide sewer service to properties within the Salt Creek Sewer Basin; and WHEREAS, since the Salt Creek Sewer Basin Development Impact Fee inception, it has never been updated to reflect new land-use approvals, a more accurate engineering study and design of the required sewer infrastructure and updated costs estimates; and WHEREAS, City staff prepared in August 2004, the "Update to the Salt Creek Sewer Basin" ("2004 DIF Update"), which purpose is to: (1) Revise the construction cost of the Salt Creek Gravity Sewer Interceptor; (2) Include the construction cost of the Wolf Canyon Trunk Sewer as a Salt Creek Development Impact Fee (DIF) facility; (3) Reflect the final design of the Salt Creek Gravity Sewer Interceptor; (4) Reflect the significant difference in the level of staff and consultant resources employed in the project; (5) Reflect the significant increase in the environmental mitigation costs and other associated costs; and WHEREAS, the 2004 DIF Update shows in detail the cost estimates for the Salt Creek Gravity Sewer Interceptor and the Wolf Canyon Trunk Sewer and updates the number of Equivalent Dwelling Units (EDU's) within the Salt Creek and Wolf Canyon Sewer Basins; and WHEREAS, the 2004 DIF Update recommends Ordinance No. 2617 be amended to: (1) Add the Wolf Canyon Trunk Sewer and Reach 9A as additional facilities financed by the Salt Creek Sewer Basin DIF, and (2) Adjust the DIF by amending the Master Fee Schedule to reflect the new rate. NOW, THEREFORE, BE IT RESOLVED, the City Council of the City of Chula Vista does hereby accept a report prepared by City staff recommending the addition of the Wolf Canyon Trunk Sewer to the list of facilities tb be financed by the DIF and the recommendation to adjust the fee. A copy of the 2004 DIF update is attached as Exhibit A. Resolution 2004-276 Page 2 Presented by Approved as to form by G~ Ann Moore City Attorney PASSED, APPROVED, and ADOPTED by the City Council of the City of Chula Vista, California, this 17th day of August, 2004, by the following vote: AYES: Councilmembers: Davis, McCann, Rindone, Salas and Padilla NAYS: Councilmembers: None ABSENT: Councilmembers: None /SJ~~{¿?~/ - ATTEST: - ~ J á......-I-:;;;;:::i, ~ 4 ~ Susan Bigelow, MMC, City lerk STATE OF CALIFORNIA ) COUNTY OF SAN DIEGO ) CITY OF CHULA VISTA ) I, Susan Bigelow, City Clerk of Chula Vista, California, do hereby certify that the foregoing Resolution No. 2004-276 was duly passed, approved, and adopted by the City Council at a regular meeting of the Chula Vista City Council held on the 17th day of August, 2004. Executed this 17th day of August, 2004. - ~.uð-L- ~c!fe:~ Susan Bigelow, MMC, City erk CITY OF CHULA VISTA ENGINEERING DIVISION WASTEWATER ENGINEERING ~{~ ~ r -.._ .-._ -._ ___-- ~ ---- -.- ---- - --- ---- eflY OF CHUlA VISTA eXHIBIT A UPDATE TO THE SALT CREEK SEWER BASIN PLAN August 2004 (08/02/2004) CITY OF CHULA VISTA ENGINEERING DEPARTMENT WASTEWATER ENGINEERING UPDATE TO THE SALT CREEK SEWER BASIN PLAN Prepared By: Sandra Hernandez, Assistant Engineer Mario J Ingrasci, Assistant Civil Engineer Reviewed by: Anthony Chukwudolue, Civil Engineer Frank X. Rivera, Deputy City Engineer Update to the Salt Creek Sewer Basin Plan August 2004 11 TABLE OF CONTENTS 1.0 Executive S=ary ......... ............... ............ ... ... .... ......... ... ... ... 1 2.0 Project Description.................................................................. 5 3.0 Project Cost Justification............................................................... 14 4.0 Salt Creek Sewer Basin DIF Analysis ...... ...................... ........... ......... .18 5.0 Financial Analysis ......................................................................................... 22 6.0 Conclusions and Recommendations .................. ......... .................. 24 Appendices Update to the Salt Creek Sewer Basin Plan August 2004 111 LIST OF FIGURES Project Location ... ...... ... ........... .................. ..... ........ .... ........ ......... Exhibit A Cost of the Existing Reaches Constructed by Pacific Bay Homes, Eastlake Co., and SDG&E. ... ...... ............. ........ .... Table 2.1 Final Cost Estimate for Reaches 3 through 9........... ..... ........ .......... ..... ....... Table 2.2 Updated Cost Estimate for the Wolf Canyon Trunk Sewer......... ............ .., Table 2.3 List of Facilities ............ ............................................................... Table 2.4 Overall Cost Increases - 1994 - 2004....................... ...... .................... Table 3.1 Location of Wolf Canyon Sewer Facilities.......................................... Exhibit C Absorption Projections For Salt Creek and Wolf Canyon Sewer Basins........... Table 4.1 Revenues Collected by the Salt Creek Sewer Basin DIF. .......................... Table 4.2 Future Cost of Money (Interest Determination)..... .................................. Table 4.3 Determination of Sewer DIF............................................................ Table 4.4 EDU Conversion Factors for Financial Analysis. ........... ... ............ ......... Table 5.1 Project Funding S=ary..... ....... ... ............ .................. .......... ........ Table 5.2 Master Land-Use Inventory ................................................................................ Exhibit B Update to the Sail Creek Sewer Basin PIan August 2004 IV APPENDICES Appendix A Salt Creek Basin Gravity Sewer Analysis by Wilson Engineering, November 1994. Appendix B Ordinance No. 2617, Establishing the Salt Creek Sewer Basin Development Impact Fee. Appendix C Summary of Wolf Canyon Trunk Sewer Costs Appendix D EastLake's Construction Costs for Reaches 2A & 2B. Appendix E SDG&E's Construction Costs for Reaches 4B & SA. Appendix F Pacific Bay Homes' Construction Costs for Reaches 1. Appendix G Final Construction Estimate for the Salt Creek Gravity Sewer Interceptor. Appendix H Bid Results for the Salt Creek Gravity Sewer Interceptor. Appendix I EDUs for Salt Creek Sewer Basin and Wolf Canyon Sewer Basin. Appendix J Master Land-Use Inventory Table. Update to the SaIt Creek Sewer Basin Plan August 2004 v 1.0 Executive Summary Purpose of the Report The purpose of this report is to update the Development Impact Fee (DIF) established in 1994 by Ordinance No. 2617 to finance the sewer improvements within the Salt Creek Sewer Basin. This report will show in detail the revised costs for the facilities to be financed in the Salt Creek Gravity Basin DIF (i.e. the Sewer Creek Gravity Sewer Interceptor and the Wolf Canyon Trunk Sewer). Furthermore, the report shows an update of the number of equivalent dwelling units (EDUs) within the Salt Creek Sewer Basin and Wolf Canyon Sewer .Basin and the analysis, which will form the basis of staff's recommendation for the revision of the DIF. The Update of the DIF is necessary for the following reasons: · To reflect the final construction cost of the Salt Creek Sewer. · To revise the list offacilities to be financed by the DIF to include Reach 9A and the Wolf Canyon Trunk Sewer Facilities (Rock MOW1tain Road and Heritage Road). · To provide a detailed explanation for the difference between the original estimated costs, which formed the basis of the Ordinance, and the current cost of the facilities. Backe:round In early 1994, the City retained Wilson Engineering to prepare a basin plan with the primary goal of identifying facilities needed to support development within the Salt Creek Basin, and determining a funding mechanism to pay for these facilities. Upon completion of the "1994 Wilson Study"] Wilson Engineering identified an alignment for the Salt Creek Gravity Sewer Interceptor, consisting of more than 13.5 miles of sewer line ranging in diameter from 15 inches to 36 inches as the required facility to serve the benefit area (See Exhibit A). The defined benefit area included the area now known as Wolf Canyon Basin. In order to fund the project, the 1994 Wilson Study evaluated three alternatives for establishing a Development Impact Fee. The alternative that was ultimately adopted by the CitY required the establishment of a "Benefit Area Fee" to finance the construction of Reaches 1 through 8 of the Salt Creek Interceptor. It was dete=ined that since Reach 9 of the trunk sewer would be conveying flows from other basins in addition to the Salt Creek Basin, it should be considered a regional facility and therefore, should be a City obligation. At that time, the cost of the whole project was determined to be $18.1 million. Of this amount, $8.2 million (the cost of Reaches 1 through 8) was used to calculate the DIF and was spread among 28,737 benefited EDUs. The remaining $9.9 million (the cost of Reach 9) was deerned to be City obligation. Based on the 1 Salt Creek Basin, Gravity Sewer Analysis, dated November 81994 2 Ordillance No. 2617, adopted on December 6, 1994 Update to the Salt Creek Sewer Basin PIan August 2004 I 0:: 0:: ~ We:: we::oð~ z Ze:: ~IÔ> 3:: ~~OO:::¡ 0 OUJ · w '- ~UJO~ >-UJ UJ ~l 6ª · ~ :r: >-s: · c Z UJcnl-l- UJcnI-UJ::::I Zz c.. Z >- , UJ c.....J UJ c..c.. «- «Z::::¡ ZUJ e:: ~ ...J '><:CD~ ~UJ- O::~UJOID ü...J «cn « u · Z CDcnU. e:: Ü::::l · 00:: 0::0e:: Ü~ I ~ >-15 Ü-e::ID Ü-~ü:JUJ _e:: 0 · W e::W (!)W (!)>-W U.z ~~ · ():= I ~~UJ~ ~~~[¡jg · l? 1-3:: _>c: <93:: ~z3:: ...J:::¡ '<t """) ~ UJUJ -mo «0::1-- OUJ UJ«UJ 00:: _0 0 :2: ~ W :::!:cn m'-Z cn<9Z~ cn<9Z8.cn c..cn I-ücn 3::1- üID - cn<9~ I.() - ¡ ..J . I · :I: · . , · ~ · . I ..... ~ , · · - CI) I · I '<t · · · ¡ · ¡:. · 0 ;;..: · I · t · I · · · [( a 0 · , LU Z · CI) ! ~ ~~~~ Ô~ > ...:¡p.:¡p.:¡cn LU <~~< ~.~ e::: 0 uB3¡:Q <t:¡:Q u~ en ~~ , .- Z :! Op.:¡ () 0 ~cn W - ,. """') ~ ,i 0 e::: () a.. 0 'I ....J , I ~ ~~ ~: <C -< ~~ g¡~ r.¡¡r.¡¡ è;rJJ:g ~~ co I- CI) ...!. ii 0:: " UJ m i¡ 3:: II UJ en I 0 e::: J: I- m UJ !J> UJ I a:: ., :::!: ...J >< I! "' « z.~ ü cn 0 W l- S< I- 0 Z cost of the DIF portion of the facility, and the number of dwelling units within the benefit area, the Salt Creek Sewer Basin DIF was established at $284 per EDU. Salt Creek Proiect Status Since then, all reaches of the Salt Creek Trunk Sewer within the DIF have been constructed. Reaches 1, 2A, 2B, 4B and SA were constructed by developers and the City at an estimated cost of $1,231,172. Reaches 3, 4A, 5B, 6, 7, 8A, 8B, 9A, 9B and 9B' were recently constructed by the City. Based on a recent analysis performed as part of the Engineer's Report, the overall cost of the project has increased from $18.1 million to $32 million. Inclusion of additional facilities Salt Creek Reach 9A When the Salt Creek DIF was established in 1994, Reach 9 was expected to be a regional facility, since it served other areas in addition to the Salt Creek Basin (i.e. Main Street and Poggi Canyon Basins). To expedite the construction of this trunk line, Reach 9 was further divided into 3 sub-reaches, Reaches 9A, 9B and 9B'. However, through this update, staff has determined that since Reach 9A, which begins just west of Heritage Road and ends just west of Interstate 805, actually serves only the Salt Creek Basin, it cannot be considered a regional facility. Therefore, the cost of this portion currently estimated at $6.2 million is now recommended to be a DIF obligation. As earlier stated, the overall cost of the Salt Creek Trunk Sewer line is now estimated at $32 million. With this proposed change, the DIF obligation now amounts to $20.2 million; the remaining $11.9 million is the revised amount of the City obligation. WolfCanvon Trunk Sewers The 1994 Wilson Study did not identify the need for any major trunk sewers to serve the Wolf Canyon Basin. Although the properties within the Wolf Canyon Basin were considered in that study to be part of the "Benefit Area", it was assumed that these properties would connect directly to the Salt Creek Sewer via laterals. More recent analyses by various land owners and the City have determined that two additional trunk sewer lines will be needed to serve these properties. One trunk sewer line will be located within the future Rock Mountain Road and the other will be located in Heritage Road. These two lines ("The Wolf Canyon Trunk Sewers") consisting of approximately 15,700 feet of PVC pipe ranging in size from 10 to 15 inches will ultimately connect to the Salt Creek Trunk Sewer. Since the Wolf Canyon Basin is tributary to the Salt Creek Basin, and was included within the Benefit Area, this update recommends the inclusion of these required facilities in the Salt Creek Gravity Sewer Basin DIF, thus distributing these additional costs among all the EDU's within the benefit area. It is currently estimated that the total cost of these additional facilities will be approximately $5,716,000. Update to the Salt Creek Sewer Basin Plan August 2004 2 p Fee Calculation When the Salt Creek DIF was established in 1994, the fee was spread amongst 28,737 EDUs within the benefit area. Based on a detailed analysis in the Engineers Report, the remaining number of benefited properties in the basin is currently 19,191 EDUs. Therefore, based on these revised costs, and the updated number of remaining benefited properties in the benefit area, the Salt Creek DIF needs to be increased from $2841EDU to $1,330IEDU (Table 4.4). Cost Increase Elements The main reasons for the increase in the overall cost of the Salt Creek Gravity Sewer which ultimately resulted in the significant increase in the Salt Creek DIF are as follows: (The costs shown are the additional costs not included in the 1994 DIF and are for the overall Salt Creek Trunk Sewer) 1. Changes in planned land-use intensities, which necessitated upsizing of several segments. (+$0.5 Million) 2. Environmental and right-of-way constraints which necessitated the following changes: a. Installation of a Supervisory Control and Data Acquisition System (SCADA) (+$0.5 Million). b. Installation of a dual pipe system to provide redundancy in the system and allow the pipes to remain buried in a section of the pipeline that goes through the MSCP area (+$1.0 Million). c. Establishment of the Preserve Management Endowment Fund (PMEF) (+$1.0 Million). 3. Depth of the Trunk Line -Utility information, which was not available in 1994 when the Wilson Study was prepared, and which later dictated that the pipeline be installed at depths greater than those originally conceived at some locations. This also resulted in a wider trench and the replacement of a significant amount of paving. (+$2.0 Million) 4. Increased level of Staff and Consultant Resources needed to complete the project (+$3.1 Million). 5. The ENR Construction Cost Index went up 29% between 1994 and today. Accounting for inflation alone, the DIF should have increased from $284 to $366. (+$2.7 Million) 6. Intensity of development activity, - which resulted in more aggressive project schedules and expensive installation strategies that ultimately affected the cost of the project. (+$2.8 Million) 7. Capital Expenditure for the acquisition of a special maintenance vehicle, which was not originally anticipated (+$300,000). Update to the Salt Creek Sewer Basin Plan August 2004 3 Project changes that only affected the DIF include: 1. The inclusion of additional Salt Creek Sewer Facilities (Reach 9A) as a DIF Facility (+$6.1 Million). 2. The inclusion of Wolf Canyon Sewer facilities (Rock Mountain Road Sewer and Heritage Road Sewer) as a component of the Salt Creek DIF Faciliiies (+$5.7 Million). 3. A reduction in the number of benefited properties responsible for financing the cost of the facilities. Analvsis and Staff Recommendations Overall costs of the Salt Creek Gravity Sewer Interceptor and the Wolf Canyon Trunk Sewer were determined using the latest construction cost estimates provided by developers, City staff and consultants retained by both developers and the City. This report recommends that the total construction cost of Reaches 1 through 9A of the Salt Creek Gravity Sewer Interceptor and the Wolf Canyon Trunk Sewers be distributed among all benefited properties within the Salt Creek and Wolf Canyon Basins. This recommendation is consistent with the methodology utilized in the 1994 Wilson Study and is the most equitable approach since all properties essentially receive the same service. Based on the analysis set forth in this report, Staff recommends the following amendments: a. To add the Rock Mountain Road and Heritage Road Trunk Sewer lines (Wolf Canyon Sewer Facilities) and Reach 9A to the list of facilities financed by the Salt Creek Sewer Basin DIF. b. To amend the Master Fee Schedule, increasing the fee from $284 to $1,330 per EDU. Update to the Salt Creek Sewer Basin PIan August 2004 4 2.0 Project Description Salt Creek Sewer Basin The Salt Creek Sewer Basin is that area in the easterly part of the City commonly referred to as the "Eastern Territories" and conveys flows mostly from portions of EastLake, Otay Ranch and Rolling Hills Ranch. It also encompasses portions of the Otay River Basin, as well as portions of the unincorporated area north and east of the Otay Lakes. Furthermore, the Salt Creek Basin as shown in the Benefit Area Map (Exhibit A) also encompasses a smaller sewer shed area known as Wolf Canyon Sewer Basin The 1994 Wilson Report In early 1994, the City of Chula Vista retained the services of Wilson Engineering to prepare a report, which analyzed the sewage flows from the proposed developments in the Eastern Territories, and identify a facility that would serve the tributary properties. In November of 1994, Wilson Engineering submitted a report titled "Salt Creek Basin, Gravity Sewer Analysis" (hereafter referred to as the 1994 Wilson Study; see Appendix A, hereto). This report recommended the construction of approximately 12.5 miles of sewer line ranging from 15 inches at the easterly.end to 36 inches at the westerly end. The Salt Creek Trunk Sewer generally begins just west of the Upper Otay Reservoir, then proceeds southerly parallel to the Salt Creek and the Otay Valley Rivers, then turns Westerly along Main Street, continuing under the I-80S Freeway along Main Street to Industrial Blvd., after which it goes under the 1-5 Freeway and terminates at a junction structure that ties it to the City of San Diego's Metro Sewer line just west of Interstate 5 on Frontage Road. The line was segregated into nine Reaches, which were divided primarily at points of major slope changes and locations where significant amount of sewage flow from tributary properties entered the line. Exhibit A, of this update, shows the alignment of the nine Reaches. This 1994 Wilson Study also developed the basis for establishing the Salt Creek Sewer Basin Development Impact Fee to pay for the eastern portion of the Salt Creek Gravity Sewer Interceptor It was recommended in the 1994 Wilson Study that the downstream Reach (Reach 9), which consisted of approximately 27,000 linear feet (5.11 miles) of36-inch main be funded through the use of the City's Trunk Sewer Capital Reserve Fund. The basis for the recommendation was that upon completion, Reach 9 would convey all sewage from the Salt Creek Basin along with the total flow from the Poggi Canyon Basin, the Wolf Canyon Basin and a portion of the flow from the Main Street Sewer Basin. The City later approved the 1994 Wilson Study and the recommendations were adopted by Ordinance. Ordinance No. 2617 On December 6, 1994, the City Council adopted Ordinance No. 2617 (Appendix B) establishing the Salt Creek Sewer Basin Development Impact Fee to provide funding for the construction of Update to the Salt Creek Sewer Basin Plan August 2004 5 Reaches 1 through 8 (approximately 43,976 linear feet). The DIF was set at $284 per Equivalent Dwelling Unit (EDU). This Ordinance which was based on the 1994 Wilson Study outlined the facilities that would be financed by the DIF. Furthermore, it also provided the mechanism for modification and amendment of the list of facilities in order to maintain compliance with the City's Capital Improvement Program or to reflect changes in land development and estimated and actual wastewater flow. In addition, the Ordinance amended Chapter XVI of the Master Fee Schedule, by adding Section C that describes the guidelines for the Salt Creek Sewer Basin DIF. Section C delineates the territory to which the fee is applicable, sets the rate per EDU, states how the EDUs will be calculated, when the fee is payable and authorizes City Council to adjust the fee as necessary to assure construction of the facilities. Furthermore, Ordinance No. 2617 gave developers the option of voluntarily constructing portions of the facilities and set forth the procedure for reimbursement. The Dudek Report A few years later, when the need for the Salt Creek Trunk Sewer became imminent, City Council on June 8, 1999, awarded a contract to Dudek & Associates for the provision of engineering and environmental services necessary to prepare the preliminary design of the "Salt Creek Gravity Sewer Interceptor" (referred to as the "Salt Creek Trunk Sewer"). Utilizing the 1994 Wilson Study as the basis of design, Dudek & Associates analyzed three alternative alignments for the remaining portion of the Salt Creek Trunk Sewer (a portion of the line had earlier been constructed in 1997 as a joint project between SDG&E and the City based on the 1994 Wilson Study). Dudek ultimately recommended an alignment that generally paralleled the Salt Creek and the Otay Valley beginning at the Olympic Parkway Pump Station and terminating at the City of San Diego's Metro Sewer collection system west of Interstate 5 Freeway. In May 2000, Council awarded a contract to Dudek & Associates for the preparation of the final design plans for the Salt Creek Trunk Sewer. Since then, the project design has been completed, and the pipeline has been constructed except including the portion that involved micro-tunneling under 1-5. Proiect Detail - Salt Creek Trunk Sewer The Salt Creek Trunk Sewer was designed to convey flows from the developments within the Salt Creek Sewer Basin. However, in addition to conveying flows from the Salt Creek Sewer Basin, a portion of this trunk line will also convey flows from the Poggi and Wolf Canyon Sewer Basins and a small portion of the Main Street Sewer Basin. The Salt Creek Trunk Sewer consists of nine Reaches. Of these nine Reaches, the following portions were constructed at an estimated total cost of $1,231,172: a. Reach 1 was constructed by Pacific Bay Homes (now McMillin) - FY 1997/98 6 Update to the Salt Creek Sewer Basin Plan August 2004 b. Reaches 2A and 2B were constructed by Eastlake Company- FY-2000/01 c. Reaches 4B and SA were constructed by the City as a joint project with San Diego Gas & Electric in FY -1996/97. See table 2.1 for details The City constructed the remaining Reaches (Reaches 3, 4A, 5B, 6, 7, 8A, 8B and 9A) at an estimated cost of $19,168,544, which will be an element of the revised DIF. Reaches 9B and 9B', also constructed by the City, are not included in the DIF. The estimated cost for each of the Reaches 3 through 9 is shown on Table 2.2 The nine Reaches are described below as follows: Reach 1 Reach 1 was constructed by Pacific Bay Homes to serve the Rolling Hills Communities. It consists of approximately 4,517 linear feet of IS" PVC pipe. Currently, this pipe terminates at the Otay Lakes Road Pump Station. Based on the cost estimate and addendums provided by Pacific Bay Homes to the City, the total cost of this Reach including construction, inspection and administration was approximately $173,613. See Appendix F for the Final Construction Cost Estimate. Reach 2 Reach 2A Reaches No. 2A and 2B were constructed by the Eastlake Company to serve Eastlake Trails North Community. Reach 2A consists of 2,204 linear feet of 18" PVC. Based on the cost estimate and addendums provided by the Eastlake Company to the City, the total cost of this Reach including construction, inspection and administration was approximately $112,199. See Appendix D for the Final Construction Cost Estimate. Reach 2B Reach 2B was constructed by Eastlake Company to serve Eastlake Trails South community. It consists of 2,327 feet of 18" PVC pipe. Reach 2B currently ends at the Olympic Parkway Pump Station. Based on the cost estimate and addendums provided by the Eastlake Company to the City, the total cost of this Reach including construction, inspection and administration was approximately $267,660. See Appendix D for the Final Construction Cost Estimate. Reach 3 Reach 3 consists of 2,391 linear feet (L. F.) of dual 20" PVC and 194 L. F. of single 20" PVC pipe. Reach 3 begins at the Olympic Parkway Pump Station and terminates at the northerly portion of Reach 4A. 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Q ..J -!I&I :E 6 ¡,~i ~ ~ ì~' ¡¡~ :~ 'õ I,m, ¡ ::1: U jIE ~i ;I/ ''0: 0' ~ ,...., ;0 ~ ~..,- r- - -- - .-- ~ j ~ · · e ;; · ^ · · ~. 0< ~~ n c œ 3 i , ~ - Reach 4 Reach 4A Reach 4A consists of 3,452 1. F. of dual 24" PVC, 562 1. F. of single 24" PVC and 2,3101. F. 10" PVC pipe. The total cost for Reach 4A is $2,921,271. See Appendix G for the Final Construction Cost Estimate. Reach 4B Reach 4B was constructed by San Diego Gas & Electric (SDG&E) as part of a joint project with the City of Chula Vista. SDG&E was reimbursed $341,509 for this segment. This Reach consists of 2,608 linear feet of 24" PVC pipe. For the engineering design for Reaches 4B and SA, the City paid a total of $58,814. Of this amount, $33,883 was exclusively for the design of Reach 4B. These costs are shown in a letter from Village Development (a consultant who worked on the project) dated October 31, 1997. The total cost for Reach 4B, including construction, design, inspection and administration, is $390,422. See Appendix E for the Final Construction Cost Estimate. Reach 5 Reach SA Reach SA consists of 1,919 linear feet of 24" PVC pipe and was also constructed by San Diego Gas & Electric (SDG&E) as part of the joint project with the City of Chula Vista. The total reimbursed to SDG&E for the construction of Reach SA was $251,286. The City paid $24,931. for the design services for this Reach. The total cost for Reach SA, including construction,' engineering services, inspection and administration, is $287,278. See Appendix E for the Final Construction Cost Estimate. Reach 5B Reach 5B consists of 3,654 1. F. of 30" PVC pipe. The construction cost for Reach 5B is $1,295,895; this cost includes construction, engineering services, inspection and administration. See Appendix G for the Final Construction Cost Estimate. Reach 6 The cost for Reach 6, including construction, engineering services, inspection and administration, is $973,024. Reach 6 consists of 2,924 linear feet of 30" PVC pipe. See Appendix G for the Final Construction Cost Estimate. Reach 7 Reach 7 consists of 8,4201. F. of 36" PVC pipe. The cost, including construction, engineering services, inspection and administration, for Reach 7 is $3,222,772. See Appendix G for the Final Construction Cost Estimate. Update to the SaIt Creek Sewer Basin Plan August 2004 8 - - ... . Reach 8 Reach 8A Reach 8A consists of 2,542 linear feet of 42" PVC pipe and has a cost, including construction, engineering services, inspection and administration, of $1,218,959. See Appendix G for the Final Construction Cost Estimate. Reach 8B Reach 8B consists of 3,952 linear feet of 42" PVC; it has a cost, including construction, engineering services, inspection and administration, of $1,895,193. See Appendix G for the Final Construction Cost Estimate. Reach 9 Reach 9 is the final segment of the Salt Creek Interceptor, which connects the system to the existing 72" City of San Diego Metro Sewer Interceptor on West Frontage Road. Reach 9 consists of approximately 26,300 linear feet of 42" and 48" PVC. It is estimated that the total cost, including construction, engineering services, inspection and administration, will be $18,163,774. To expedite the construction of this trunk line, Reach 9 was further divided into 3 sub-reaches, Reaches 9A, 9B and 9B'. See Appendix G for the Final Construction Cost Estimates for all three reaches. Reach 9A Reach 9A consists of approximately of 1,500 linear feet of 42" PVC and 9,400 linear feet 48" PVC totaling 10,900 linear feet and cost $6,115,322 to construct. Reach 9B Reach 9B consists of approximately 14,000 linear feet of 42" PVC and cost $7,657,988 to construct. Reach 9B' Reach 9B' consists of approximately 1,300 linear feet of 42" PVC and is currently being installed by micro tunneling under Interstate 5. It is estimated that the total cost, including construction, engineering services, inspection and administration, will be $3,936,373. Summary of Contractors Utilized in the Construction of the Salt Creek Gravity Sewer Interceptor To better manage the design and construction of Reaches 3 through 9 of the Salt Creek Trunk Sewer, the project was divided into four major phases (1 through IV). Salt Creek DIF Eligible Portions Phase III, which consists of Reaches 5B, 6, 7, 8A, 8B and 9A, (constructed along Main Street east ofI-805 and within Otay Valley and Salt Creek toward Olympic Parkway) was awarded to Cass Construction, Inc. on August 13, 2002. This phase is included in the DIF obligation. Update to the Salt Creek Sewer Basin Plan August 2004 9 Phase N, which consists of Reaches 3 and 4A (the portion between Phase III and Olympic Parkway) was awarded to Don Kelly Construction on September 4, 2002. This phase is included in the DIF obligation. Citv Obligated Portions Phase I, which consists solely of Reach 9B, (Main Street, between 1-5 and I-80S) was awarded to a joint venture of Hazard Construction Company and TC Construction Company, Inc. on August 22, 2001. A substantial portion of the contract was for pavement reconstruction associated with the pipe installation. This portion of the Salt Creek project is considered a regional facility, was funded with Trunk Sewer Capital Reserve Funds and was not included in the fee revision. Phase II, which is Reach 9B', was awarded to Modern Continental on November 26,2002. This is the only phase of the project still under construction, due to some unanticipated setbacks resulting from the tunneling operation. This remaining portion of Reach 9 was also funded with Trunk Sewer Capital Reserve Funds and was not included in the fee revision. F or details of the bid items, see Appendix H. Wolf Canyon Trunk Sewers Description The Wolf Canyon Sewer Basin is located within the City of Chula Vista and is the natural drainage Basin for a portion of the Eastern Territories. This basin is located to the south of the Poggi Canyon Sewer Basin and is tributary to the Salt Creek Sewer Basin; therefore it could be referred to as a sub-basin of the Salt Creek Sewer Basin. The Wolf Canyon Sewer Basin extends south of Birch Road and north of Main Street (Otay Valley Road), east of Heritage Road (Paseo Ranchero) and mostly west of the proposed State Route (SR) 125 (see exhibit A). Dudek Study In the early part of 2000, when the City was still in the preliminary stages of planning for the Salt Creek Trunk line, McMillin Companies, one of the developers within the Wolf Canyon Basin, approached the City to begin the effort to plan for the design and construction of a facility to serve the projects within the Wolf Canyon Basin. The intent at that time was to accelerate the planning effort for the Wolf Canyon to be concurrent with the planning effort for the Salt Creek Trunk Sewer. Pursuant to an understanding between the City & McMillin, McMillin agreed to finance the initial planning and design effort and be reimbursed at a later date when a funding mechanism was established for the facility. To this effect, City Council, on May 2000, awarded a contract for the design of both the Wolf Canyon Trunk Sewer and the Salt Creek Trunk Sewer to Dudek & Associates. The City also retained McGill Martin Self, Inc. (MMS) as the Project Manager for both projects. However, as the planning and design effort for the Salt Creek Trunk Sewer intensified, the project team determined that there was insufficient information on a variety of important issues 10 Update to the Salt Creek Sewer Basin Plan August 2004 ~,,~ in the Wolf Canyon Basin to continue the planning effort for both projects at that time. Therefore, it was decided that the planning effort for the Wolf Canyon Project would be delayed until the design effort for the Salt Creek Trunk Sewer was completed. In mid 2003 when all the phases of the Salt Creek Trunk Sewer were already under construction, the City focused on the planning effort for the Wolf Canyon Sewer facilities. In October 2003 Dudek completed the "Preliminary Design Report for the Wolf Canyon Trunk Sewer". This Preliminary Design Report explored a variety of options for alignment of a trunk sewer line that would serve the Wolf Canyon Basin. The Preliminary Design Report ultimately identified an alignment for the Wolf Canyon Trunk Sewer, which generally followed a disturbed jeep trail located at the bottom of Wolf Canyon. The City also needed to address some of the earlier concerns raised by the environmental community regarding potential impacts from locating the sewer alignment within the bottom of Wolf Canyon. The alignment identified in Dudek's Preliminary Design Report was primarily within the bottom of the canyon and would potentially have impacted both wetland and upland habitats. - Consequently, the City retained HGB & Associates to explore other options for the provision of sewer service to properties within Wolf Canyon. Based on the analysis conducted by HGB & Associates, and City discussions with the property owners in the Wolf Canyon Basin, it was decided that sewer service would be provided to properties within the Wolf Canyon Basin utilizing the following trunk lines: a. Rock Mountain Road Trunk Sewer Line b. Heritage Road Trunk Sewer Line These lines are shown in detail in the attached Exhibit C Proiect Detail-Wolf Canyon Trunk Sewers Rock Mountain Road Trunk Sewer Line This is a 15" diameter sewer line which is currently planned to be located generally along the future Rock Mountain Road (approx. 7,400 L.F. of 15") This line will convey flows from portions of Villages 4, 7 and 8. The City is beginning the planning and design effort for this trunk line. It is estimated that this line will be in operation by 2007, and will cost approximately $4,460,000 to construct (See Appendix C - Summary of Wolf Canyon Trunk Sewer Costs - for details). Heritage Road Trunk Sewer Line - This is a 10" to 12" diameter sewer (approx. 3,100 L.F. of 10" & 1,500 L.F. of 12") line that will convey flows from portions of Villages 2 and 3. This line is anticipated to be constructed by the Otay Ranch Company either concurrent with the construction of the future Heritage Road or as a Update to the Salt Creek Sewer Basin Plan August 2004 11 Q ffi d ~ 0:: ° CI ~ W c.. (J)o::~ OWe:: ~$:W o::W~ c..(J)~ I I · · · · , , · ~ z+" ¡:¡: ~ U ¡z¡ o E-< E-< o Z c::: 1IolYYtNÐ&a~.L'1V!rIIOOt'imtá3S\1ŒNID~I ° ~ <.9 fu Ze::u ~we:: (J)$:W ><W~ W(J)Z o \ /,..:" . ifl ~ .. ~~ 0"""" µ..d iflU ~~ i~ d~ ,,"""ifl ~Z ~O ~~ ~µ.. c..; ~ ~ ~ ~ r:/'1 us: ~:5 ~~ S~ ~U ><~ µ,:¡O ~ ~ ~ U separate facility prior to the construction of Heritage Road, as will be determined by the City. It is estimated to cost $1,256,000, and be operational by 2007. Therefore, the total cost of these facilities, which are needed to provide sewer service to the properties in the Wolf Canyon Basin is approximately $5,716,000, as shown in Table 2.3. Table 2.4 shows a s=ary of project Costs by Reach. Analvsis of the inclusion of the WolfCanvon Trunk Sewers within the Salt Creek DIF 1. Benefit Area - When the Salt Creek DIF was established in 1994, the defined benefit area included the area now referred to as Wolf Canyon Basin although it was not specifically identified and termed as such. Thus, the defined benefit area demonstrates that it was always intended that these properties would pay the Salt Creek DIF. 2. Ordinance Provision - Section 4 of Ordinance 2716 allows for the modification of the list of covered facilities. The 1994 Wilson Study did not specifically identify the Wolf Canyon Trunk Sewer as a required facility at that time. However, now that the need for the facility has been established and described in the "Wolf Canyon Sewer Preliminary Design Report", dated October 9, 2003 by Dudek and Associates, it is appropriate and necessary for the Ordinance to be modified to include the Wolf Canyon Sewers. 3. Equality in Service Received - All the properties within the benefit area receive the same benefit by being served with a gravity sewer line from the City. Under the current DIF, every property within Salt Creek Basin including the area defined as Wolf Canyon Basin receive the same service irrespective of where they connect to the Salt Creek Gravity Sewer. Since the original Salt Creek Development Impact Fee was the same for all properties irrespective of where they were located (either upstream at the most northerly end of the line or downstream at the most westerly end of the line) their cost was the same. Therefore, consistent with the underlying assumptions that formed the basis of the original DIF, this revised fee also reflects the allocation of the cost of the required facilities amongst all the benefited properties pipe network established to serve these properties. Analvsis of the inclusion of Reach 9A ofthe Salt Creek Trunk Sewer to the Salt Creek DIF When the Salt Creek DIF was originally established, the reaches were defined based on the locations where there was a significant change in grade or at points where a significant amount of flow entered the line. Reach 9 was originally intended to serve areas other than the Salt Creek Basin; therefore it was considered a regional facility and was scheduled to be constructed with public funds (Trunk Sewer Capital Reserve Funds). However, during the course of preparing the design plans for the Salt Creek Trunk Sewer it was determined that Reach 9 could be further delineated into 3 separate reaches, 9A, 9B & 9B'. A review of these reaches showed that Reaches 9B and 9B' both conveyed flows from several basins (Salt Creek, Wolf Canyon, Poggi Canyon, and the Main Street Basins), while Reach 9A Update to the SaIt Creek Sewer Basin PIan August 2004 12 TABLE 2.3 Construction Estimate for ROCK MOUNTAIN ROAD AND HERITAGE ROAD TRUNK SEWER LINES (Wolf Canyon Trunk Sewer Facilities) HeritaQe Trunk Sewer Item .Q!ï Unit Unit Price Amount A-1 12" PVC Sewer 1,500 LF $ 110.00 $ 165,000.00 A-2 10" PVC Sewer 3,100 LF $ 90.00 $ 279,000.00 A-3 Manholes 16 EA $ 15,000.00 $ 240,000.00 -4 Overexcavation 1000 CY $ 20.00 $ 20,000.00 A-5 Salt Creek Connection 1 LS $ 75,000.00 $ 75,000.00 A-6 MoblDeMobl1 nsurance/Bonds 1 LS $ 75,000.00 $ 75,000.00 A-7 As Built Plans 1 LS $ 10,000.00 $ 10,000.00 A-8 Monitoring & Cleanup 1 LS $ 10,000.00 $ 10,000.00 Subtotal $ 874,000.00 25% Contingency $ 218,500.00 Construction Total $ 1,092,500.00 Soft Costs (15%) $ 163,500.00 Total $ 1,256,000.00 Rock Mountain Trunk Sewer Item 9!ï Unit Unit Price Amount B-1 15" PVC Sewer 7,400 LF $ 145.00 $ 1,073,000.00 B-2 Sewer share for pioneering road grading 1 LS $ 212,000.00 $ 212,000.00 B-3 Manholes 25 EA $ 15,000.00 $ 375,000.00 B-4 Access Road 2,000 LF $ 35.00 $ 70,000.00 B-5 Salt Creek Connection 1 LS $ 75,000.00 $ 75,000.00 B-6 MoblDeMobllnsurancelBonds 0.75 LS $ 200,000.00 $ 150,000.00 B-7 As Built Plans 0.7 LS $ 10,000.00 $ 7,000.00 B-8 Monitoring & Cleanup 0.7 LS $ 10,000.00 $ 7,000.00 B-9 Construction Fencing 20,000 LF $ 0.10 $ 2,000.00 Subtotal $ 1,971,000.00 25% Contingencý $ 492,000.00 Construction Totai $ 2,463,000.00 Soft Costs $ 1,997,000.00 Total $ 4,460,000.00 Road Costs C-1 Earthwork 1 775,000 CY $ 1.25 $ 968,750.00 C-2 Export' 425,000 CY $ 1.50 $ 637,500.00 C-3 Arch Culvert Crossing2 600 LF $ 5,000.00 $ C-4 Overexcavation of unsuitable fill 5,000 CY $ 20.00 $ 100,000.00 C-5 Subdrains 3,600 LF $ 18.00 $ 64,800.00 C-6 Drainage facilities 1 LS $ 375,000.00 $ 375,000.00 C-7 Environmental Mitigation 1 LS $ 500,000.00 $ 500,000.00 $ 2,646,050.00 B-2 Sewer share for pioneering road (8% of road costs) $ 211,684.00 1. Represents earthworlt quantity to grade road from east side of Wolf Canyon to La Media. Quantity does not ¡ndude the nil needed within the canyon for the future road crossing. 2. Cost of arch culverts not included. They will be future roadway costs and wilt not be needed for sewer construction. (Final S.C. & W.C. Exhibits & Cals.xis: Rock,Heritage,to La Media_TbI3a) (08/0212004) exclusively served properties in the Salt Creek Basin, hence the reason for the recommendation to include that portion of the Salt Creek Trunk Sewer as a DIF facility. Table 2.4 List of Facilities SALT CREEK TRUNK SEWER PHASE REACH LENGTH COST 1 4,517 LF $173,613 2A 2,204 LF $112,199 2B 2,327 LF $267,660 N 3 2,585 LF $1,526,107 N 4A 6,324 LF $2,921,271 4B 2,608 LF $390,422 SA 1,919 LF $287,278 ill 5B 3,654 LF $1,295,895 ill 6 2,924 LF $973,024 ill 7 8,420 LF $3,222,772 ill 8A 2,542 LF $1,218,959 ill 8B 3,952 LF $1,895,193 ill 9A 10,903 LF $6,115,322 I 9B 14,010 LF $7,657,988 II 9B' 1,329 LF $3,936,373 WOLF CANYON TRUNK SEWERS Rock Mountain Road Herita e Road Update to the SaIt Creek Sewer Basin PIan August 2004 13 3.0 PROJECT COST JUSTIFICATION A re-evaluation of construction costs has been made, and as described below, it shows that the project cost estimate on which the DIF was established in 1994 has increased significantly. Therefore, the current fee will not be sufficient to reimburse the Trunk Sewer Reserve Fund used finance the construction of the Salt Creek Gravity Sewer Interceptor and the Wolf Canyon Trunk Sewers. The main reasons for the increase in the cost of the Salt Creek DIF Facilities and consequently the DIF Fee are as follows: 1. Land-Use Changes The City's design standards for the construction of sewer lines greater than 13 inches diameter requires these sewer lines to be designed such that the sewage flows at a depth no more than 75% of the pipe's diameter when conveying design flows. This guideline provided the basis of the preliminary sizing of the facility identified in the 1994 Wilson Study, which formed the basis of the DIF. The Wilson Study also distributed the cost amongst the benefit area based on the available information on the land uses for the various projects. Since then, the land-use projections for development within the entire Salt Creek Sewer Basin has changed significantly from the assumptions made in 1994; several proj ects within the Basin have now been developed, and some were approved at densities higher than what was originally contemplated in the 1994 Wilson Study. Consequently, this mandated a revision of the hydraulic analysis for the system. A hydraulic analysis "Salt Creek Interceptor Sewer - Hydraulic Basis oj Design Report" dated April 2003was prepared by Dudek & Associates as part of the project design This Report was the basis of the City's decision to increase the diameter of the trunk line within several reaches of to comply with the City's Design Standards. 2. Environmental and Right-of-Way Constraints a. Environmental and right-of-way constraints, which were not originally anticipated, led to the realignment of the pipeline through additional segments of Main Street. During the planning stages of the Salt Creek Gravity Sewer Interceptor, some members of the environmental community expressed concerns regarding potential impacts to sensitive biological resources along the alignment being considered for the Salt Creek Trunk Sewer. That alignment was shown in the Preliminary Design Report for the Salt Creek Gravity Sewer Interceptor prepared by Dudek & Associates dated January 2001. The area of concern was primarily in the upper reaches of the Salt Creek Canyon within Reaches 3 & 4 and in the lower portion of Reach 9 west of Hollister. To address some of these concerns, the Trunk Sewer was realigned to avoid (as much as possible) impacts to natural drainage systems, wetlands and upland habitat. Update to the Salt Creek Sewer Basin Plan August 2004 14 ~O>. , b. Furth=ore, the environmental community was also concerned about the impacts of human activity within the Preserve along the path of the alignment (specifically within portions of Reaches 3 & 4); to address their concerns, these Reaches were designed as dual-pipe systems with a Supervisory Control and Data Acquisition System (SCADA). The dual pipe system will provide redundancy in the system and allow the pipes to remain buried in that section and negate the need for routine maintenance. Moreover, the SCADA system will allow remote monitoring of the entire pipeline, and has the ability to alert the City in the case of an emergency. c. In addition to these project features, a contribution was made to the Preserve Management Endowment Fund (PMEF) following issuance of the City's Section 10(a) permit under the Federal Endangered Species Act. This contribution of $1,000,000 was required as a part of the Salt Creek Gravity Sewer Interceptor project. The Salt Creek Trunk Sewer is a planned facility through the preserve and the funds will be utilized for preserve restoration and maintenance. For a complete account of the environmental concerns and recommendations made by the environmental community and a full explanation on how they were addressed by the City, please refer to the "Final Program Environmental Impact Report - Salt Creek Interceptor Sewer and Wolf Canyon Trunk Sewer", prepared by Dudek & Associates dated June 2001. 3. Final Depth of the Trunk Line Utility information, which was not available in 1994 when the Wilson Study was prepared, later dictated that the pipeline be installed at depths greater than what was originally conceived. Consequently, the deeper pipeline resulted in wider trenches leading to additional reconstruction work along Main Street. It is important to emphasize that the findings and recommendations made in the 1994 Wilson Study were based on available reports and maps (USGS, 2000-scale and 7.5-minute series quadrangle maps were used to estimate the minimum slope and the natural topography of the area). The 1994 Wilson Study does not make any reference to any geotechnical reports used in the preparation of the study. The fmal construction plans for the Salt Creek Gravity Sewer Interceptor prepared by Dudek & Associates (for Phases I through IV) clearly show the final depths of the pipe. 4. Required Level of Staff and Consultant Resources The project has required a greater level of consultant and staff resources to prepare design plans, manage the project and provide legal consulting services such as for right of way acquisition that were not originally anticipated. Based on the feedback from the environmental community regarding the potential negative impacts to the biological resources and how to mitigate them, the City determined that it would be prudent to retain additional consultants (i.e. environmental Update to the Salt Creek Sewer Basin Plan August 2004 15 consultants, land surveyors, geotechnical engineers, legal counsels, right-of-way acquisition consultants), to assist City staff in the completion of the project. Furthermore, to coordinate the efforts of the consultants, City staff, public agencies, contractors and the development community, it was necessary to retain an engineering consulting finn to provide project management services. 5. Updated Cost Estirnates The adopted Salt Creek Sewer Basin DIF was based on an engineer's estimate, which in turn was based on the cost of the various components as of 1994. However, since then the Engineering News Record (ENR) Construction Cost Index has changed by approximately 29% (from 5439 in December 1994 to 7017 in ApriI2004). This proposed DIF update is based mostly on the actual construction and administrative costs. The City has already received bids, awarded all the phases and constructed most of the Salt Creek Gravity Sewer Interceptor. As a result, actual costs are being used to determine the final cost of the project (for bid results, see Appendix H of this report). The Wolf Canyon Trunk Sewer Facilities are in the early planning stages; therefore, the construction cost is based on the project engineer's estimate. Refer to Table 2.3 and Appendix C of this report for the engineer's estimate. 6. Intensity of Development Activity The pac.e of development activity within the City, the importance of the proj ect for the continuation of development and the fast pace at which existing sewer facilities were approaching threshold capacity, resulted in aggressive project schedules and expensive installation strategies that ultimately affected the cost of the proj ect. In addition to the overall increases in the cost of the Salt Creek Trunk Sewer there were other factors 7. Cost of Maintenance Vehicle The City will be purchasing a sewer maintenance vehicle capable maintaining the sewer main in its off-road location while being sensitive to surrounding environment of Salt Creek and the Otay Valley. Currently the City does not have one. This vehicle will be used exclusively for the maintenance of these DIF facilities. 8. Reach 9A has also been included as a Salt Creek DIF Facility Reach 9 was divided into 3 sub-reaches, Reaches 9A, 9B and 9B' prior to construction. Reach 9A. The most easterly portion benefits only the Salt Creek Basin and is not considered to be a regional facility. Only Reaches 9B and 9B' can be considered regional facilities. Therefore, only those two reaches are recommended to be financed by the Trunk Sewer Capital Reserve Fund in accordance with the provisions of Section 3.14.010 Update to the Salt Creek Sewer Basin Plan August 2004 16 of the Municipal Code. The cost of Reach 9A, $6,115,322, has been included as a DIF facility. 9. The inclusion of the Wolf Canyon Sewer Facilities as a Salt Creek DIF Facility The Wolf Canyon Facilities, Rock Mountain Road Trunk Sewer and Heritage Road Trunk Sewer, were not originally contemplated in 1994 when the Basin Plan was prepared and is now being included as a covered facility within the DIF. 10. The reduction in the number of remaining benefited projects. Since the DIF was established in 1994, approximately 5,501 EDU's have been completed within the basin. There are approximately 19,191 remaining EDÚ's to pay back the DIF. TABLE 3.1 OVERALL COST INCREASES - 1994 TO 2004 ELEMENTS OF COST INCREASE Cost (Million) Original Overall Cost Estimate (1994) 18.1 1 UnsizinQ" SeQ"Tt1ents 0.5 2a SCADA 0.5 2b Dual PiDeline 1.0 2c Endowment 1.0 3a Increased detJth of sewer and Davement reconstruction 2.0 4 Increased Need for Staff & Consultant Resources 3.1 5 Construction Cost Index (29%) 2.7 6 Intensitv of DeveloDment 2.8 7 Maintenance Vehic1e 0.3 Total Overall Salt Creek to Date (2004) 32.0 Update to the Sail Creek Sewer Basin Plan August 2004 17 4.0 SALT CREEK SEWER BASIN DIF ANALYSIS Methodolo2V The Salt Creek Sewer Basin Development Impact Fee was established on December 6, 1994 by Ordinance No. 2617 and was based on the 1994 Wilson Study. The fee was determined by spreading the cost of the facility amongst the properties within the benefit area. This update utilizes the same methodology. A re-evaluation of the cost of the facilities has been made, and the number of remaining dwelling units has been determined. The revised fee was determined by distributing the revised total cost of the required facilities amongst all the properties within the benefit area. There were five main factors that were determined in the calculation of the DIF, and they are as follows: 1. Remaining EDUs in the Basin Benefited EDU's within Salt Creek Basin Since the completion of the 1994 Wilson Study, the land use within the Salt Creek and Wolf Canyon Sewer Basins has changed considerably. For instance: the 1994 Wilson Study estimated a total of28,737 EDUs within the Salt Creek Sewer Basin; now, having the most current land-use projections of the Eastern Territories, it is estimated that the entire Salt Creek Sewer Basin, including the Wolf Canyon Sewer Basin, will have 31,169 EDUs at build-out. Approximately 5,501 EDU's have already been constructed. The difference in build-out projections results from the fact that when the 1994 Wilson Study was prepared, the projections were based on the approved General Development Plan. Since then, development has proceeded through a more detailed level planning process with several changes taking place. The remaining undeveloped areas also have refined plans that differ considerably from the approved GDP resulting in increased densities. A major component of this 2004 Update is the review of the Sewer Basin boundary for the entire Salt Creek and the update of the remaining number of equivalent dwelling units (EDUs) within the Basin using available information of the construction activity within the Basin since the 1994 Wilson Report was approved. To determine the build-out EDUs within the Salt Creek and Wolf Canyon Basins, sewer studies, improvement plans and the Master Land Use Inventory Table, categorized by Traffic Analysis Zone (T AZ) were used. It is important to note that the updated numbers of ED Us for Wolf and Salt Creek are estimates, since most of the southerly portion of the Salt Creek Sewer Basin and most of Wolf Canyon Sewer Basin are not yet mapped. Appendix J shows the Master Land-Use Inventory table and Exhibit B used to determine the number of ED Us within the Basin. Appendix F shows the tables with the breakdown 17 Update to the Salt Creek Sewer Basin Plan August 2004 of the sewage flows generated within the Salt Creek Sewer Basin and Wolf Canyon Sewer Basin for each Development located within the basin limits. Existing Development Salt Creek Basin After a review of building permits it was determined that as of June 30, 2004 development totaling 5,501 EDU's are completed or under construction within the Salt Creek basin. These EDU's have been excluded from the total number of benefited properties used to determine the new DIF. University Site In determining the remaining EDU's within the Salt Creek Basin, the University Site was given special consideration. Although its ultimate use could change, it is currently estimated that if the site is developed as a university it could generate 5,973 EDU's. Since the university would be part of a State agency and if the entire site developed as a university it is likely that the City will be unable to collect any DIF fees (5,973 EDU's @ $1,330 = $7,944,090). Since revenue generated by the Salt Creek DIF is used to repay the Trunk Sewer Capital Reserve Fund, this amount may not be repaid to the fund. Furthermore, the General Plan Update, which is currently underway, contemplates a possible reconfiguration of the University Land Use along with mixed-use residential/commercial opportunities and possible residential uses for student and/or faculty housing, which could result in more revenue to the DIF. WolfCanvon Basin , No development has occurred in the Wolf Canyon Basin, so no DIF has been collected from this area. However, construction within the basin is expected to start within 1 year. A total of25,668 EDU's (31,169 less 5,501) will be used to determine the DIF payment. Table 4.1 shows the absorption rate for the remaining EDU's in each basin. 2. Project Costs The future cost of the project includes the costs of: construction, engmeenng, environmental, acquisition of right-of-way, legal counsel, construction inspection and administration costs. Salt Creek Gravitv Sewer Interceptor Proi ect The overall project cost based on Table 2.2 and is estimated to be $31,994,076. The DIF's liability is $20,399,716. Update to the Salt Creek Sewer Basin Plan August 2004 18 U) c U) a:J aJ .... Q) 3: Q) en c o >- C a:J () ~ o :5: u c "": a:J "'iI',::e:. 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'" ... ü æ .g, '" en ü .. .c ~ 2 -" 15~ ~Zð :;;;¡ aðl~ CJ ~& ('II(I)vt-- LU .!!! " ~I~ " -' 5 ;~,g ~ ¡pü ;: 5~ 0 555 .!:: I ¡ :ë ~ ! ;; ;¡ J! .. ü .. i :¡¡ LU o ¡: .. j <ri 1i " ~ WolfCanvon Trunk Sewer Proiect The Wolf Canyon Trunk Sewer Facilities are still in the preliminary design stage, so the current construction cost estimate is based on preliminary indications of what the project would ultimately cost. The City may need to update this cost upon completion of the Trunk Line (or should sufficient infonnation indicate that the fee needs earlier adjustment). Table 2.3 shows the most current estimate for this project for $5,716,000. 3. Outstanding Credits Based on the provisions of Sections 15 and 16, of Ordinance No. 2617, a developer who agrees, or is required as a condition of approval of a development permit, to construct a segment of the facilities would be entitled to receive a reimbursement or credit at the City's option. Salt Creek Gravity Sewer Interceptor As mentioned above in Section 3 of this report, Reaches 1, 2A and 2B were constructed by Pacific Bay Homes and the Eastlake Company. From the information provided by the developers, it is estimated that the outstanding credit for Pacific Bay Homes for constructing Reach 1 is approximately $173,613. It is estimated that the Eastlake Company will be credited approximately $112,199 for constructing Reach 2A and $267,660 for Reach 2B. Refer to Table 2.1 for the summary of the costs for the existing Reaches. Wolf Canvon Trunk Sewer Proi ects Since none of the Wolf Canyon Facilities has been constructed, there are currently no outstanding credits for those·facilities. However, in the future, Otay Ranch will construct the Heritage Road Trunk Sewer and will seek reimbursement upon completion of this facility. Also, the McMillin Companies may also seek reimbursements for the costs incurred to date for the preliminary engineering completed on the project, which they funded. It is currently estimated that this amount is approximately $414,000. 4. Other DIF Obligations Salt Creek Gravity Sewer Interceptor Proiect Reaches 4B and SA were constructed by the City, with a loan of $677,700 from the Trunk sewer Capital Reserve Fund. This loan will need to be repaid in the following years. Update to the Salt Creek Sewer Basin PIan August 2004 19 Wolf Canvon Trunk Sewer Proiect There are no other obligations for this project. 5. Available Revenues Salt Creek Gravity Basin DIF Revenues As of June 30, 2004, the City has collected $1,347,094 in DIF fees for the construction of the required facilities. In addition, the fund has earned an additional $1,423,948 in interest both on the fees collected and the loans made to the Fund from the Trunk Sewer Capital Reserve Fund. Table 4.2 shows the amount collected since the inception of the Salt Creek Sewer Basin DIF. . TABLE 4.2 REVENUES COLLECTËD BY THE SALT CREEK SEWER BASIN DIF ($284/EDU) Fiscal Year DIF Payments I nterest Earned 1994/95 $8,633 $14.00 1995/96 $15,904 $654.76 1996/97 $80,258 $3,716.60 1997/98 $71,310 $7,694.21 1998/99 $88,892 $13,719.39 1999/00 $107,011 $18,742.74 2000/01 $161,403 $261,376.27 2001/02 $106,942 $663,957.56 2002103 $280,129 $351,541.31 2003/04* $426,612 $102,531.11 Total $1,347,094 $1,423,947.95 Total Balance Including Interest: $2,771,041.95 * As of 6/30/04 LOANS FROM THE TRUNK SEWER CAPITALFUND TO SALT CREEK DIF INTEREST OWED TO Fiscal Year LOAN AMOUNTS TRUNK SEWER FUND 2000/01 $7,585,500 $219,314.05 2001/02 $1,300,000 $485,677.99 2002103 $2,524,596 $537,178.60 2003/04* $563,527.43 Total $11,410,096 $1,805,698.07 20 Update to the Salt Creek Sewer Basin Plan August 2004 /- 6. Financing Costs The fmancing cost is the total amount of interest due on the amount borrowed to fund the facilities. This is the interest due on the amount to be financed. This takes into consideration revenues earned by the DIF, and interest accrued on funds borrowed from the Trunk Sewer Fund (for detail see Tables 4.3 and 4.4) Revised DIF The new Salt Creek Gravity Basin Development Impact Fee was det=ined by taking the cost of all the required facilities (Reaches 1 through 9A of Salt Creek Trunk Sewer, the Rock Mountain Road Sewer and the Heritage Road Sewer) and spreading it equally amongst the benefiting properties. . Table 4.4 shows the distribution of the funds and how the DIF for the properties within the "Benefit Area" was determined. Based on these the new DIF amount would be $1,330IEDU. Update to the SaIt Creek Sewer Basin PIan August 2004 21 - z o ¡: e( z :E a::: w .... w C .... UJ w a::: w .... z CO') ::. ~~ wUJ ....I~ me( ~z e( > w Z o :E IL o .... 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Î! ~ " 1 .!'.!' " " " " ~ ~ ~ ~ (J (J .E .5 ., " o 0 '" '" .. .. "ii "ii ID m " " ~ £ 'õ Õ " " " '" w w ..... ..... Q Q 88 1:: 1:: = . .!fJ ~- ¡ ~ ¡¡ Co ~ ~ . . ::¡; :::> (J) iIi w ..... o z TABLE 4.4 CALCULATION OF THE SEWER DIF FOR THE SALT CREEK & WOLF CANYON SEWER BASINS (ROCK MOUNTAIN ROAD AND HERITAGE ROAD) INCLUDES REACH 9A REMAINING EDU. IN THE BASIN SALT CREEK SEWER BASIN ESTIMATED TOTAL EDU. IN THE SALT CREEK SEWER BASIN WITHIN BENEFIT AREA 24 692 24,692 EXIS11NG EDU. IN THE SALT = SEWER BASIN (AS OF 6I30I04) 5,501 " " ",' ", 1ŒMA\NJNGEDt1, IN Tal!: SALT CREEK SÉWERIlÀSIN " ':>~: :~I91," WOLF CANYON SEWER SUB-BASIN I . ' ES~'T.qrAL-J;DUdN-T;aEWO:tF C:ANYON$WJ!RB~ -'/.' , ,'""'L,,,,': 'I 6,477 BIMd em Geocml P!In t"orwoJ!Cmyon ,;~ Total Basin TOTAL NUMBER OF EDUS EDU'. "~',., 'ESTIMATED TOTALEDUOIN THE SALTC\Œ!!K & WOLl' CANYON SEWER BASJN5' ','/.'2$.6$ 31,169 PROJEcr COST (P<rim Conmuctcd by GIy) SALT CREEK GRAVITY SEWER INTERCEPTORPROJEcr COST REACH 3 REACH ¡¡r REACH SB T REACH 6 I REACH 7 REACH SA REACH SB REACH 9A I TOTAL $1 WI07"" 921 27IT S¡"¡¡¡¡S95] S973 024 ] S3 n? m SI ii¡'-95. , $1 89~ 193 115322 519 168 44 ROCK MTN. RD. & HERITAGE RD. TRUNK SEWER ESTIMATED FUTURE PROJEcr COST I ESTIMATED COST OF ROCKMTN. RD. TRUNK SEWERfSl.oøø.JDINOW;S3,-t4iO.....nTnJIŒ) $ 4 460 000.00 s ~"".ooo.ool $1.000 000 ESTIMATED COST OF HERITAGE ROAD TRUNK SEWER (DEVELOPER CREDIT) S 1.256,000.00 ESTIMATED TOTAL CONSTRUCTION COST (WOLF CANYON SYS~ S 5716000.00 FUT1JRE I NOW rTOTAL CITY FUNDED PROJECTS 523,628,544 I $10,168,544 OTHERDIF OBUGATIONS (Podion C-.¡ by Odma) I ] SALT CREEK GRAVITY SEWER INTERCEPTOR I ! , I AGENCY REA AMOUNT I I , I LOAN FROM THE TRUNK SEWER. FUND 4B $390 421 , ! LOAN FROM THE TRUNK SEWER FUND SA $287,278 , ] OTBERDIF OBLIGATIONS $677 100 I $677,7001 ¡TOTAL CITY FUNDED PROJECTS (Tata1 AmoumtobeFiIianccd)- AVAILABLE REVENUE SALT CREEK GRAVITY SEWER BASIN DIF IFUND 553) DIF FEES PAID' SI "'7 094 I + S1423 947.95 IT",....., 'OWED ro'l'R'UNlè'sEwmACCQUNT IlNANCING COSTS SALT CREEK AND WOLF CANYON TRUNK SEWER PROJEcr FINANCING COST $ZO,I68,544 + $677,700 $2,771,042 + $1,805.698 $19,880,9(10 INTEREST ON 519.880,900 -I. FOR 15 YEARS -....1 I $20.846.2441 I I ! , I I 'Sl,BO$;698 I .., 77' 041.'" I ! I - T-:ZiB~ used to Calcu1a:tc: Interest ------------------ OUTSTANDING CREDITS (portion Coosttucted by Odma) SALT CREEK GRAVITY SEWER INTERCEPTOR DEVELOPER REACH CREDIT McMIU.IN (pACIFIC BAY HOMES) 1 SI73,613 EASTI.AKE COMPANY 2A SI l' 199 EASTI.AKE COMPANY 2B $267,660 , $1,256,000 TOTAL OF OUTSTANDING CREDITS S$$3 472 I $553,472 TOTAL FUNDED BY DEVELOPER CREDITS Sl,B09,472 NEWDIF = FUTURE PROJECT COSTS + OTHER DIF OBLIGATIONS A V AtLA.BLE REVENUE + S19,168,544 Sé77.700 lli1.m TotalDIF Liabili , $20,399,716 CALCULATION OF THE DIF + OUfSTANDING CREDITS REMAINING EDUI IN THE BOrn BASINS DIF - $23,628,544 + 5677,700 51,771,042 + ~ + :'$1.805;.69&, + 15.668--. t·,---,": \~,:):ii',; ;:;,:\~\,¡'::,'i·;~!1¡; "":;' ;r:,' _~'~;:: X >{;\/¡"~'" ~'z;i'ç' $1.80',472 ~ " ",' .: >' - il,\h~. ,."0 ,'i;_".,;. ~"'~1)Drp~"!I¡,j¡í1fr~f"~ÌJ¡'\iW1 ,'r;~~~;!í,I!~·l~_"",;;,"e>.\'~~~~~f~,t~ J:'lENGlNEER\SEWERUOO1\SAL.T CREEK PIF\Fn s.c. & W.C. E¡,H:Ib & CaII.JdiI; (1IaIoiMd Table ".211) '''''''''''') 5.0 FINANCIAL ANALYSIS EDV Conversion Factors For fmancial analysis, the land-uses for each property are converted to Equivalent Dwelling Units (EDUs). Table 5.1 shows the EDU conversion factors for fmancial analysis, based on the sewage flow rate of265 gallons per day, as established in the City ofChula Vista's Subdivision Manual. Residential - SFD Residential- MFD Commercia1lIndustrial Hi School Junior Hi School Element Park CPF gpd: galIon per day SFD: single-family dwelling 1.00IDU O.75/DU 9.43/acre O.08/student O.08/student 0.06/ student 1. 89/acre 9.43/acre CPF: connnunity-purpose faciIity Construction Fundinl! Salt Creek Gravity Sewer Interceptor The construction of the Salt Creek Gravity Sewer Interceptor was funded utilizing two funding sources: the Trunk Sewer Capital Reserve Fund and the Salt Creek Gravity Basin DIF. Upon the approval of Ordinance No. 2617, Council determined that Reaches 1 through 8 would be funded by the DIF while Reach 9 would be considered a regional facility and would be funded utilizing Trunk Sewer Capital Reserve Funds. Trunk Sewer Capital Reserve Funds are derived from sewer capacity fees paid by all new connections regardless of the Basin to which they are tributary. In 1997, the City constructed portions of reaches 4 and 5 (referred to in this report as reaches 4B and SA) as a joint project with the San Diego Gas & Electric Company (SDG&E). SDG&E's project was within the same alignment corridor, and the City used the opportunity to facilitate the construction of that portion of the pipeline. Although that portion was supposed to be funded utilizing DIF funds, since the DIF had not collected sufficient funds, it was funded utilizing a loan from the Trunk Sewer Capital Reserve Fund. Subsequently, in FY2000/01, FY2001l02 and FY2002/03 the City funded the remaining DIF eligible reaches (3 through 9A) (SW-219) using a combination of accumulated revenue in the Salt Creek DIF and with additional loans from the Trunk Sewer Capital Reserve Fund. The DIF will 22 Update to the Salt Creek Sewer Basin Plan August 2004 be re-structured such that these loans are repaid over a IS-year period. Table 5.2 shows funding for the project and the funding sources. Table 4.3 shows how the loans will be repaid over the 15- year life of the loans. TABLE 5.2 PROJECT FUNDING SUMMARY Total Amount Originally Funded as City Obligation Using Trunk Sewer Capital Reserve Funds Approved Trunk Sewer Capital Reserve Funds FY/OOIOI $ 7,289,500 Approved Trunk Sewer Capital Reserve Funds FY/OI/02 $ 1,300,000 Approved Trunk Sewer Capital Reserve Funds FY 02/03 $10,182,824 Subtotal $18,772,324 Total Originally Funded as a Loan From Trunk Sewer to Salt Creek DIF Approved Loan From Trunk Sewer to DIP (R4B & RSA) FY96/97 (SW210) Approved Loan From Trunk Sewer to DIP (RJ, 4A, 5B, 6,7,8) FYOOIOI(SW219) Approved Loan From Trunk Sewer to DIP (RJ, 4A, 5B, 6,7,8) FYOl/02 (SW219) Approved Loan From Trunk Sewer to DIP (RJ, 4A, 5B, 6,7,8) FY02/03 (SW219) Subtotal $ 677,700 $7,585,500 $1,300,000 $2,524,595 $12,087,795 Total Amount Funded from tbe Salt Creek Gravity Basin DIF Approved Funding From Salt Creek DIP (RJ, 4A, 5B, 6,7,8) FY 02/03 Approved Funding From Salt Creek DIP (RJ, 4A, 5B, 6,7,8) FY 02/03 Subtotal $ 525,000 $ 850,000 $1,375,000 Wolf Canvon Trunk Sewer The Wolf Canyon Trunk Sewer is being funded utilizing two funding sources: loan from the Trunk Sewer Capital reserve Fund and/or loans from other sources that fund the construction of public facilities (i.e. State Revolving Loan Fund (SRF) or Bond Pool). For the purposes of establishing the DIF, an interest rate has been assumed based on prevailing rates. Total Amount Originally Funded with a loan From tbe Trunk Sewer Fund Approved Loan From Trunk Sewer to DIP (Wolf Canyon) FY03/04 (SW225) Subtotal $ ],000,000 $1,000,000 Also, since the inception of the project, McMillin Companies has funded approximately $414,000 for consultant and staff services to date on this project. This cost is currently included in the overall project cost for the Rock Mountain Road Sewer project. Update to the Salt Creek Sewer Basin Plan August 2004 23 6.0 CONCLUSIONS AND RECOMMENDATIONS Based on the analysis done for this report, staff recommends the following rnodifications to the Salt Creek DIF: · That the list of covered facilities be rnodified to include: (a) Reaches 1,2,3,4,5,6,7,8, and 9A of the Salt Creek Gravity Sewer Interceptor. (b) Wolf canyon Sewer Facilities (Rock Mountain Road Sewer and Heritage Road Sewer) That the Salt Creek Diffbe increased from $284 per EDU to $1,330 per EDU. (J:lEngineer\SewerI2001 \SALT CREEK DffiFinal s.C. DIF Reportlnew S.c. DIF Report.dnc) Last printed 0810212004 II :54 AM Update to the Sail Creek Sewer Basin Plan August 2004 24 , "~ I _J