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HomeMy WebLinkAboutcc min 1992/08/26 SPECIAL JOINT MEETING OF THE CHULA VISTA CITY COUNCIL AND THE OTAY WATER DISTRICT BOARD OF DIRECTORS Wednesday, August 26, 1992 District Conference Room 3:16 p.m. Spring Valley CALL TO ORDER President Hilton welcomed the members of the Chula Vista City Council and Staff. 1. ROIL CALL: Council Present: Councilmembers Horton, Malcolm, Moore, Rindone, and Mayor Nader City Staff: Assistant City Manager Morris, Deputy City Manager Krempl, Public Works Director Lippitt, City Attorney Boogaard, and City Clerk Authelet Directors Present: Haden, H~ton, Mulcahy, and Watton. Directors Absent: Laudnet OtaySraff: General Manager Lewinger, Operations Department Head Przybylski, Finance Department Head Chambers, Attorney Hatton, and District Secretary Bartlett-May ORAL COMMUNICATIONS President Hilton inquired if anyone in the audience desired to address the Board on any item nor on the agenda. No one wished to be heard. BUSINESS General Manager Lewinger stated discussions have been held between the City and Otay since December, 1991 regarding facilities that the District has planned in its draft master plan to provide service to the existing and future citizens of Chula Vista. Some of the concerns expressed by City Staff revolve around storage facilities and the cost of facilities. The District's planning goals are to develop a master plan that includes a long-range picture for 20 to 50 years and will integrate what used to be three separate areas of the District. These were the North, Central, and South areas. The master plan has shown that over time as development occurs, the North will be tied to the Central Area by a pipeline in Proctor Valley Road, and the South will be tied to the Central Area by a pipeline on the wet side of Brown Field as well as a pipeline from the Olympic Training Center area to the Donovan prison area. This will integrate all the systems and should eliminate the perception of piecemeal planning. The master plan will also maintain flexibility to provide for reaction to changes in conditions which may affect the size of ultimate facilities, such as peaking factors, effects of water conservation, and the impact of using more reclaimed water. By building facilities as they are needed based on the conditions in place at that time, the District would not be building too much facility for what might change in the future. One type of storage facility the District builds are the smaller tanks within service zones to meet operational demand. The demand in the neighborhood such as EastLake varies over the day with peak demands typically in the morning and evening. The supply of water from the County Water Authority (CWA), however, must be taken at a constant rate. The District must make up the difference between the rate water is taken from CWA and the District's demand through storage. When the demand drops below the rate water is taken from CWA, the tanks are filled. The difference in these numbers represents the volume of storage necessary to equalize the demand in a zone. Mr. Lewinger displayed a schematic of a sample tank including operational storage which typically amounts to about one-third of a maximum day plus fire storage Minutes August 26, 1992 Page 2 capacity and emergency capacity for emergencies such as pipeline breaks. A peak day's worth of storage is maintained in the operational reservoirs in case of main breaks where a zone would have to be served without service from the CWA. The District is trying to develop facilities to meet the CWA policy for larger emergencies such as aqueduct breaks or earthquakes. The Metropolitan Water District is trying to develop a reservoir near Hemet so that they will have six months of water storage below San Bernardino, and the County Water Authority wants two months below San Luis Rey. Otay has been told by the County Water Authority to be prepared to sustain deliveries to its customers for ten days without service from CWA. This is where the Districes criteria for ten days of emergency storage is derived. The Board's policy as recommended by staff is to have five days of this storage in treated water reservoirs owned by the District and another five days in the least costly alternative which is considered to be leasing capacity in the Lower Otay Reservoirs. The first five days already includes the 2.3 days in the emergency storage in the operational tanks. The 2.3 days is used as the peaking factor in Chula Vista to determine how much water is used on a peak day versus an average day and is based on actual experience. In other areas of the District the factor is closer to 3 or 4 while the City of San Diego's actual peaking factor for their system is 1.7. This factor is very dependent on weather. Mr. Lewinger explained why the District chose five days of covered storage and five days of another type of storage. The District looked at the type of emergency it wanted to be prepared for and concluded that it should be prepared for an earthquake. The District felt it was important to be able to provide the customers with drinking water and sufficient water to fight fires after an eaghquake. After a severe earthquake there would be multiple pipeline breaks among the water agencies. After the Sylmar quake in 1971, the City of Los Angeles experienced more than 150 pipeline breaks in that area. None of the water agencies keep enough material on hand to repair that many breaks. The district uses a nationwide criteria which is also followed by Chula Vista's fire department which will supply water to fight a fire for five hours. The sum ) total of the fire storage in the five sendce zones in Chula Vista is 7.5 million gallons for five hours. There will very possibly be more than five or ten hours of fire fighting after an earthquake. Between the fire fighting and the leaks in the pipelines, almost all of the 2.3 days of emergency storage will be used on the first day after the earthquake. The 2.7 days of emergency storage facilities will be all that will be remaining, and it is reasonable to expect that help from the City of San Diego will not be immediately available as they will be having pipeline and treatment plant breaks and power shortages to cope with before they could provide water to the District. The total of the 2.3 days of emergency storage in the operational tanks and the 2.7 days in the emergency storage facilities is the five days the District uses in its criteria. This is a reasonable number based on the District staffs experience in the water business and weighed against the cost of building the facilities. Mr. Lewinger stated there were several different ways of supplying the second five days of emergency storage, and the District is not set on any one way except that it should be the least costly alternative. Staff considers the least expensive to be an arrangement with the City of San Diego and that staff is currently negotiating with the City. Staff will also consider outright purchase or building new capacity at Lower Otay and leasing or purchasing capacity in the lake, building a District-owned treaunent plant to either treat water directly out of the CWA aqueduct or in conjunction with a new open reservoir and developing groundwater and desalination. If all of these alternatives fail, the District could build storage tanks to store treated water, but the District wants to do whatever is least costly for the residents of Chula Vista and the Districfs ratepayers. If none of the other alternatives work and building storage tanks was the Districes available source of emergency storage, 100 acres more that the District currently owns would be necessary. The 50 acres purchased from Baldwin, along with the property on Easflake Parkway and the small operational tanks, are enough for five days of storage; but to protect the District, it is felt that it would be prudent to work with City staff to identify sites for days 6 through 10 so they do not get developed before a decision is made. If the District is able to develop a less costly alternative for days 6 through 10, the sites could be released. ) Councilmember Malcolm inquired if there was a reason the sites should all be in Chula Vista. Minutes August 26, 1992 Page 3 General Manager Lewinger stated they do not have to be in Chula Vista, and the master plan identifies sites in Otay Mesa, the Baldwin property, and in Proctor Valley. Attorney Hatcon pointed out that the closer to the area of need, the more reliable the service; and the District is limited by elevations to provide for gravity flow. General Manger Lewinger stated the Districes master plan needs to be re-evaluated as the City re-evaluates its general plan. Mr. Lewinger discussed how the District intends to finance these facilities. The Chula Vista Staff was concerned that the price tag for all the fac~ities in the master plan was hundreds of m~lions of dollars. This is true, but new development will have to pay its own way and existing customers should pay for replacement or betterment facilities. The District does not want to place the burden on existing residents to build facilities to serve future customers. The Districes improvement district in this area has bonding authority, but the Districes Board has a self-imposed limit of $0.10 per $100 assessed valuation. Developers have informed staff that a 2% tax rate is the limit for new housing. With 1% of that being the general propetty tax, that leaves 1% for financing of remaining services. Of that 1%, the District would take a maximum of $200 per year on a $200,000 home leaving the City and other services with $1800. Attomey HaTcon stated the District gets as much bonding authority as possible, but its not just to bu~d the original facilities to serve the development but for future improvements also. General Manager Lewinger stated the funds needed for capital facilities are funded through two sources of revenue: bond debt repaid through taxes and connection fees, and developer funded. Counc~member Malcolm inquired how the District would fund facilities in an area that was built out. General Manager Lewinger stated if an area is bu~t out, the District should not need new fac~ities. Counc~member Malcolm stated there are a lot of built out areas that do not have five days. General Manger Lewinger stated in built out areas without five days, the District would consider the fac~ity a betterment project and would fund it through standby charges and availability charges. Existing customers would pay for the porEion of the five days emergency storage benefitring them, and new development would pay for their share. If the $0.10 tax rate will not pay for the new development's share of the facility, the developers must come up with cash to build the facility. The 30 mg reservoir to be built on Easflake Parkway will cost between $14 and $17 million dollars but the District will not sell bonds for that amount and so the developers have an agreement with the District whereby their cash participation is $14 million. To cover the design and the construction management for this reservoir, the District may have to sell $5 million dollars worth of bonds which should result in a tax rate of $0.05 or $0.06. Any development not participating would have to pay $1,800 per home as their share of the reservoir costs. General Manager Lewinger stated as far as water rates, the Districes rates for 95% of its customers are lower than Helix and Sweetwater Authority. The Districes monthly service charge is comparable to both agencies also. Councilmember Malcolm stated the City staff is saying differently. Chula Vista's Director of Public Works Lippitt stated the cost of water service in Otay is higher when all the other charges such as the capital facilities costs are added. General Manager Lewinger stated that would not be comparing apples to apples because the older home in Chula Vista at some time in the past would have paid for their capital facilities. The new home should pay its fair share of the facilities necessary to provide service. Those costs cannot be charged to the existing customers in Chula Vista. M/nutes August 26, 1992 Page 4 Mayor Nader inquired of his staff how the water cost to an older home in Chula Vista would compare between Sweetwater Authority and Otay. Mr. Lippitt stated that the homes in Otay are in improvement districts and haven't used assessment district f'mancing. Most of the cost in the older homes, if there are any costs, obviously the pipes in front of the house are always paid by the developer, are included in the price of the house. He was talking more about the backbone facilities that the original developers and the District paid for. EastLake and some of the new developers have put facilities in, and in fact, the City built a tank through a street assessment district. Director Watton stated out of fairness to Helix and Sweetwater, their rates are higher because they have older systems and they are funding a lot of their replacement out of their annual budget. A few years ago San Miguel Partners compared developing their project in Sweetwater Authority versus Otay and found the costs to be almost the same. Mayor Nader stated he still had not heard an answer to his question. He thought the Council had been told that when a number of fees, taxes, etc. were added on top of the basic water rate, Otay was a great deal more than Sweetwater and he inquired of his staff if the cost to the new homes is put aside, is that true. Mr. Lippitt stated if the tax amount is not included, the Otay bill would be a lot less. Mayor Nader inquired what taxes an older home would pay. Mr. Lippitt responded that was not known. General Manager Lowingot stated that Improvement District 22 where Councilmember Malcolm resides, the tax rate for a $200,000 home would amount to about $809 a year and will be 0 in five years. Mayor Nader inquired if the tax is the only other charge besides the basic monthly charge that his staff included in their figures. Mr. Lippitt said that was the only other charge. Director Watton stated the tax is not a monthly fee, and City staff should be looking at the monthly cost to the homeowner. Councilmember Malcolm stated their staff had indicated that Otay~s water rate was cheaper, but there are a lot of hidden charges when in fact Otay is saying if a home is older there are no other charges, just the cost to the new homes for the necessary facilities. General Manager Lewinger stated there were some goals he hoped to accomplish at today's meeting. The most important one was for the two agencies to reach a consensus that his description of the District's policies and goals regarding providing storage for an emergency is reasonable and that five days is not an overly conservative amount and that days 6 through 10 should be provided by whatever is the least costly alternative. The second goal is to provide for coordinated planning between the two agencies, especially regarding the potential siting of reservoirs for days 6 through 10. He proposed that if this can be done, that before any construction is done on the Baldwin site, the District would do an EIR. An EIR would also be done before the District formally adopted its master plan. He hoped that Chula Vista could include the reservoir sites for days 6 through 10 in its general plan and create a "holding" zone for those sites until the District determines what the least cost alternative armally is and if it isn't tanks, those sites can be released. He suggested the best way to accomplish all of this, if a consensus is reached, is to use the Interagency Task Force who could oversee the implementation of these goals. Councilmember Malcolm stated if he understood so far, the District would agree that prior to construction of the site purchased from Baldwin, an EIR would be done and that prior to adoption of a master plan, an EIR would be completed. Minutes August 26, 1992 Page 5 General Manager Lewinger stated the District has agreed to do this. Councilmember Malcolm asked, ff the attonaeys can put an agreement together, would there be a problem? Assistant City Manager Morris stated City staff would like to make a presentation. Staff agrees that discussion has been going on since December and pat~ of the process has been to get the issues on the table. Both agencies have been going through a protracted process of doing that with an exchange of letters raising, responding, and identifying new issues. The majority of issues have probably been identified that are of a concern to the City. The City saw movement on Otay's part in terms of its initial proposal versus what it has now, regarding the move down to five days covered storage versus the original position. City staff still has concerns, and he is not certain that the City is ready to reach consensus that five days is appropriate. Staffs position might be that maybe this meeting would be the impetus for future meetings between the two staffs on these issues. Councilmember Malcolm inquired if it was possible for the City to deal with the issue of the lawsuit before getting into whether five days is appropriate or not. He inquired what else City staff would want Otay to agree to. Assistant City Manager Morris stated he heard Mr. Lewinger indicate Otay still needs the five days, and City staff still has questions on that. Mr. Lippitt inquired what the City's position would be as far as moving on ff the City is satisfied with Otay's agreement to perform the environmental work on the master plan and the site. City Attorney Boogaard explained that the lawsuit is based on two premises: that the District should have done environmental review before purchasing the land, and Otay should submit their public works projects to the City for review by the City's Planning Deparmaent to determine consistency with the City's general plan. The fundamental premise that has brought about these discussions is that the City Public Works Department is not convinced that a proper planning approach has been utilized in determining the five-five split for storage. He was advised by that Department that there should be some risk assessment to determine what the split should be between covered versus open storage before entering into a decision to buy land. That risk assessment should contribute to a master water plan; after the draft master water plan is prepared, an environmental impact report should be engaged in. Then the purchase of land necessary to meet the original risk assessment. He said this process has been reversed in this case; the land has been purchased first before any risk assessment, final master plan, or environmental impact report has been done. Councilman Moore stated now that they understand Otay's side, he would like Otay to understand the Citys side. The City as a multi-purpose agency always expects a draft master plan and a draft EIR to be done. The CEQA rule says 'thou shall,' and he personally waits for that so that the City can review the documents and return it with their concerns. If they do not receive these documents or the District disagrees with the concerns, then a lawsuit is formed for the purpose of forcing people to review the concerns of the other parties. His concern is that he has not had an opportunity to review a draft master plan or draft EIR. He has seen a master plan, but it did not say draft, nor did it have a date. Attorney Harron stated that a draft master plan was sent to the City in November of last year, and City staff has commented. As a result of the comments, some changes were made by the District. The most important change was in the underground storage for days 6 through 10 which now provides that the District will look for the least expensive alternative. Councilmember Moore is correct regarding the EIR on the master plan. The District has been trying to decide what the project is before an EIR is commenced. The project now will include some of the changes recommended by City staff that Otay has agreed to; that is why there is no EIR today. Councilmember Moore stated that was his primary concern, but his second concern is what happens to the property owners in Chula Vista if the cost of all the utilities and services exceeds the 2% tax limit. Minutes August 26, 1992 Page 6 Attorney Harron responded the developers have informed the District that they cannot market homes with more than the 2%. Councilmember Moore inquired if any other agency could assess the property owner in this manner. Attorney Harron stated that could not be done unless the developer or their successors supported the assessment. General Manager Lewinger stated a developer would not support an assessment district if it increased the tax bill beyond the 2% because the developer would not be able to sell the homes. Councilmember Moore stated these things should have been worked out by the two staffs and brought forward to the two policy groups; but these are his two concerns. Mayor Nader inquired if Mr. Lippitt could make a presentation that would be keyed specifically to whatever issues might be outstanding regarding the lawsuit. Mr. Lippitt stated he had a presentation that would speak to some of the City stales concerns also. Otay has been giving the City extensions on the time limit for filing the lawsuit, but he understood that Otay had decided not to grant any further extensions a~er September and so this meeting was called. He felt there had been progress made between the two staffs, but there is still a need for further discussion of some of the issues. City staff members are not experts in the water field so they hired a consultant to help them; they also looked at other agencies' policies. This was not done necessarily to just critique Otay's planning but because the City has their concerns with multi-millions of dollars of improvements they have to build in order to serve their area. In that there is $226,000,000 that Otay is proposing to build District-wide before the year 2000. All of these facilities must be financed out of the tax rate or the price of the home. When the District purchased the 57 acres, the whole thing became urgent and that was when the lawsuit was discussed. When City staff reviewed the master plan, they saw that $118,000,000 was estimated for terminal storage and $50,000,000 for operation storage. The 57 acre parcel purchased from Baldwin is for approximately 90 million gallons with 30 million gallons being built for EastLake. Bvery day of storage in concrete reservoirs costs approximately $30,000,000 when built out. That relates in the master plan to an average day use of about 76 million gallons. Bven though the two staffs are down to two or three days still under discussion, that is still $80 to $90 million dollars and that amount is still worth talking about. One other area that staff had concerns with is the peak factor which is 1.4 in Sweetwater Authority and Otay's master plan tame 4-2 indicates Otay's Central Area maximuna day to the average annual day ratio is 1.7 or 1.6. he stated he understands it is hotter in Otay's area, but he is wondering if Otay's factor of 2.2 is a litde high and maybe a lot of facilities could be reduced in cost if that factor was more realistically based on the t~ends. TaMe 4-1 indicates the trend is tending to go down especially when water reclamation and other things impact the peaking factor. City staff believes Otay should adopt a policy on storage, ~nalize the master plan, determine locations, perform the environmental study, and then purchase the land. That is not the way the process has occurred, but maybe there is a way through agreements that the City can be satisfied legally. The City does not know ff the five days is the correct number of days for covered storage and is concerned that the rest of the five days is centrally located around the aqueduct near BastLake High School and is not spread out enough. An engineering firm could probably look at the risk analysis and look at the standards throughout the area and come up with a number. The City feels, based on an expenditure of $80 million dollars, it would be worth spending $40,000 or $50,000 to perform a study like this. The City is also concerned with the cost to the homeowners for the different alternatives, and he understands Otay has looked at this but only from the taxes standpoint, not the total cost including the cost of the home and other assessment and improvement districts. The City also feels Otay should complete its negotiations with San Diego and/or Sweetwater Authority and find out what those costs would be and then finalize the master plan with a financial plan to tie in the entire burden including the City's needs. The City understands that Otay must meet certain safety standards and other requirements and policies. He does not think the two staffs are far apart on agreement but are only arguing about a few days. General Manager Lewinger stated he and his staff are professionals in the water business with 20 to 30 years experience, and the City has professionals advising on health and safety issues such as fire service. The City Minutes August 26, 1992 Page 7 has certain criteria on response time for Fare service as well as police service. Just as it is very difficult for the City to determine the value of providing a five minute response time in lieu of a six minute response time, a study is not done, the City looks to its professionals to determine what is acceptable from a risk standpoint. Assistant City Manager Morris stated before that example is used, he would like to point out that a study was done in a fire station master plan siting using consultants and staff to analyze that entire issue. Councilmember Malcolm stated it was not a good example, but it was understood where Mr. Lewinger was heading. General Manager Lewinger stated he tried to lay out a reasonable scenario that the District is trying to protect against which is similar to insurance where some people live on the edge and don't carry a lot of insurance and some want to be safe and pay the extra cost. Councilmember Malcolm stated he agreed but he had no idea what the assessment would be for four days versus five days. He would like to be educated on this. General Manager Lewinger stated the District has not done a risk analysis as requested by the City staff, but the Districes goal is to not run out of water under a plausible set of circumstances. Mr. Lippitt is correct that the master plan indicates a huge amount of money for storage. However, under the revised guidelines once the 30 million gallon EastLake Reservoir is constructed. If development continues at the current pace, additional storage would not be necessary until after the year 2000. The majority of that money was to build the second five days of tanks which will not be built if a cheaper alternative is available. Regarding the issue of the peaking factor and Mr. Lippites comraent that if a lower peaklng factor was used, smaller facilities could be built. The District cannot pick a peaking factor; it must use the factor that exists which is 2.3 in Chula Vista. The figures in table 4-1 are monthly peaking to average ratios which are much lower than maximum day. There is a trend to peaking factors getting lower, but the District is looking at a fifty year planning horizon. The other thing to remember is assuming five days of emergency storage, if the 2.3 peaking factor becomes 1.7, the District still needs five days. Whatever is taken out of operational tanks must be put in the terminal storage tanks to achieve the five days. Tanks have to be sized for each zone, and there are five zones in Chula Vista. The smaller the zone, the larger the peaking factor because the larger the population, the smoother the curve. The operational tanks in each zone are sized using the peaking factor. Whatever portion of the five day emergency storage is not in the operational reservoir needs to be in the emergency reservoir. The emergency storage in the operational tanks is counted toward the needed area-wide emergency storage. Director Watton stated the Districes preference was to have the emergency storage located in the operational tanks to improve response time. Councilmember Malcolm inquired what peaking factors have to do with the emergency storage. General Manager Lewinger stated peaking factors have nothing to do with the emergency storage but are used to design the other facilities such as pipeline and pump stations. The point is that the peaking factor is what it is and is not a made-up number. Fir. Lippitt stated he would think the District would want all of its storage in the operational tanks spread around the District. D/rector Watton stated that would be even more expensive. Assistant City Manager Morris stated it is apparent from this discussion that there are still a lot of issues to discuss. The City staff is not prepared to recommend to the Council that five days is appropriate, and they have concerns about turning this over to the Interagency Task Force. A better scenario might be to have the two staffs meet to discuss the issues further and bring a final report back to the respective Boards. Minutes August 26, 1992 Page 8 Councilmember Moore stated it seems to him that our combined goals are to pursue the open and closed storage days of five/five with a goal to reduce closed storage. If closed storage is reduced, the next area is to combine the above costs to the combined constituents with both agencies trying for a lower minimal cost. If a minimal cost is achieved, more money is released for infrastructure; the cost to the constituency is lowered. Another goal is to pursue sites for closed storage and pursue an EIR to fruition. If the agencies could come to an agreement on this type of verbage, the two staffs could work together and keep the policy makers advised. Mayor Nader inquired if there was any inconsistency between Mr. Lewinge~s presentation and Councilmember Moore's statement, and did Otay leave anything out that were still concerns of city staff regarding the lawsuit that still needs to be resolved. Attorney Boogaard stated he would like to advise the Council in closed session. Mayor Nader stated he heard nothing in the Otay presentation that sounded wrong with the exception of the five days of covered storage, and he doesn't know that it is wrong. If City staff still has qualms, he would like to hear what the attorney has to say in closed session before making any commitments. On of the concerns he has is that the citizens of Chula Vista be efficiently served. While he is not an expert in the water field, he does have to listen to any concerns expressed by staff. He does feel there needs to be more closer coordination of planning between the staffs. Director Mulcahy stated it was the Otay Board's concerns that there was enough water to serve its constituents. Councilmember Moore stated the District does have some flexibility in what it can do with conservation and restrictions. Mayor Nader stated there was no action that could be taken today, but there is need for further discussion on the city's part, and he would like to bring the meeting to a close. Attorney Harron stated he would like to reach agreement to use the Interagency Task Force to provide status reports because one of the reasons the Otay Board stopped extending the statute of limitations is that it was felt the City was being unresponsive. Mayor Nader stated he saw no reason not to use the Task Force. Assistant City Manager Morris stated staff did not disagree to the Task Force's use for that purpose, but they did not want it to be a decision-maldng body. Councilmember Moore stated some type of time line should be used to keep everyone's feet to the fire. Director Watton stated there are really two issues that will not be resolved today, but he would like closure on them quickly: that is the lawsuit and the reservoir site. Either this is going to be worked out, or the city is going to ~e the suit. Otay does not want a suit to be filed because that doesn't look good for anybody and is kind of stupid because its usually realized that it could have been worked out. If agreeing to an EIR process before concrete is poured is a way to do that, fme; but we do need to come to terms on that. The two agencies should continue the planning and better coordination which is a must without cornpromising the delivery of services on either side. Debate can be held on the size of water facilities or the size of streets but the coordinated planning effort is what is important not arguing over four versus five days. The bottom line for him on the development issue, whether financing is provided through bonding or capacity fees, the District is going to have a certain level of service necessary for health and safety, and the City will have certain levels for the services they are concerned with. Either the development supports that in the market, place or it doesn't. If it does support it, you move forward; and if it doesn't, then does the agency go back and reduce the level of service until it works? That is where the coordination and the planning comes in, and the location of sites and the master plan and general plan is where it gets more mechanical and technical. les important for the staffs to have a better relationship than in the past and not because it hasn't Minutes August ;26, 1992 Page 9 been available, but because it hasn't been needed. Both agencies have been going about their business, but now in the current economic times, it has become much more critical. The lawsuit and the EIR issues need to be dealt with immediately, and the staffs should get together and coordinate the other issues on an on- going year-altar-year basis, particularly when Otay Ranch begins. Councilmember Moore stated to settle the lawsuit issue, shouldn't the party who failed to meet a CEQA item make the tirst move. Director Hilton inquired if the City performs CEQA on every project or approval of purchase before it comes before the Council. Councilmember Moore stated if a certain level of construction in an area where there are mutual government entities, certain things must be done. Director Warren stated to answer Mr. Moore's question, the District has already stated an EIR would be done before the site is developed. Councilmember Moore asked ff the District would put that in writing. Director Warren stated the District would. General Manager hewinger stated that had already been put in writing. Councilmember Malcolm stated the City Council has been given a set of facts that is a little different from their stales presentation, and staff needs to look at the issues again. The things every one of the goals outlined by General Manager Lewinger are exactly the same as the City's such as low price, quality service, and enough water for emergencies. He did not want the District to tell the City how to run the police department, and he does not want the City to tell Otay what is proper for water issues. The City is concerned that proper zoning and proper planning be done in the placement of these facilities and how it affects the City's circulation, housing and infrastructure. Hopefully, the agencies can use the Task Force to get reports to both agencies. Director Haden stated the District had no intention of trying to bypass CEQA, but the property came up and the District needed it. Attorney Harron stated a negative declaration was done at the time. Councilmember Herton asked for a response to the comment that the property came up, and the District had to act on it. Attorney Hatton stated what happened was that Baldwin was in difficult financial straights, and the District had been looking at the property for a long time and were able to get a very good deal. Councilmember Herton stated the District had identified it prior to Baldwin coming to the District and making the offer. Attorney Hatton stated that was correct. It was an opportunity the District did not want to miss. He checked to see if there would be opposition to the preparation era negative declaration, but as he has since learned, Tony Letteri, the person he called was the wrong person to talk to, and the District found out at the last second that the City was very much opposed to the negative declaration instead of a EIR. At that point the District was in a time bind. Part of the EIR will be an alternatives analysis and if something else makes more sense and is more feasible then that would become the project. Minutes August 26, 1992 Page 10 ADJODRNMENT President Hilton inquired if there were any other comments. There were none, and he thanked everyone for attending the meeting. With no further business to come before the joint Board and Council, the meeting was adjourned at 5:01 p.m. Respectfully submitted, i] /" Beverly A~ Authelet, CMC City Clerk NOTE: Minutes were taken by Donna Bartlett-May, Secretary to Otay Water District Board of Directors, and submitted to the Cit~ Council for approval. They have been retyped onto our minute paper. I MINUTES OF THE CHULA VISTA CITY COUNCIL AND 2 OTAY WATER DISTRICT BOARD OF DIRECTORS JOINT MEETING 3 AUGUST 26, 1992 4 1. The meeting was called to order by otay Water S 6 District President Hilton at 3:16 p.m. in the District Boardroom, 10595 Jamacha Boulevard, spring Valley, Cali- 7 fornia. 8 9 OTAY DIRECTORS PRESENT: Hilton, Haden, Mulcahy, and Watton 10 OTAY DIRECTORS ABSENT: Laudner 11 12 OTAY STAFF PRESENT: General Manager Lewinger Operations Dept. Head Przybylski Finance Dept. Head Chambers Attorney Harron District Secretary Bartlett-May Others as per attached list 13 14 CHULA VISTA CITY COUNCIL MEMBERS PRESENT: IS 16 17 18 Moore, Malcolm, Rindone, Horton and Mayor Nader CHULA VISTA STAFF MEMBERS PRESENT: 19 20 Assistant city Manager Morris Director of Public Works Lippitt Deputy City Manager Kremple Attorney Boogaard city Clerk Authelet 21 2. President Hilton inquired if anyone in the 22 23 24 audience desired to address the Board on any item not on the agenda. No one wished to be heard. 3. President Hilton welcomed the members of the 2S Chula vista City Council and Staff. 26 27 28 4. General Manager Lewinger stated discussions have b~en held between the City and Otay since December, 1991 regarding facilities that the District has planned 1 CALL TO ORDER ROLL C}l'.LL AVDIENCE PARTICIPJI- TION WELCOHING RE~mRKS GENERAL ~'ANAGER . S PRFSENTJI.- TTON 22 23 ~ 25 26 27 28 1 in its draft master plan to provide service to the exist- ing and future citizens of Chula Vista. He stated some 2 3 of the concerns expressed by City staff revolve around 4 storage facilities and the cost of facilities. The Dis- trict's planning goals are to develop a master plan that includes a long-range picture for 20 to 50 years and will integrate what used to be three separate areas of the District. These were the North, Central and South areas. The master plan has shown that over time as development occurs, the North will be tied to the Central Area by a pipeline in Proctor Valley Road and the South will be tied to the Central Area by a pipeline on the west side of Brown Field as well as a pipeline from the Olympic 5 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 Training Center area to the Donovan prison area. He stated this will integrate all the systems and should eliminate the perception of piecemeal planning. The master plan will also maintain flexibility to provide for reaction to changes in conditions which may affect the size of ultimate facilities, such as peaking factors, ef- fects of water conservation, and the impact of using more reclaimed water. He stated by building facilities as they are needed based on the conditions in place at that time, the District would not be building too much facility for what might change in the future. One type of storage facility the District builds are the smaller tanks within service zones to meet operational demand. The demand in a neighborhood such as EastLake varies over the day with peak demands typically in the morning and evening. The supply of water from the County Water 2 21 1 2 3 Authority (CWA), however, must be taken at a constant rate. The District must make up the difference between the rate water is taken from CWA and the District's 4 demand through storage. When the demand drops below the rate water is taken from CWA, the tanks are filled. The difference in these numbers represents the volume of storage necessary to equalize the demand in a zone. Mr. Lewinger displayed a schematic of a sample tank including operational storage which typically amounts to about one- third of a maximum day plus fire storage capacity, and emergency capacity for emergencies such as pipeline breaks. A peak day's worth of storage is maintained in the operational reservoirs in case of main breaks where a zone would have to be served without service from the CWA. The District is trying to develop facilities to meet the CWA policy for larger emergencies such as aqueduct breaks or earthquakes. The Metropolitan Water District is trying to develop a reservoir near Hemet so that they will have six months of water storage below San Bernardino and the County Water Authority wants two months of storage below San Luis Rey. Otay has been told by the County Water Authority to be prepared to sustain deliveries to its customers for ten days without service from CWA. This is where the District's criteria for ten days of emergency storage is derived. The Board's policy 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 as recommended by staff is to have five days of this 27 storage in treated water reservoirs owned by the District 28 and another five days in the least costly alternative which is considered to be leasing capacity in the Lower 3 1 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S 26 27 28 otay Reservoir. The first five days already includes the 2.3 days in the emergency storage in the operational tanks. The 2.3 days is used as the peaking factor in Chula Vista to determine how much water is used on a peak day versus an average day and is based on actual experience. He stated in other areas of the District the factor is closer to 3 or 4 while the city of San Diego's actual peaking factor for their system is 1.7. He stated this factor is very dependent on weather. Mr. Lewinger then explained why the District chose five days of covered storage and five days of another type of storage. He stated the District looked at the type of emergency it wanted to be prepared for and con- cluded that it should be prepared for an earthquake. He stated the District felt it was important to be able to provide the customers with drinking water and sufficient water to fight fires after an earthquake. He stated af- ter a severe earthquake there would be multiple pipeline breaks among the water agencies and stated that after the Sylmar quake in 1971, the City of Los Angeles experienced more than 150 pipeline breaks in that area. He stated none of the water agencies keep enough material on hand to repair that many breaks. He stated the District uses a nationwide criteria which is also followed by Chula Vista's fire department which will supply water to fight a fire for five hours. He stated the sum total of the fire storage in the five service zones in Chula Vista is 7.5 million gallons for five hours. There will very possibly be more than five or ten hours of fire fighting 4 1 2 3 after an earthquake and between the fire fighting and the leaks in the pipelines, almost all of the 2.3 days of emergency storage will be used on the first day after the 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S 26 27 28 earthquake. The 2.7 days of emergency storage facilities will be all that will be remaining and it is reasonable to expect that help from the City of San Diego will not be immediately available as they will be having pipeline and treatment plant breaks and power shortages to cope with before they could provide water to the District. The total of the 2.3 days of emergency storage in the operational tanks and the 2.7 days in the emergency storage facilities is the five days the District uses in its criteria. This is a reasonable number based on the District Staff's experience in the water business and weighed against the cost of building the facilities. Mr. Lewinger stated there are several different ways of supplying the second five days of emergency storage and the District is not set on anyone way except that it should be the least costly alternative. He stated Staff considers the least expensive to be an arrangement with the City of San Diego and that Staff is currently negotiating with the city. He stated Staff will also consider outright purchase or building new capacity at Lower otay and leasing or purchasing capacity in the lake, building a District-owned treatment plant to either treat water directly out of the CWA aqueduct or in conjunction with a new open reservoir, developing groundwater and desalination. He stated if all of these alternatives fail, the District could build storage tanks 5 1 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 ~ 21 22 23 ~ 2S 26 27 28 to store treated water but the District wants to do whatever is least costly for the residents of Chula Vista and the District's ratepayers. He stated if none of the other alternatives work and building storage tanks was the District's available source of emergency storage, 100 acres more than the District currently owns would be necessary. He stated the 50 acres purchased from Baldwin along with the property on Eastlake Parkway and the small operational tanks, are enough for five days of storage but to protect the District, it is felt that it would be prudent to work with city staff to identify sites for days 6 through 10 so they do not get developed before a decision is made. If the District is able to develop a less costly alternative for days 6 through 10, the sites could be released. Councilmember Malcolm inquired if there was a reason the sites should all be in Chula vista. General Manager Lewinger stated they do not have to be in Chula Vista and the master plan identifies sites in otay Mesa, the Baldwin property, and in Proctor Valley. Attorney Harron pointed out that the closer to the area of need, the more reliable the service and the Dis- trict is limited by elevations to provide for gravity flow. General Manager Lewinger stated the District's mas- ter plan needs to be re-evaluated as the city re-evalu- ates its general plan. Mr. Lewinger then discussed how the District intends to finance these facilities. He stated the Chula Vista 6 I 2 3 4 .5 6 7 8 9 10 11 12 13 14 1.5 16 17 18 19 20 21 22 23 24 2.5 26 27 28 Staff was concerned that the price tag for all the facil- ities in the master plan is hundreds of millions of dol- lars. He stated this is true, but new development will have to pay its own way and existing customers should pay for replacement or betterment facilities. He stated the District does not want to place the burden on existing residents to build facilities to serve future customers. The District's improvement district in this area has bonding authority but the District's Board has a self-im- posed limit of $0.10 per $100 assessed valuation. He stated developers have informed Staff that a 2% tax rate is the limit for new housing and with 1% of that being the general property tax, that leaves 1% for financing of remaining services. He stated of that 1%, the District would take a maximum of $200 per year on a $200,000 home leaving the City and other services with $1800. Attorney Harron stated the District gets as much bonding authority as possible but its not just to build the original facilities to serve the development but for future improvements also. General Manager Lewinger stated the funds needed for capital facilities are funded through two sources of rev- enue; bond debt repaid through taxes and connection fees, and developer funded. councilmember Malcolm inquired how the District would fund facilities in an area that is built out. General Manager Lewinger stated if an area is built out, the District should not need new facilities. 7 1 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 W 21 22 23 ~ 2S 26 27 28 Councilmember Malcolm stated there are a lot of built out areas that do not have five days. General Manager Lewinger stated in built out areas without five days, the District would consider the facil- ity a betterment project and would fund it through standby charges and availability charges. Existing cus- tomers would pay for the portion of the five days emer- gency storage benefitting them and new development would pay for their share. If the $0.10 tax rate will not pay for the new development's share of the facility, the de- velopers must come up with cash to build the facility. He stated the 30 mg reservoir to be built on Eastlake Parkway will cost between $14 and $17 million dollars but the District will not sell bonds for that amount and so the developers have an agreement with the District whereby their cash participation is $14 million. He stated to cover the design and the construction management for this reservoir, the District may have to sell $5 million dollars worth of bonds which should result in a tax rate of $0.05 or $0.06. He stated any development not participating would have to pay $1,800 per home as their share of the reservoir costs. General Manager Lewinger stated as far as water rates, the District's rates for 95% of its customers are lower than Helix and Sweetwater Authority. He stated the District's monthly service charge is comparable to both agencies also. Councilmember Malcolm stated the city's Staff is saying differently. 8 1 2 3 Chula vista's Director of Public Works Lippitt stated the cost of water service in otay is higher when all the other charges such as the capital facilities costs are added. General Manager Lewinger stated that would not be comparing apples to apples because the older home in Chula vista at some time in the past would have paid for their capital facilities. He stated the new home should pay its fair share of the facilities necessary to provide service. He stated those costs cannot be charged to the existing customers in Chula Vista. Mayor Nader inquired of his Staff how the water cost to an older home in Chula vista would compare between Sweetwater Authority and otay. Mr. Lippitt stated that the homes in otay are in im- provement districts and haven't used assessment district financing and most of the prices in the older homes, if there are any costs, obviously the pipes in front of the house are always paid by the developer and included in the price of the house. He stated he was talking more about the backbone facilities that the original develop- ers and the District paid for. He stated EastLake and some of the new developers have put facilities in, and in fact, the City built a tank through a street assessment district. Director Watton stated out of fairness to Helix and 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 25 26 27 28 Sweetwater, their rates are higher because they have older systems and they are funding a lot of their re- placement out of their annual budget. He stated a few 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 years ago San Miguel Partners compared developing their project in Sweetwater Authority versus otay and found the costs to be almost the same. Mayor Nader stated he still had not heard an answer to his question. He stated he thought the Council had been told that when a number of fees, taxes, etc. were added on top of the basic water rate, otay was a great deal more than Sweetwater and he inquired of his Staff if the cost to the new homes is put aside, .is that true. Mr. Lippitt stated if the tax amount is not in- cluded, theOtay bill would be a lot less. Mayor Nader inquired what taxes an older home would pay. Mr. Lippitt stated that was not known. General Manager Lewinger stated, for example, Im- provement District 22 where Councilmember Malcolm re- sides, the tax rate for a $200,000 home would amount to about $80 a year and will be 0 in five years. Mayor Nader inquired if the tax is the only other charge besides the basic monthly charge that his Staff included in their figures. Mr. Lippitt said that was the only other charge. Director Watton stated the tax is not a monthly fee and City Staff should be looking at the monthly cost to the homeowner. Councilmember Malcolm stated their Staff had indi- cated that Otay's water rate is cheaper but there are a lot of hidden charges when in fact Otay is saying if a 10 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 2 3 home is older there are no other charges, just the cost to the new homes for the necessary facilities. General Manager Lewinger stated there were some goals he hoped to accomplish at today's meeting. He stated the most important one was for the two agencies to reach a consensus that his description of the District's policies and goals regarding providing storage for an emergency is reasonable and that five days is not an overly conservative amount and that days 6 through 10 should be provided by whatever is the least costly alternative. He stated the second goal is to provide for coordinated planning between the two agencies, especially regarding the potential siting of reservoirs for days 6 through 10. He proposed that if this can be done, that before any construction is done on the Baldwin site, the District would do an EIR. He stated an EIR would also be done before the District formally adopts its master plan. He stated he hoped that Chula vista could include the reservoir sites for days 6 through 10 in its general plan and create a "holding" zone for those sites until the District determines what the least cost alternative actually is and if it isn't tanks, those sites can be released. He suggested the best way to accomplish all of this if a consensus is reached is to use the Interagency Task Force who could oversee the implementation of these goals. Councilmember Malcolm stated if he understood so far, the District would agree that prior to construction of the site purchased from Baldwin, an EIR would be done 11 I 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 ~ 2S 26 27 28 and that prior to adoption of a master plan, an EIR would be completed. General Manager Lewinger stated the District has agreed to do this. Councilmember Malcolm asked, if the attorneys can put an agreement together, would there be a problem? Assistant City Manager Morris stated City staff would like to make a presentation. He stated Staff agrees that discussion has been going on since December and part of the process has been to get the issues on the table. He stated both agencies have been going through a protracted process of doing that with an exchange of let- ters raising, responding and identifying new issues and the majority of issues have probably been identified that are of a concern to the city. He stated the City saw movement on otay's part in terms of its initial proposal versus what it has now, regarding the move down to five days covered storage versus the original position. He stated city Staff still has concerns and he is not cer- tain that the city is ready to reach consensus that five days is appropriate and Staff's position might be that maybe this meeting would be the impetus for future meet- ings between Staff on these issues. Councilmember Malcolm inquired if it was possible for the City to deal with the issue of the lawsuit before getting into whether five days is appropriate or not. He inquired what else City staff would want otay to agree to. 12 1 2 3 4 S 6 7 .8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Assistant city Manager Morris stated he heard Mr. Lewinger indicate otay still needs the five days and City staff still has questions on that. Mr. Lippitt inquired what the city's position would be as far as moving on if the City is satisfied with otay's agreement to perform the environmental work on the master plan and the site. City Attorney Boogaard explained that the lawsuit is based on two premises: that the District should have done environmental review before purchasing the land and otay should submit their public works projects to the City for review by the City's Planning Department to determine consistency with the city's general plan. He stated the fundamental premise that has brought about these discus- sions is that the City Public Works Department is not convinced that a proper planning approach has been uti- lized in determining the five-five split for storage. He stated he was advised by that Department that there should be some risk assessment to determine what the split should be between covered versus open storage be- fore entering into a decision to buy land. He stated that risk assessment should contribute to a master water plan and after the draft master water plan is prepared an environmental impact report should be engaged in and then the purchase of land necessary to meet the original risk assessment. He said this process has been reversed in this case and the land has been purchased first before any risk assessment or final master plan or environmental impact report has been done. 13 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 2-4 25 26 27 28 1 2 3 Councilmember Moore stated now that they understand otay's side he would like otay to understand the city's side. He stated the City as a multi-purpose agency al- ways expects a draft master plan and a draft ErR. The CEQA rule says "thou shall" and he personally waits for that so that the City can review the documents and return it with their concerns. He stated if they do not receive these documents or the District disagrees with the con- cerns, then a lawsuit is formed for the purpose of forc- ing people to review the concerns of the other parties. His concern is that he has not had an opportunity to re- view a draft master plan or draft EIR. He stated he has seen a master plan but it did not say draft and it did not have a date. 4 Attorney Harron stated that a draft master plan was sent to the City in November of last year and city Staff has commented and as a result of the comments, some changes were made by the District. He stated the most important change was in the underground storage for days 6 through 10 which now provides that the District will look for the least expensive alternative. He stated Councilmember Moore is correct regarding the ErR on the master plan. He stated the District has been trying to decide what the project is before an EIR is commenced. He stated the project now will include some of the changes recommended by city staff that otay has agreed to and that is why there is no EIR today. Councilmember Moore stated that was his primary con- cern but his second concern is what happens to the prop- 14 19 20 21 22 23 ~ 2~ 26 27 28 1 erty owners in Chula Vista if the cost of all the utili- ties and services exceeds the 2% tax limit. 2 3 Attorney Harron stated the developers have informed 4 the District that they cannot market homes with more than the 2%. S 6 7 8 9 Councilmember Moore inquired if any other agency could assess the property owner in this manner. Attorney Harron stated that could not be done unless the developer or their successors supported the assess- 10 ment. 11 General Manager Lewinger stated a developer would 12 not support an assessment district if it increased the 13 14 tax bill beyond the 2% because the developer would not be able to sell the homes. IS 16 17 18 Councilmember Moore stated these things should have been worked out by the two Staffs and brought forward to the two policy groups but these are his two concerns. Mayor Nader inquired if Mr. Lippitt could make a presentation that would be keyed specifically to whatever issues might be outstanding regarding the lawsuit. Mr. Lippitt stated he had a presentation that would speak to some of the City Staff's concerns also. He stated Otay has been giving the city extensions on the time limit for filing the lawsuit but he understood that Otay had decided not to grant any further extensions af- ter September and so this meeting was called. He stated he felt there had been progress made between the two Staffs but there is still a need for further discussion of some of the issues. He stated City Staff members are 15 10 II 12 13 14 IS 16 17 18 19 20 21 22 23 ~ 2S 26 27 1 2 3 not experts in the water field so they hired a consultant to help them and they also looked at other agencies' policies. He stated this was not done necessarily to just critique otay's planning but because the city has their concerns with multi-millions of dollars of improve- ments but they have to build in order to serve their area. He stated in that there is $226,000,000 that otay is proposing to build District-wide before the year 2000. He stated that all of these facilities must be financed 4 S 6 7 8 9 out of the tax rate or the price of the home. He stated when the District purchased the 57 acres, the whole thing became urgent and that was when the lawsuit was dis- cussed. When City staff reviewed the master plan, they saw that $118,000,000 was estimated for terminal storage and $50,000,000 for operation storage. He stated the 57 acre parcel purchased from Baldwin is for approximately 90 million gallons with 30 million gallons being built . for EastLake. He stated every day of storage in concrete reservoirs costs approximately $30,000,000 when built out. He stated that relates in the master plan to an av- erage day use of about 76 million gallons and even though the two Staffs are down to two or three days still under discussion, that is still $80 to $90 million dollars and that amount is still worth talking about. He stated one other area that Staff had concerns with is the peak fac- tor which is 1.4 in Sweetwater Authority and otay's mas- ter plan table 4-2 indicates otay's Central Area maximum 28 day to the average annual day ratio is 1.7 or 1.6. He stated he understands it is hotter in otay's area but he 16 4 5 6 7 8 9 10 II 12 J3 14 15 16 17 18 19 20 21 22 23 2.4 25 26 27 28 1 2 3 is wondering if otay's factor of 2.2 is a little high and maybe a lot of facilities could be reduced in cost if that factor was more realistic based on the trends. He stated table 4-1 indicates the trend is tending to go down especially when water reclamation and other things impact the peaking factor. He stated city staff believes otay should adopt a policy on storage, finalize the mas- ter plan, determine locations and perform the environmen- tal study and then purchase the land. He stated that is not the way the process has occurred but maybe there is a way through agreements that the City can be satisfied legally. He stated the City does not know if the five days is the correct number of days for covered storage and is concerned that the rest of the five days is cen- trally located around the aqueduct near EastLake High School and is not spread out enough. He stated an engi- neering firm could probably look at the risk analysis and look at the standards throughout the area and come up with a number. He stated the City feels based on an ex- penditure of $80 million dollars, it would be worth spending $40,000 or $50,000 to perform a study like this. He stated the city is also concerned with the cost to the homeowners for the different alternatives and he under- stands otay has looked at this but only from the taxes standpoint, not the total cost including the cost of the home and other assessment districts and improvement dis- tricts. He stated the City also feels otay should com- plete its negotiations with San Diego and/or Sweetwater Authority and find out what those costs would be and then 17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 ~ 25 26 27 28 finalize the master plan with a financial plan to tie in the entire burden including the City's needs. He stated the City understands that otay must meet certain safety standards and other requirements and policies. He does not think the two Staffs are far apart on agreement but are only arguing about a few days. General Manager Lewinger stated he and his Staff are professionals in the water business with 20 to 30 years experience and the City has prOfessionals advising on health and safety issues such as fire service. He stated the City has certain criteria on response time for fire service as well as police service. He stated just as it is very difficult for the City to determine the value of providing a five minute response time in lieu of a six minute response time, a study is not done, the City looks to its professionals to determine what is acceptable from a risk standpoint. Assistant City Manager Morris stated before that ex- ample is used he would like to point out that a study was done in a fire station master plan siting using consul- tants and Staff to analyze that entire issue. Councilmember Malcolm stated it was not a good exam- ple but it was understood where Mr. Lewinger was heading. General Manager Lewinger stated he tried to layout a reasonable scenario that the District is trying to pro- tect against which is similar to insurance where some people live on the edge and don't carry a lot of insur- ance and some want to be safe and pay the extra cost. 18 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S 26 27 28 Councilmember Malcolm stated he agreed but he had no 1 2 idea what the assessment would be for four days versus five days and he stated he would like to be educated on this. 3 4 General Manager Lewinger stated the District has not done a risk analysis as requested by the City staff but the District's goal is to not run out of water under a plausible set of circumstances. He stated Mr. Lippitt is correct that the master plan indicates a huge amount of money for storage. However, under the revised guidelines once the 30 million gallon EastLake Reservoir is constructed, if development continues at the current pace, additional storage would not be necessary until after the year 2000. He stated the majority of that money was to build the second five days of tanks which will not be built if a cheaper alternative is available. He stated regarding the issue of the peaking factor and Mr. Lippitt's comment that if a lower peaking factor was used, smaller facilities could be built, the District cannot pick a peaking factor, it must use the factor that exists which is 2.3 in Chula Vista. He stated the figures in table 4-1 are monthly peaking to average ratios which are much lower than maximum day. He stated there is a trend to peaking factors getting lower but the District is looking at a fifty year planning horizon. He stated the other thing to remember is assuming five days of emergency storage, if the 2.3 peaking factor becomes 1.', the District still needs five days and whatever is taken out of operational tanks must be put in the 19 I 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 ~ 2S 26 27 28 terminal storage tanks to achieve the five days. He stated tanks have to be sized for each zone and there are five zones in Chula vista. He stated the smaller the zone, the larger the peaking factor because the larger the population, the smoother the curve. The operational tanks in each zone are sized using the peaking factor and whatever portion of the five day emergency storage is not in the operational reservoir needs to be in the emergency reservoir. He stated the emergency storage in the operational tanks is counted toward the needed area-wide emergency storage. Director Watton stated the District's preference is to have the emergency storage located in the operational tanks to improve response time. Councilmember Malcolm inquired what peaking factors have to do with the emergency storage. General Manager Lewinger stated peaking factors have nothing to do with the emergency storage but are used to design the other facilities such as pipeline and pump stations. He stated the point is that the peaking factor is what it is and is not a made up number. Mr. Lippitt stated he would think the District would want all of its storage in the operational tanks spread around the District. Director Watton stated that would be even more ex- pensive. Assistant city Manager Morris stated it is apparent from this discussion that there are still a lot of issues to discuss and the City staff is not prepared to recom- 20 4 S 6 7 8 9 10 II 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S 26 27 28 I 2 3 mend to the Council that five days is appropriate and they have concerns about turning this over to the Intera- gency Task Force. He stated a better scenario might be to have the two staffs meet to discuss the issues further and bring a final report back to the respective Boards. Councilmember Moore stated it seems to him that our combined goals are to pursue the open and closed storage days of five/five with a goal to reduce closed storage. If closed storage is reduced the next area is to combine the above costs to the combined constituents with both agencies trying for a lower minimal cost. If a minimal cost is achieved more money is released for infrastruc- ture or the cost to the constituency is lowered. Another goal is to pursue sites for closed storage and pursue an EIR to fruition. If the agencies could come an agreement on this type of verbiage the two Staffs could work to- gether and keep the policy makers advised. Mayor Nader inquired if there was any inconsistency between Mr. Lewinger's presentation and Councilmember Moore's statement and did otay leave anything that were still concerns of city Staff regarding the lawsuit that still needs to be resolved. Attorney Boogaard stated he would like to advise the Council in Closed session. Mayor Nader stated he heard nothing in the otay pre- sentation that sounded wrong with the exception of the five days of covered storage and he doesn't know that it is wrong but if City staff still has qualms he would like to hear what the attorney has to say in Closed Session 21 1 2 3 4 5 6 7 8 9 10 11 12 \3 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 before making any commitments. He stated one of the con- cerns he has is that the citizens of Chula Vista be effi- ciently served and while he is not an expert in the water field, he does have to listen to any concerns expressed by Staff. He stated he does feel there needs to be more closer coordination of planning between the Staffs. Director Mulcahy stated it is the otay Board's con- cern that there is enough water to serve its con- stituents. Councilmember Moore stated the District does have some flexibility in what it can do with conservation and restrictions. Mayor Nader stated there was no action that could be taken today but there is need for further discussion on the City's part and he would like to bring the meeting to a close. Attorney Harron stated he would like to reach agree- ment to use the Interagency Task Force to provide status reports because one of the reasons the otay Board stopped extending the statute of limitations is that it was felt the city was being unresponsive. Mayor Nader stated he saw no reason not to use the Task Force. Assistant City Manager Morris stated Staff did not disagreed to the Task Force's use for that purpose but they did not want it to be a decision making body. Councilmember Moore stated some type of time line should be used to keep everyone's feet to the fire. 22 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 24 2S 26 27 28 1 Director Watton stated there are really two issues that will not be resolved today but he would like closure on them quickly and that is the lawsuit and the reservoir 2 3 4 site. He stated either this is going to be worked out or the City is going to file the suit. He stated otay does not want a suit to be filed because that doesn't look good for anybody and is kind of stupid when you get to the end of it because its usually realized that it could have been worked out. He stated if agreeing to an EIR process before concrete is poured is a way to do that, fine but we do need to come to terms on that. He stated S 6 7 8 9 the two agencies should continue the planning and better coordination which is a ~ust without compromising the de- livery of services on either side. He stated debate can be held on the size of water facilities or the size of streets but the coordinated planning effort is what is important not arguing over four versus five days. He stated the bottom line for him on the development issue, whether financing is provided through bonding or capacity fees, the District is going to have a certain level of service necessary for health and safety and the City will have certain levels for the services they are concerned with and either the development supports that in the mar- ket place or it doesn't. If it does support it you move forward and if it doesn't then does the agency go back and reduce the level of service until it works? He stated that is where the coordination and the planning comes in and the location of sites and the master plan and general plan is where it gets more mechanical and 23 I 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 2<4 2S 26 27 28 technical. He stated it's important for the Staffs to have a better relationship than in the past and not be- cause it hasn't been available but because it hasn't been needed. Both agencies have been going about their busi- ness but now in the current economic times it has become much more critical. He stated the lawsuit and the EIR issues need to be dealt with immediately and the Staffs should get together and coordinate the other issues on an on-going year after year basis, particularly when otay Ranch begins. Councilmember Moore stated to settle the lawsuit is- sue, shouldn't the party who failed to meet a CEQA item make the first move. Director Hilton inquired if the City performs CEQA on every project or any approval of purchase before it comes before the Council. Councilmember Moore stated if a certain level of construction in an area where there are mutual government entities, certain things must be done. Director Watton stated to answer Mr. Moore's ques- tion, the District has already stated an EIR would be done before the site is developed. Councilmember Moore asked if the District would put that in writing. Director Watton stated the District would. General Manager Lewinger stated that had already been put in writing. Councilmember Malcolm stated the City Council has been given a set of facts that is a little different from 24 1 2 3 4 .5 6 7 8 9 10 11 12 13 14 1.5 16 17 18 19 20 21 22 23 24 2.5 26 27 28 their Staff's presentation and Staff needs to look at the issues again. He stated he thinks every one of the goals outlined by General Manager Lewinger are exactly the same as the City's such as low price, quality service, and enough water for emergencies. He stated he did not want the District to tell the city how to run the police department and he does not want the City to tell otay what is proper for water issues. He stated the City is concerned that proper zoning and proper planning be done in the placement of these facilities and how it affects the city's circulation, housing, and infrastructure. He stated hopefully the agencies can use the Task Force to get reports to both agencies. Director Haden stated the District had no intention of trying to bypass CEQA but the property came up and the District needed it. Attorney Harron stated a negative declaration was done at the time. Councilmember Horton asked for a response to the comment that the property came up and the District had to act on it. Attorney Harron stated what happened was that Bald- win was in difficult financial straights and the District had been looking at the property for a long time and were able to get a very good deal. Councilmember Horton stated the District had identi- fied it prior to Baldwin coming to the District and mak- ing the offer. 25 " 1 2 3 4 S 6 7 8 9 10 11 12 13 14 IS 16 17 18 19 20 21 22 23 2-4 2S 26 27 28 Attorney Harron stated that was correct, it was an opportunity the District did not want to miss. He stated he checked to see if there would be opposition to the preparation of a negative declaration, but as he has since learned, Tony Letteri, the person he called was the wrong person to talk to and the District found out at the last second that the city was very much opposed to the negative declaration instead of an EIR but at that point the District was in a time bind. He stated part of the EIR will be an alternatives analysis and if something else makes more sense and is more feasible then that would become the project. President Hilton inquired if there were any other comments. There were none and he thanked everyone for attending the meeting. 5. with no further business to come before the ADJOlJRNl-'..EK Board the meeting was adjourned at 5:01 p.m. 4Jlrk: ~ President ATTEST: 26