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HomeMy WebLinkAboutAgenda Statement 1988/10/25 Item 15 COUNCIL AGENDA STATEMENT . ITEM TITLE: I tern 15 Meeting Date 10/25/88 Resol uti on/3 toZ 3 Appropri ati ng addi ti onal funds to reimburse Otay Water District for costs associated with water facilities for EastLake Asses:;~ District 85-2 Director of Public Work~ 1~ City Manager( (4/5ths Vote: Yes~No_ SUBMITTED BY: REVIEWED BY: BACKGROUND: On December 17, 1985, the City Council approved an agreement between the Ci ty and Otay Water District for installation, conveyance, maintenance and operation of water facilities within EastLake Assessment District No. 85-2. The water facil ities were constructed by pub1 ic works contracts under the procedures of the "Municipal Improvement Act of 1913." Construction of the water facilities were financed through the sale of "1915 Act" bonds. The agreement stipulated that upon completion of the installation of the .facilities, Otay Water District will own, operate and maintain said mprovement facilities. The agreement further stipulated that: 1. All the improvements shall be installed and completed in accordance with plans and specifications approved by Otay Water District. 2. Otay Water District shall be authorized to inspect all work and to reject any work or improvement that does not meet requirements of the plans and specifi cati ons. 3. Otay Water District shall be reimbursed for all costs incurred for inspecting, rejecting or accepting the said improvements. 4. City shall assure that all contracts awarded shall provide for warranties or guarantees whi ch shall protect Otay Water Di stri ct for any defects discovered within a period of one year following final acceptance of the work by Otay Water District. The City awarded four separate contracts for water facilities within EastLake Assessment District 85-2 as follows: 1. EastLake Business Center 2. 20-inch offsite water main 3. 5 million gallon steel reservoir 4. 980 zone pump station . b the City C>xJnsil of Chula Vi:;tJ, C~,:ifornia Dated ./ Page 2, Item 15 Meeting Date 10/25/88 1 through 3 on August 25, 1987, Water District has not accepted is operational and is being ~he City accepted the contract work for items and item 4 on October 13, 1987. To date Otay the water facilities although the system maintained by Otay Water District. There are a number of deficiencies that still need to be corrected before Otay Water Di stri ct wi 11 accept the system. The defi ci enci es are items that were not included in the original plans but are necessary to bring the system to their standards. These items should have been on the original plans and are a 1 egi timate cost of the assessment di stri ct. In the process of Otay Water District correcting the deficiencies and operating and maintaining the system, the cost of doi ng so has exceeded funds appropri ated in EastLake Assessment District 85-2 for this purpose. As of September 15, 1988, Otay Water District has incurred a deficit which needs to be reimbursed by the Assessment District. Otay Water District has estimated it will cost $15,000 to complete the work required to bring the system up to their standards. They have agreed to accept $15,000 for thi s work and to accept the system for full operati ons and responsibility. RECOMMENDATION: Ci ty Counci 1 appropri ate funds from the EastLake Assessment Di stri ct 85-2 Improvement fund in the amount of $111 ,000 to reimburse Otay Water District. ~ISCUSSION: ~n accordance with the agreement entered into between the City and Otay Water Di stri ct for water faci 1 iti es withi n EastLake Assessment Di stri ct 85-2, Otay Water District is entitled to reimbursement for the following items of work: 1. Cost of provi di ng the automati c control panel for the 980 zone pump station. This item was purposely deleted from the original plans and specifications because it was the only way to acquire the equipment required by the Water District. The automatic controls cost the District $25,872. 2. Cost of correcting 5 punch list items which were not included in the original plans and specifications. These deficiencies had to be corrected for operation safety and security of the pump station. These items are estimated to cost $15,000 and are as follows: a. b. c. d. . e. Access guard on the exterior wall of the pump station. Access into the radiator shroud for cleaning. Installation of diffusers on air release and vacuum values of pump barrels. Extension of oil tank drain piping. Installation of a 6-inch pressure relief valve on the suction header. -' ~. e. . Page 3, Item 15 Meeting Date 10/25/88 Cost overruns on six Otay Water District work orders (1473, 1485, 1653, 1701, 1702 and 1703). These cost overruns are due to inspection and staff charges for correcting the various deficiencies so that the system can be accepted by the Water District. Work Orders 1473,1485 and 1701 are chargeable to the 980 zone pump station. Work Orders 1653, 1702 and 1703 are for the EastLake Business Center, 20-inch offsite water main and the 5 mg steel tank reservoir, respectively. Work Order 1687 shown in the District's summary is not for thi s project. As of September 15, 1988, the charges to these work orders are as foll ows: Work Otay Water Deposits Current Order District Charges Received Deficit 1473 $ 16,638 -0- ($16,638) 1485 $ 2,119 -0- ($ 2,119) 1653 $ 26,087 $ 15,637 ($10,450) 1701 $103,239 $ 76,000 ($27,239) 1702 $ 26,974 $ 22,465 ($ 4,509) 1703 $ 70,621 $ 58,547 ($12,074) Totals $242,678 $) 72 ,649 ($70,029) EastLake Development Company is also responsible for charges reimbursable to Otay Water District. This includes charges accrued to work order 1653 after the date of acceptance of the work by the City Council on August 25, 1987. EastLake must also pay for the installation of a second surge tank at the zone 980 pump station. These costs are separate from and in addi ti on to costs to be reimbursed by AD 85-2. The estimate of these charges are: Work Order 1653 Second Surge Tank Tota 1 $ 110 $60,000 $60 , 11 0 5. There has been an intermittent problem with the buried telemetry cable between the pump station and steel tank reservoir. The cost of correcting this deficiency is the responsibility of the contractor. At this date, the cost cannot be determined. The Assessment District's financial responsibility for the cost overruns are as follows: Automatic Control Panel Five Punch List Items Work Order Cost Overrun To ta 1 $ 25,872 $ 15,000 $ 70,029 $11 0 ,901 ,_/' Page 4, Item 15 ~ Meeting Date 10/25/88 Funds are avail abl e to reimburse these expenses from the EastLake Assessment District 85-2 Improvement Fund. Payment of these funds will not increase the current assessments being paid by the EastLake property owners. FISCAL IMPACT: The cost of the water facilities are funded from "1915 Act" bonds which were sold to specifically finance this project. The cost of maintaining these facilities will be paid for by Otay Water District once the improvements are accepted into their maintained system. KJG: nr/ WPC 3905E . .