HomeMy WebLinkAbout2022-04-26 - Board of Directors Meeting Agenda PacketYorba Linda
Water District
AGENDA
YORBA LINDA WATER DISTRICT
BOARD OF DIRECTORS SPECIAL MEETING
Tuesday, April 26, 2022, 4:00 PM
1717 E Miraloma Ave, Placentia CA 92870
1. PARTICIPATION INSTRUCTIONS
Due to the continuing state of emergency declared by the California Governor related to preventing the
spread of Coronavirus (COVID-19), and pursuant to California Government Code Section 54953(e), this
meeting will be facilitated in a hybrid format. As such, Directors and members of the public may choose
to participate in person or by video/teleconference. Information for accessing this meeting by telephone
or internet-based service is provided below. For questions regarding participation, please call the Board
Secretary at (714) 701-3020.
Computer/Mobile Device: https://us06web.zoom.us/m/86737627695
Telephone: (669) 900-6833 or (346) 248-7799
Meeting ID: 867 3762 7695
Live -stream: https://www.ylwd.com/youtube
2. CALL TO ORDER
3. PLEDGE OF ALLEGIANCE
4. ROLL CALL
J. Wayne Miller, PhD, President
Brooke Jones, Vice President
Trudi DesRoches, Director
Phil Hawkins, Director
Tom Lindsey, Director
5. PUBLIC COMMENTS
Any individual wishing to address the Board (or Committee) is requested to identify themselves and state
the matter on which they wish to comment. If the matter is on the agenda, the Chair will recognize the
individual for their comment when the item is considered. No action will be taken on matters not listed on
the agenda. Comments are limited to three minutes and must be related to matters of public interest
within the jurisdiction of the Water District. (GC 54954.3)
6. DISCUSSION ITEMS
This portion of the agenda is for matters that cannot reasonably be expected to be concluded by action
of the Board (or Committee) at the meeting, such as technical presentations, drafts of proposed policies,
or similar items for which staff is seeking advice and counsel. Time permitting, it is generally in the
District's interest to discuss these more complex matters at one meeting and consider formal action at
another meeting. This portion of the agenda may also include items for information only.
6.1. Summary of Draft Budget for Fiscal Year 2022-23, Updated Variable Expenses,
Supplies and Services, and Salaries and Related Expenses
7. ACTION CALENDAR (BEGINNING AT 6:00 PM)
This portion of the agenda is for items where staff presentations and Board (or Committee) discussions
Page 1 of 82
are needed prior to formal action.
7.1. Due Process Hearing Regarding Award of Construction Contract for the Hidden
Hills Booster Pump Station Improvements Project
Recommendation: Based on staff's bid review and reference check, and after
the Board considers the attached written documents (Exhibits 1 and 2) and
hears oral testimony from Project bidder, MMC, Inc., staff recommends that the
Board determine MMC, Inc. is not a responsible bidder; so, it would not be in the
District's best interests to award the Project contract to low bidder, MMC, Inc.
Instead, it is in the District's best interest to award the contract to second low
bidder, Pacific Hydrotech Corp., as discussed in Item No. 7.2 of this agenda.
7.2. Award of Construction Contract for the Hidden Hills Booster Pump Station
Improvements Project.
Recommendation: Pending the results of the due process hearing in Item No.
7.1 of this Board meeting agenda, staff recommends that the Board of Directors
award the Construction Contract for the Hidden Hills Booster Pump Station
Improvements Project to Pacific Hydrotech Corporation for $2,443,9 10. 00, Job
Nos. J-2020-20 and J-2018-27.
7.3. Fourth Amendment to the Water and Sewer Facilities Agreement Between the
Yorba Linda Water District and North County, BRS, LLC (now Lennar Homes of
California LLC) for the Cielo Vista Development Project
Recommendation: That the Board of Directors approve the Fourth Amendment
to the Cielo Vista Project Water and Sewer Facilities Agreement dated August 1,
2018, conditioned on the Property Owner's signature to the Fourth Amendment
within 30 days of this approval.
8. ADJOURNMENT
8.1. The next regular Board meeting is scheduled Tuesday, May 10, 2022. Closed
Session (if necessary) will begin at 5:30 p.m. and regular business at 6:30 p.m.
Items Distributed to the Board Less Than 72 Hours Prior to the Meeting-
Non-exempt
eetingNon-exempt materials related to open session agenda items that are distributed to a majority of the Board of
Directors (or Committee Members) less than seventy-two (72) hours prior to the meeting will be available for
public inspection in the lobby of the District's Administrative building located at 1717 E Miraloma Ave, Placentia
CA 92870 during regular business hours. When practical, these materials will also be posted on the District's
website at https://ylwd.com/. (GC 54957.5)
Accommodations for the Disabled
Requests for disability -related modifications or accommodations, including auxiliary aids or services, required for
participation in the above posted meeting should be directed to the Board Secretary at (714) 701-3020 at least 24
hours in advance. (GC 54954.2(a))
Page 2 of 82
ITEM NO. 6.1.
Yorba Linda
Water District
/_[r]=1►1I7_\V=1161AI
MEETING DATE: April 26, 2022
TO: Board of Directors
FROM: Doug Davert, Interim General Manager
STAFF CONTACTS: Delia Lugo, Finance Manager
Paige Appel, Budget Analyst
SUBJECT: Summary of Draft Budget for Fiscal Year 2022-23, Updated
Variable Expenses, Supplies and Services, and Salaries and
Related Expenses
Staff will provide the attached presentation during the meeting.
ATTACHMENTS:
1. Presentation
2. Revised Presentation
Page 3 of 82
Yorba Linda
Water District
Page 4 of 82
Overview
• Supplies & Services
• Salaries & Related Expenses
• Non -Operating Expenses
• Debt Service
• Revised Budget
• Summary of FY2022-23 Budget
• Summary of Rates& Other Considerations
• Revised CIP
4/26/2022 Page 5 of 82
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Page 6 of 82
Supplies & Services Analysis
2,000,000
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
� 2021 Actuals
� 2022 Projections
0 2023 Budget
--W-2021 Rate Study
Historic Trends - Supplies & Services
FY21, FY22 Projections, FY23 Budget
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252,843
W555,422
340,893
529,772
i3a,�oa i
351,708
� �
48,973
104,815
�
_
Communicati
Contractual
Data
District
Dues &
Fees &
ons
Services
Processing
Meetings &
Memberships
Permits
Insurance
Maintenance
Materials
Events
164,667
715,712
311,867
24,031
87,809
362,050
274,975
800,876
719,502
140,985
551,996
322,529
34,995
103,366
441,182
284,869
1,576,275
714,317
193,000
614,039
421,614
45,500
97,522
467,990
434,590
1,911,900
1,001,300
252,843
555,422
340,893
48,973
104,815
529,772
351,708
738,268
725,679
Variances Explanations for Impactful Expenses - 2023 Budget to 2022 Projections
Contractual Services -The increase of 11%from FY22 Projections is due to new contracts for janitorial and landscaping services that will beat a higher
cost than the current contracts. These expenses were originally budgeted for FY22 but are now being moved to FY23 Budget. The increase is also due to
mailing and printing of backflow inserts to customers.
Data Processing -The increase of 31% from FY22 Projections is due to additional software licenses from Microsoft and to purchase additional Dell
support.
Insurance - The increase of 53% from FY22 Projections is due to increase in premium rates, ACWA-JPIA Property insurance coverage for the PFAS
Treatment Plant and Cybersecurity Insurance.
Maintenance - The increase of 21% from FY22 Projections is due to pavement program costs inherited from City of Yorba Linda and Placentia,
maintenance of root control, building 4 lobby door replacement, chlorine building roof repair, concrete work at Lakeview Reservoir and SCADA AGB
Earthquake Testing.
Materials - The increase of 40% from FY22 Projections is due to the completion of capitalized grant project and will resume regular maintenance
schedule and increase cost of meter replacements. The increase is also due to replacing 5 methane sensors at various sites.
4/26/2022 Page 7 of 82
4
Supplies & Services Analysis Cont.
1,800,000
Professional
Developmen
1,600,000
Board
Services
1,400,000
e Accounts
35,857
1,200,000
45,362
1,385,819
1,000,000
1,713,760
65,738
800,000
600,000
11,338
171,510
400,000
194,213
61,500
200,000
10,000
39,093
0
137,000
1,422,000
50,147
Non Capital
Office
394,728
Equipment
Expense
� 2021 Actuals
197,846
39,759
� 2022 Projections
167,579
41,817
1 2023 Budget
204,300
42,300
- 2021 Rate Study
194,213
39,093
Historic Trends - Supplies & Services
FY21, FY22 Projections, FY23 Budget
Professional
Professional
Developmen
Vehicle
Board
Services
t
e Accounts
35,857
1,025,746
45,362
1,385,819
85,550
1,713,760
65,738
1,007,226
Travel &
Uncollectibl
Utilities
Vehicle
Board
PFAS
Conferences
e Accounts
Expenses
Election
10,248
15,907
202,964
469,612
43,529
11,338
171,510
408,341
61,500
119,330
10,000
224,000
538,550
137,000
1,422,000
50,147
10,196
212,508
394,728
94,156
819,467
Variances Explanations for Impactful Expenses - 2023 Budget to 2022 Projections
Professional Services - The increase of 24% from FY22 Projections is due to the Water Master Plan and Hydraulic Modeling, Cyber Security Analysis
and Compensation Study.
Travel & Conferences - The increase of 174% from FY22 Projections is due to less COVID restrictions for conferences and events.
Vehicle Expenses -The increase of 32% from FY22 Projections is due to gas and diesel prices increasing.
4/26/2022
Page 8 of 82
5
Supplies & Services - Rate Study
Comparison
202iRate Study Assumptions
FY2020-21
FY2021-22
FY2022-23
Supplies & Services - Water $ 4,651,466
$ 4,959,410
$ 5,533,227
FY23
Budget Supplies & Services
Supplies & Services - Sewer 1,323,233
982,065
1,002,617
$12,000,000
$6,535,844
$ 5,974,699
$ 5,941,475
$ 6,535,844
$10,000,000
$8,000,000
$5,974,699 $5,941,475
$6,000,000
Historic & Future
$4,000,000
Prior Year
Projected
Budget
$2,000,000
'
FY2020-21
FYE2021-22
FY2022-23
423
Supplies & Services - Water $ 4,465,134 $ 5,486,003 $ 8,376,801 Prior Year Projected Budget
FY2020-21 FYE2021-22 FY2022-23
Supplies & Services - Sewer 994,289 1,021,305 1,307,444
Supplies & Services - Water � Supplies & Services - Sewer
$ 5,459,423 $ 6,507,308 $ 9,684,245
f 2021 Rate Study Assumptions
Variance from Assumptions
Rate Study Variance $ $
Variance
(515,276) $ 565,833 $ 3,148,401
-9% 10% 48%
4/26/2022 Page 9 of 82 6
Supplies & Services — Off Trend Expenses
Description: Off trend expenses are expenses that have not been consistent annual operating expenditures.
This is to help compare supplies and services of the District from year to year.
Off Trend Expenses
Description
Board Election
Additional Cost - City of Yorba Linda & Placentia Pavement Program
Water Master Plan & Hydraulic Modeling
Compensation Study
Total
Supplies & Services without Off Trend Expenses
Supplies & Services — Total Expenses
Off Trend Expenses (Minus)
Variance Increase/Decrease Year to Year
Variance $
Variance
Department
Board of Directors
Engineering
Engineering
Human Resources
Amount
$ 137,000
544,000
500,000
60,000
$ 1,241,000
Projections Budget
FYE2021-22 FY2022-23
$ 6,507,311
0
$ 6,507,311
$ 9,684,245
(1,241,000)
$ 8,443,245
FY22 Projections to
FY23 Budget
$ 1,935,934
30%
Variance Explanation
The cost of operating the PFAS treatment plant is projected to be s61,soo for FY22 Projections and
budgeted at $1,422,000 for FY23. This makes up the majority of the increase in the total budget between the
two years.
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7
W
N,'/' Salary Related 1
Expenses IWO.
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Salary Related Expenses - Rate Study
Comparison
202iRate Study Assumptions
FY2020-21
Salary Related - Water $ 10,156,647 $
Salary Related - Sewer 1,738,874
$ 11,895,521 $
FY2021-22 FY2022-23
11,893,405 $ 12,770,939
2,041,083 2,191,322
13,934,488 $ 14,962,261
Variance Explanation
PARS Contributions is included in the Rate Study
amounts $1,o87,325 for FY23 and s1,go6,291 for
FY22.
Historic & Future FY23 Budget Salary Related
Prior Year Projected Budget Expenses
FY2020-21 FYE2021-22 FY2022-23
$20,000,000
Salary Related - Water $ 9,389,188 $ 10,174,107 $ 11,359,392 $13,934,488 $14,962,261
$15,000,000 $11,895,521
Salary Related - Sewer 1,558,707 1,728,653 1,872,417
$ 10,947,895 $ 11,902,760 $ 13,231,809 $10,000,000
Total: Total: Total:
$5,000,000 $9,389,188 $10,174,107 $11,359,392
$-
Prior Year Projected Budget
Variance from Assumptions FY2020-21 FYE2021-22 FY2022-23
Rate Study Assumptions $ (947,626) $ (2,031,728) $ (1,730,452) Salary Related - Water Salary Related - Sewer
Variance % -8% -15% -12% f 2021 Rate Study Assumptions
4/26/2022
Page 12 of 82
9
W
N,'/' Non -Operating 1
Expenses
Non -Operating Expenses - Rate Study
Comparison
2021 Rate Study Assumptions
FY2020-21 FY2021-22 FY2022-23
Interest Expense $ 1,499,381 $
Other Expense 150,889
$ 1,650,270 $
Historic & Future
1,438,919 $
1,374,681
153,907
156,985
1,592,826 $
1,531,666
Prior Year
Projected
Budget
FY2020-21 FYE2021-22
FY2022-23
Interest Expense $ 1,293,830 $
1,248,225
$ 2,436,750
Other Expense 859,403
20,703
18,135
$ 2,153,233 $
1,268,928
$ 2,454,885
Variance from Assumptions
Rate Study Assumptions $ 502,963
$ (323,898)
$ 923,219
Variance % 30%
-20%
60%
4/26/2022 Page 14 of 82
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Page 15 of 82
Debt Service Ratio For Water Fund
2021 Rate Study Assumptions
FY2020-21 FY2021-22 FY2022-23
Debt Service $ 2,729,381
Ratio 1.75
Per Policy 2.25
Historic & Future
$ 2,728,919
2.14
2.25
$ 3,107,326
2.98
2.25
Prior Year Projected Budget
FY2020-21 FYE2021-22 FY2022-23
Debt Service $ 2,729,381 $ 2,728,919 $ 3,686,750
Ratio 2.38 1.57 1.89
Per Policy 2.25 2.25 2.25
Variance from Assumptions
Rate Study Assumptions 0.63 (0.57) (1.09)
Variance % 36% -27% -37%
4/26/2022 Page 16 of 82
13
Debt Coverage Analysis
Current Rates
- g% Increase
- $35 million of Debt
- Does not meet policy debt coverage.
- The district will not meet the policy debt coverage and the reserve will not meet the minimum balance
until FY2025-26.
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Water Revenue Adjustments & Debt Coverage
3.00x
2.50x
— 2.00x
1.50x
— 1.00x
0.50x
— 0.0ox
FY 2023 FY 2024 FY 2025 FY 2026
D Water Rev Adjustments Water Debt Coverage (excl. LOC)
• • • Min Debt Coverage - 1.25x 0 Alert Coverage
Policy Debt Coverage - 2.25x
$60
$50
$40
$30
$20
$10
$0
Projected Ending Balances (excl Debt Proceeds)
$20 1
$23
FY 2023 FY 2024
D Unrestricted Ending Balances
• • • Min Targets
FY 2025
Target Balances
• Alert Balances
FY 2026
4/26/2022 Page 17 of 82
Debt Coverage Analysis Cont.
Rate Increase to Meet Coverage
- 12% Increase
- $35 million of Debt
- Meets policy debt coverage in FY2023-24.
- The district meets the policy debt coverage and minimum reserve balance.
Water Revenue Adjustments & Debt Coverage
14.0% 4.50x
12.0% 4.00x
10.0% 3.50x
3.00x
8.0% 2.50x
6.0% 2.00x
4.0% ..... ..... ..... 1.50x
1.00x
2.0% 0.50x
0.0% — O.00x
FY 2023 FY 2024 FY 2025 FY 2026
Water Rev Adjustments Water Debt Coverage (excl. L0,
• • • Min Debt Coverage - 1.25x • Alert Coverage
Policy Debt Coverage - 2.25x
N $60
c
$50
$40
$30
$20
$10
$0
Projected Ending Balances (excl Debt Proceeds)
..............
$21
FY 2023 FY 2024
D Unrestricted Ending Balances
• • • Min Targets
FY 2025 FY 2026
Target Balances
• Alert Balances
4/26/2022 Page 18 of 82
15
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Page 19 of 82
Revised - Revenue
Revision Explanation
Revenue has been adjusted because of a small calculation error and to include the OCWD Treatment Plant
reimbursement from FY2021-22. Net effect of revision is $214,029 increase in revenue.
2021 Rate Study Assumptions
Prior Year
Projected
Budget
FY2020-21
FY2021-22
FY2022-23
FY2022-23
Operating Revenue $ 36,924,220
$ 40,843,348
$ 43,675,424
$ 43,675,424
Non -Operating Revenue 2,795,846
2,883,985
2,885,451
2,885,451
$ 39,720,066
$ 43,727,333
$ 46,560,875
$ 46,560,875
Historic & Future Revenue
4/26/2022 Page 20 of 82
17
Prior Year
Projected
Budget
Revised Budget
FY2020-21
FYE2021-22
FY2022-23
FY2022-23
Operating Revenue
$ 39,250,600
$ 38,426,328
$ 42,108,065
$ 42,260,299
Non -Operating Revenue
3,568,724
5,784,790
5,936,972
5,998,767
$ 42,819,324
$ 44,211,118
$ 48,045,037
$ 48,259,066
Rate Study Variance $
$ 3,099,258
$ 483,785
$ 1,484,162
$ 1,698,191
Variance %
8%
1%
3%
4%
4/26/2022 Page 20 of 82
17
Revised -Variable Costs Detail
2021 Rate Study Assumptions
Historic & Future Variable Costs
FY2020-21
FY2021-22
FY2022-23
FY2022-23
Groundwater Purchases
$ 4,367,687
$ 4,491,632
$ 6,998,164
$ 6,998,164
OCWD Annexation Fee
521,476
531,906
542,544
542,544
Power Costs
1,222,191
1,283,301
1,347,466
1,347,466
Import Water Purchases
10,285,918
10,562,707
5,447,368
5,447,368
MWDOC Fixed Costs
807,812
832,046
857,008
857,008
MWDOC Fixed Costs
$ 17,205,084
$ 17,701,592
$ 15,192,550
$ 15,192,550
Historic & Future Variable Costs
Rate Study Variance $
Variance %
4/26/2022
$ 1,433,387 $ 3,065,207 $ 1,845,553 $ 2,493,524
8% 17% 12% 16%
Page 21 of 8218
Prior Year
Projected
Original Budget
Revised Budget
FY2020-21
FYE2021-22
FY2022-23
FY2022-23
Groundwater Purchases
$ 5,221,074
$ 3,387,389
$ 8,008,387
$ 8,214,485
OCWD Annexation Fee
521,476
645,141
670,947
670,947
Power Costs
1,541,594
1,187,160
1,868,066
2,189,451
Import Water Purchases
10,573,060
14,526,451
5,391,950
5,442,283
MWDOC Fixed Costs
781,267
1,020,658
1,098,752
1,168,908
$ 18,638,471
$ 20,766,799
$ 17,038,102
$ 17,686,074
Rate Study Variance $
Variance %
4/26/2022
$ 1,433,387 $ 3,065,207 $ 1,845,553 $ 2,493,524
8% 17% 12% 16%
Page 21 of 8218
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Page 22 of 82
Financial Summary - Consolidated
Prior Year Projected Budget
Revenue FY2020-21 FYE2021-22 FY2022-23
Revenue (Operating) $ 39,250,600 $ 38,426,328 $ 42,260,299
Revenue (Non -Operating) 3,568,724 5,784,790 5,998,767
Total Revenue $ 42,819,324 $ 44,211,118 $ 48,259,066
Rate Study Assumptions $ 39,720,066 $ 43,727,333 $ 46,560,875
Variance % 8% 1% 4%
Expenses
Expenses (Operating):
Variable Costs $ 18,638,471 $ 20,766,799 $ 17,686,074
Salary Related Expenses 10,947,895 11,902,760 13,231,809
Supplies & Services 5,459,423 6,507,308 9,684,245
Expenses (Non -Operating) 2,153,233 1,268,928 2,454,885
Total Expenses $ 37,199,022 $ 40,445,795 $ 43,057,013
Rate Study Assumptions $ 37,955,574 $ 40,460,380 $ 39,954,965
Variance % -2% 0% 8%
Net Position Before Capital Contributions &
Depreciation $ 5,620,302 $ 3,765,323 $ 5,202,053
4/26/2022 Page 23 of 82
20
Financial Summary -Water
Revenue Prior Year
FY2020-21
Revenue (Operating) $ 36,374,319
Revenue (Non -Operating) 3,459,038
Total Revenue $ 39,833,357
Rate Study Assumptions $ 36,914,814
Variance % 8%
Expenses
Expenses (Operating):
Variable Costs
Salary Related Expenses
Supplies & Services
Expenses (Non -Operating)
Total Expenses
Rate Study Assumptions
Variance
Net Position Before Capital Contributions &
Depreciation
$ 18,638,471
9,389,188
4,465,134
2,137,203
$ 34,629,996
$ 34,860,572
-1
Projected
FYE2021-22
$ 35,120,509
5,588,271
$ 40,708,780
$ 40, 519, 621
0%
$ 20,766,799
10,174,107
5,486,003
1,256,936
$ 37,683,845
$ 37,403,679
Budget
FY2022-23
$ 38,471,900
5,928,772
$ 44,400,672
$ 42,892,602
4%
$ 17,686,074
11,359,392
8,376,801
2,449,100
$ 39,871,367
$ 36,726,802
9%
$ 5,203,361 $ 3,024,935 $ 4,529,305
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Debt Service
$ 2,729,381
$ 2,728,919
$ 3,686,750
Ratio
2.38
1.57
1.89
Per Policy
2.25
2.25
2.25
4/26/2022 Page 24 of 82
21
Financial
Summary - Sewer
Prior Year
Projected
Budget
Revenue
FY2020-21
FYE2021-22
FY2022-23
Revenue (Operating)
$ 2,876,281
$
3,305,819
$
3,788,399
Revenue (Non -Operating)
109,686
196,519
69,995
Total Revenue
$ 2,985,967
$
3,502,338
$
3,858,394
Rate Study Assumptions
$ 2,805,252
$
3,207,712
$
3,668,273
Variance %
6%
9%
5%
Expenses
Expenses (Operating):
Salary Related Expenses
$ 1,558,707
$
1,728,653
$
1,872,417
Supplies & Services
994,289
1,021,305
1,307,444
Expenses (Non -Operating)
16,030
11,992
5,785
Total Revenue
$ 2,569,026
$
2,761,950
$
3,185,646
Rate Study Assumptions
Variance %
Net Position Before Capital Contributions &
Depreciation
$ 3,095,002 $ 3,056,701 $ 3,228,163
-175va -10% _1%
$ 416,941 $ 740,388 $ 672,748
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4/26/2022 Page 25 of 82
22
p�! Summary of
Rates & Other
„J y,
Considerations
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Effect on Customer Bill
Avg Monthly Bill w/o CFC $ 100.20 $ 109.85 $ 110.60 $ 111.57
Avg Monthly Bill w/ CFC $ 109.66
Other Considerations
Pass -Through Power Cost with $0.04 on Commodity
Pass -Through Power Cost with $0.09 on Commodity
Remove Townsend Grant Service expense of $24k.
Remove all travel and conferences of $119k.
Remove "Loss of Revenue" Coverage
Increase Insurance Deductible
Already removed — PARS Contributions
$ 120.17
Commodity Rate from
$2.88 to $2.92
Commodity Rate from
$2.88 to $2.97
N/A
N/A
N/A
TBD
N/A
$ 120.89
$ 121.79
Increase operating revenue by $275,890 or 0.65%
Increase operating revenue by $620,752 or 1.5%
Reduce supplies & services by $24,000 or 0.25%
Reduce supplies & services by $119,330 or 1.2%
Reduce supplies & services by $25,000 or 0.26%
TBD
Reduced salary related expenses by $1,087,325 or 8%
4/26/2022 Page 27 of 82
24
FY2022-23 Proposed Rates
Water Rates
AM
Sewer Rates
5/8
3/4
1
11/2
2
3
4
6
Residential — SFR
Residential Master Metered — MFR
Commercial
4/26/2022
$ 30.14
$ 30.14
$ 47.02
$ 89.17
$ 139.45
$ 299.96
$ 536.03
$ 1,353.89
$ 10.99
$ 10.57
$ 10.99
Meter Size Capital Finance
Charge
5/8
$ 74.28
3/4
$ 74.28
1
$ 123.84
11/2
$ 247.44
2
$ 395.64
3
$ 865.20
4
$ 1,557.00
6
$ 3,954.24
Tier 1 (0-7 ccfs per month)
Tier 2 (8+ ccfs per month)
4 $ 8.56
6 $ 22.43
8 $ 46.37
10 $ 82.37
$ 0.00
$ 0.43
Page 28 of 82
25
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Page 29 of 82
Revised - 5 -Yr CIP
FY23 Budget
to
PROJECT NAME
FY23
FY24
FY25
FY26
FY27
TOTAL
Hidden Hills BPS Upgrades
1,407,603
-
1,407,603
Timber Ridge BPS Pump Replacement
4,199,550
1,399,850
5,599,400
Well 22 Equipping
1,901,208
-
1,901,208
BNSF Crossing -Weir Canyon / YL Blvd
134,655
134,655
BNSF Crossing -Veteran's Village and Highland
1,975,557
-
-
-
-
1,975,557
Resiliency Improvements to District Facilities (AWIA)
220,000
275,000
275,000
275,000
11045,000
Site and Security Upgrades at District Facilities (AWIA)
220,000
275,000
275,000
275,000
11045,000
Well Rehabilitation Project
165,000
165,000
165,000
165,000
660,000
Lakeview BPS Piping
330,000
-
-
-
-
330,000
Waterline Replacement *Based on AMP and Leak History
10,000
2,877,600
1,210,000
1,210,000
1,210,000
6,517,600
PRS Rehabilitation Project *Based on AMP and Asset Scores
-
803,100
1,320,000
1,320,000
1,320,000
4,763,100
Golden Ave Waterline
266,805
-
-
-
266,805
Santiago BPS Rehab
-
1,819,070
-
1,819,070
Well 23 Drilling & Equipping
549,500
1,185,400
2,705,000
-
-
4,439,900
Total Water CIP $
10,508,073 $
8,956,825
$
5,950,000
$
3,245,000
$
3,245,000
$
31,904,898
Main Street and YL Pines Sewer
813,000
-
-
-
-
813,000
Green Crest Lift Station Rehab
-
385,500
385,500
Sewer System Rehabilitation and Replacement Project
396,000
440,000
836,000
Sewer in LDS Temple Parking Lot
-
-
-
-
Buena Vista Sewer Main Flow Reversal
-
-
1,130,500
1,130,500
Total Sewer CIP $
813,000 $
781,500
$
-
$
440,000
$
1,130,500
$
3,165,000
CIP Total $
11,321,073 $
9,738,325
$
5,950,000
$
3,685,000
$
4,375,500
$
35,069,898
CAPITAL OUTLAY
FY23
FY24
FY25
FY26
FY27
TOTAL
Network Redesign
30,000
-
-
-
-
30,000
Records Scanner
8,000
-
-
-
-
8,000
Operations Department
1,725,000
516,000
505,000
710,000
820,000
4,276,000
Outlay Total $
1,763,000 $
516,000
$
505,000
$
710,000
$
820,000
$
4,314,000
Grand Total $
13,084,073 $
10,254,325
$
6,455,000
$
4,395,000
$
5,195,500
$
39,383,898
Page 30 of 82
4/26/2022
27
Yorba Linda
Water District
Page 31 of 82
Overview
• Supplies & Services
• Salaries & Related Expenses
• Non -Operating Expenses
• Debt Service
• Revised Budget
• Summary of FY2022-23 Budget
• Summary of Rates& Other Considerations
• Revised CIP
4/26/2022 Page 32 of 82
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Page 33 of 82
Supplies & Services Analysis
2,000,000
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
� 2021 Actuals
� 2022 Projections
0 2023 Budget
--W-2021 Rate Study
Historic Trends - Supplies & Services
FY21, FY22 Projections, FY23 Budget
YL
SIL
252,843
W555,422
340,893
529,772
i3a,�oa i
351,708
� �
48,973
104,815
�
_
Communicati
Contractual
Data
District
Meetings &
Dues &
Fees &
Insurance
Maintenance
Materials
ons
Services
Processing
Events
Memberships
Permits
164,667
715,712
311,867
24,031
87,809
362,050
274,975
800,876
719,502
140,985
551,996
322,529
34,995
103,366
441,182
284,869
1,576,275
714,317
193,000
614,039
421,614
45,500
97,522
467,990
434,590
* 2,032,733
1,001,300
252,843
555,422
340,893
48,973
104,815
529,772
351,708
738,268
725,679
Variances Explanations for Impactful Expenses - 2023 Budget to 2022 Projections
Contractual Services -The increase of 11%from FY22 Projections is due to new contracts for janitorial and landscaping services that will beat a higher
cost than the current contracts. These expenses were originally budgeted for FY22 but are now being moved to FY23 Budget. The increase is also due to
mailing and printing of backflow inserts to customers.
Data Processing -The increase of 31% from FY22 Projections is due to additional software licenses from Microsoft and to purchase additional Dell
support.
Insurance - The increase of 53% from FY22 Projections is due to increase in premium rates, ACWA-JPIA Property insurance coverage for the PFAS
Treatment Plant and Cybersecurity Insurance.
Maintenance -The increase of 29% from FY22 Projections is due to pavement program costs inherited from City of Yorba Linda and Placentia,
maintenance of root control, building 4 lobby door replacement, chlorine building roof repair, concrete work at Lakeview Reservoir and SCADA AGB
Earthquake Testing.
Materials - The increase of 40% from FY22 Projections is due to the completion of capitalized grant project and will resume regular maintenance
schedule and increase cost of meter replacements. The increase is also due to replacing 5 methane sensors at various sites.
4/26/2022 *Amounts have been updated from posted agON a4 of 82
4
Supplies & Services Analysis Cont.
1,800,000
Professional
Developmen
1,600,000
Board
Services
1,400,000
e Accounts
35,857
1,200,000
45,362
1,385,819
1,000,000
1,713,760
65,738
800,000
600,000
11,338
171,510
400,000
194,213
61,500
200,000
10,000
39,093
0
137,000
1,422,000
50,147
Non Capital
Office
394,728
Equipment
Expense
� 2021 Actuals
197,846
39,759
� 2022 Projections
167,579
41,817
1 2023 Budget
204,300
42,300
- 2021 Rate Study
194,213
39,093
Historic Trends - Supplies & Services
FY21, FY22 Projections, FY23 Budget
Professional
Professional
Developmen
Vehicle
Board
Services
t
e Accounts
35,857
1,025,746
45,362
1,385,819
85,550
1,713,760
65,738
1,007,226
Travel &
Uncollectibl
Vehicle
Board
Conferences
e Accounts
Utilities
Expenses
Election
PFAS
10,248
15,907
202,964
469,612
43,529
11,338
171,510
408,341
61,500
119,330
10,000
224,000
538,550
137,000
1,422,000
50,147
10,196
212,508
394,728
94,156
819,467
Variances Explanations for Impactful Expenses - 2023 Budget to 2022 Projections
Professional Services - The increase of 24% from FY22 Projections is due to the Water Master Plan and Hydraulic Modeling, Cyber Security Analysis
and Compensation Study.
Travel & Conferences - The increase of 174% from FY22 Projections is due to less COVID restrictions for conferences and events.
Vehicle Expenses -The increase of 32% from FY22 Projections is due to gas and diesel prices increasing.
4/26/2022
Page 35 of 82
5
Supplies & Services - Rate Study
Comparison
202iRate Study Assumptions
FY2020-21
FY2021-22
FY2022-23
Supplies & Services - Water $ 4,651,466
$ 4,959,410
$ 5,533,227
$12,000,000
Supplies & Services - Sewer 1,323,233
982,065
1,002,617
$ 5,974,699
$ 5,941,475
$ 6,535,844
$10,000,000
$8,000,000
$6,000,000
Historic & Future
$4,000,000
Prior Year
Projected
Budget
$2,000,000
FY2020-21
FYE2021-22
FY2022-23
Supplies & Services - Water $ 4,465,134 $ 5,486,003 $ 8,467,358
Supplies & Services - Sewer 994,289 1,021,305 1,337,720
$ 5,459,423 $ 6,507,308 $ 9,805,078
Variance from Assumptions
Rate Study Variance $ $ (515,276) $ 565,833
Variance % -9% 10%
4/26/2022
$ 3,269,234
50%
FY23 Budget Supplies & Services
$6,535,844
$5,974,699 $5,941,475
Prior Year Projected Budget
FY2020-21 FYE2021-22 FY2022-23
Supplies & Services - Water � Supplies & Services - Sewer
f 2021 Rate Study Assumptions
P e 36 of 82
*Amounts have been updated from posted agence 6
Supplies & Services — Off Trend Expenses
Description: Off trend expenses are expenses that have not been consistent annual operating expenditures.
This is to help compare supplies and services of the District from year to year.
Off Trend Expenses
Description
Board Election
Additional Cost - City of Yorba Linda & Placentia Pavement Program
Water Master Plan & Hydraulic Modeling
Compensation Study
Total
Supplies & Services without Off Trend Expenses
Supplies & Services — Total Expenses
Off Trend Expenses (Minus)
Variance Increase/Decrease Year to Year
Variance $
Variance
Department
Board of Directors
Engineering
Engineering
Human Resources
Amount
$ 137,000
664,833
550,000
60,000_
$ * 1,411,833
Projections Budget
FYE2021-22 FY2022-23
$ 6,507,308 $ 9,805,078
0 (1,411,833)
$ 6,507,308 $ * 8,393,245
FY22 Projections to
FY23 Budget
$ * 1,885,934
29%
Variance Explanation
The cost of operating the PFAS treatment plant is projected to be s61,soo for FY22 Projections and
budgeted at $1,422,000 for FY23. This makes up the majority of the increase in the total budget between the
two years.
YL
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l J
Pa
4/26/2022 *Amounts have been updated from posted agence 37 of 82 7
W
N,'/' Salary Related 1
Expenses IWO.
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Salary Related Expenses - Rate Study
Comparison
2021 Rate Study Assumptions
FY2020-21 FY2021-22 FY2022-23
Salary Related - Water $ 10,156,647 $ 11,893,405 $ 12,770,939
Salary Related - Sewer 1,738,874 2,041,083 2,191,322
$ 11,895,521 $ 13,934,488 $ 14,962,261
Historic & Future
Prior Year
FY2020-21
Salary Related - Water $ 9,389,188 $
Salary Related - Sewer 1,558,707
$ 10,947,895 $
*Variance Explanation
PARS Contributions is included in the Rate Study
with the amount of $1,o87,325 for both FY22 and
FY23. There have been no PARS Contributions for
PriorYear FY21, Projections FY22 or Budget FY23.
$16,000,000
$14,000,000
Projected Budget
FYE2021-22 FY2022-23 $12,000,000
$10,000,000
10,174,107 $ 11,359,392 $8,000,000
1,728,653 1,872,417 $6,000,000
11,902,760 $ 13,231,809 $4,000,000
$2,000,000
Variance from Assumptions
Rate Study Assumptions
Variance %
4/26/2022
$ (947,626) $ (2,031,728) $ (1,730,452)
-8% -15% -12%
FY23 Budget Salary Related Expenses
$
$13,934,488 14,962,261
$11,895,521
FY2020-21 FY2021-22 FY2022-23
Salary Related - Water Salary Related - Sewer
• 2021 Rate Study Assumptions
*Amounts have been updated from posted ageNR of 82
9 9
W
N,'/' Non -Operating 1
Expenses
-W
Non -Operating Expenses - Rate Study
Comparison
2021 Rate Study Assumptions
FY2020-21 FY2021-22 FY2022-23
Interest Expense $ 1,499,381 $
Other Expense 150,889
$ 1,650,270 $
Historic & Future
1,438,919 $
1,374,681
153,907
156,985
1,592,826 $
1,531,666
Prior Year
Projected
Budget
FY2020-21 FYE2021-22
FY2022-23
Interest Expense $ 1,293,830 $
1,248,225
$ 2,436,750
Other Expense 859,403
20,703
18,135
$ 2,153,233 $
1,268,928
$ 2,454,885
Variance from Assumptions
Rate Study Assumptions $ 502,963
$ (323,898)
$ 923,219
Variance % 30%
-20%
60%
4/26/2022 Page 41 of 82
11
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Page 42 of 82
Debt Service Ratio For Water Fund
2021 Rate Study Assumptions
FY2020-21 FY2021-22
Debt Service $ 2,729,381
Ratio 1.75
Per Policy 2.25
Historic & Future
$ 2,728,919
2.14
2.25
Prior Year Projected
FY2020-21 FYE2021-22
Debt Service $ 2,729,381 $ 2,728,919
Ratio 2.38 1.57
Per Policy 2.25 2.25
Variance from Assumptions
Rate Study Assumptions 0.63 (0.57)
Variance % 36% -27%
4/26/2022
FY2022-23
$ 3,107,326
2.98
2.25
Budget
FY2022-23
$ 3,686,750
1.86
2.25
(1.12)
-38%
*Amounts have been updated from posted ag�c a3 of 82
�3
Debt Coverage Analysis
FY2022-23 Proposed Rates
- g% Increase from PriorYear
- $35 million of Debt
- The District is projected to exceed policy debt coverage and the minimum target reserve balances by
FY2025-z6.
Water Revenue Adjustments & Debt Coverage
10.0% 3.00x
8.0% 2.50x
2.00x
6.0% —
1.50x
4.0% ..... ..... ..... _
1.00x
2.0% 0.50x
0.0% — O.00x
FY 2023 FY 2024 FY 2025 FY 2026
D Water Rev Adjustments Water Debt Coverage (excl. LOC
• • • Min Debt Coverage - 1.25x Policy Debt Coverage - 2.25x
$60
$50
$40
$30
$20
$10
$0
Projected Ending Balances (excl Debt Proceeds)
FY 2023 FY 2024 FY 2025 FY 2026
D Unrestricted Ending Balances
• Min Targets
Target Balances
• Alert Balances
4/26/2022 Page 44 of 82
Debt Coverage Analysis Cont.
Rate Increase Needed to Meet District Policies
- 12% Increase in FY2022-23 then g% in the following years.
- $35 million of Debt
- The District is projected to meet policy debt coverage and the minimum target reserve balances by
FY2o24-25.
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Water Revenue Adjustments & Debt Coverage
FY 2023 FY 2024 FY 2025 FY 2026
3.50x
3.00x
2.50x
2.00x
1.50x
1.00x
0.50x
O.00x
C� Water Rev Adjustments Water Debt Coverage (excl. LOC)
Min Debt Coverage - 1.25x Policy Debt Coverage - 2.25x—
N $60
c
$50
$40
$30
$20
$10
$0
Projected Ending Balances (excl Debt Proceeds)
.... ....
1 0 • $32
$21
FY 2023 FY 2024
D Unrestricted Ending Balances
• • • Min Targets
FY 2025
i arget tsaiances
• Alert Balances
$41
FY 2026
4/26/2022 Page 45 of 82
15
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Page 46 of 82
Revised - Revenue
Revision Explanation
Revenue has been adjusted because of a small calculation error and to include the OCWD Treatment Plant
reimbursement from FY2021-22. Net effect of revision is an increase in revenue of $214,029.
2021 Rate Study Assumptions
Operating Revenue
Non -Operating Revenue
FY2020-21
$ 36,924,220
2,795,846
$ 39,720,066
Historic & Future Revenue
Operating Revenue
Non -Operating Revenue
Rate Study Variance $
Variance
FY2021-22
$ 40,843,348
2,883,985
$ 43,727,333
FY2022-23
$ 43,675,424
2,885,451
$ 46,560,875
FY2022-23
$ 43,675,424
2,885,451
$ 46,560,875
4/26/2022 Page 47 of 82
17
BudgetFY2022-23
Prior Year
Projected
Presented on
Revised Budget
FY2020-21
FYE2021-22
3/22/22
FY2022-23
$ 39,250,600
$ 38,426,328
$ 42,108,065
$ 42,260,299
3,568,724
5,784,790
5,936,972
5,998,767
$ 42,819,324
$ 44,211,118
$ 48,045,037
$ 48,259,066
$ 3,099,258
$ 483,785
$ 1,484,162
$ 1,698,191
8%
1%
3%
4%
4/26/2022 Page 47 of 82
17
Revised -Variable Costs Detail
2021 Rate Study Assumptions
Historic & Future Variable Costs
FY2020-21
FY2021-22
FY2022-23
FY2022-23
Groundwater Purchases
$ 4,367,687
$ 4,491,632
$ 6,998,164
$ 6,998,164
OCWD Annexation Fee
521,476
531,906
542,544
542,544
Power Costs
1,222,191
1,283,301
1,347,466
1,347,466
Import Water Purchases
10,285,918
10,562,707
5,447,368
5,447,368
MWDOC Fixed Costs
807,812
832,046
857,008
857,008
MWDOC Fixed Costs
$ 17,205,084
$ 17,701,592
$ 15,192,550
$ 15,192,550
Historic & Future Variable Costs
Rate Study Variance $ $ 1,433,387 $ 3,065,207 $ 1,845,553 $ 2,493,524
Variance % 8% 17% 12% 16%
4/26/2022 Page 48 of 8218
Prior Year
Projected
Budget FY2022-23
Revised Budget
FY2020-21
FYE2021-22
Presented on 3/22/22
FY2022-23
Groundwater Purchases
$ 5,221,074
$ 3,387,389
$ 8,008,387
$ 8,214,485
OCWD Annexation Fee
521,476
645,141
670,947
670,947
Power Costs
1,541,594
1,187,160
1,868,066
2,189,451
Import Water Purchases
10,573,060
14,526,451
5,391,950
5,442,283
MWDOC Fixed Costs
781,267
1,020,658
1,098,752
1,168,908
$ 18,638,471
$ 20,766,799
$ 17,038,102
$ 17,686,074
Rate Study Variance $ $ 1,433,387 $ 3,065,207 $ 1,845,553 $ 2,493,524
Variance % 8% 17% 12% 16%
4/26/2022 Page 48 of 8218
PME=q
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Page 49 of 82
Financial
Summary - Consolidated
Prior Year
Projected
Budget
Revenue
FY2020-21
FYE2021-22
FY2022-23
Revenue (Operating)
$
39,250,600
$
38,426,328
$
42,260,299
Revenue (Non -Operating)
3,568,724
5,784,790
5,998,767
Total Revenue
$
42,819,324
$
44,211,118
$
48,259,066
Rate Study Assumptions
$
39,720,066
$
43,727,333
$
46,560,875
Variance %
8%
1%
4%
Expenses
Expenses (Operating):
Variable Costs
$
18,638,471
$
20,766,799
$
17,686,074
Salary Related Expenses
10,947,895
11,902,760
13,231,809
Supplies & Services
5,459,423
6,507,308
9,805,078
Expenses (Non -Operating)
2,153,233
1,268,928
2,454,885
Total Expenses
$
37,199,022
$
40,445,795
$
43,177,846
Rate Study Assumptions
$
36,725,574
$
39,170,380
$
38,222,320
Variance %
1%
3%
13%
Net Position Before Capital Contributions &
Depreciation
$
5,620,302
$
3,765,323
$
5,081,220
Capital Contributions
2,051,988
8,966
-
Depreciation
7,858,355
8,769,648
9,500,000
Total Net Income (Loss)
$
(186,065)
$
(4,995,359)
$
(4,418,780)
RMMM
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la 0 of 82
4/26/2022 *Amounts have been updated from posted a ghu20
Financial
Summary -Water
Prior Year
Projected
Budget
Revenue
FY2020-21
FYE2021-22
FY2022-23
Revenue (Operating)
$
36,374,319
$
35,120,509
$
38,471,900
Revenue (Non -Operating)
3,459,038
5,588,271
5,928,772
Total Revenue
$
39,833,357
$
40,708,780
$
44,400,672
Rate Study Assumptions
$
36,914,814
$
40,519,621
$
42,892,602
Variance %
8%
0%
4%
Expenses
Expenses (Operating):
Variable Costs
$
18,638,471
$
20,766,799
$
17,686,074
Salary Related Expenses
9,389,188
10,174,107
11,359,392
Supplies & Services
4,465,134
5,486,003
8,467,358
Expenses (Non -Operating)
2,137,203
1,256,936
2,449,100
Total Expenses
$
34,629,996
$
37,683,845
$
39,961,924
Rate Study Assumptions
$
33,630,572
$
36,113,679
$
34,994,157
Variance %
3%
4%
14%
Net Position Before Capital Contributions &
Depreciation
$
5,203,361
$
3,024,935
$
4,438,748
Capital Contributions
1,297,379
8,966
-
Depreciation
6,380,976
7,282,836
8,005,000
Total Net Income (Loss)
$
119,764
$
(4,248,935)
$
(3,566,252)
Debt Service
Ratio
Per Policv
4/26/2022
$ 2,729,381 $ 2,728,919 $ 3,686,750
2.38 1.57 1.86
2.25 2.25 2.25
YL
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*Amounts have been updated from posted agghlua1 of 82
21
Financial
Summary - Sewer
Prior Year
Projected
Budget
Revenue
FY2020-21
FYE2021-22
FY2022-23
Revenue (Operating)
$ 2,876,281
$
3,305,819
$
3,788,399
Revenue (Non -Operating)
109,686
196,519
69,995
Total Revenue
$ 2,985,967
$
3,502,338
$
3,858,394
Rate Study Assumptions
$ 2,805,252
$
3,207,712
$
3,668,273
Variance %
6%
9%
5%
Expenses
Expenses (Operating):
Salary Related Expenses
$ 1,558,707
$
1,728,653
$
1,872,417
Supplies & Services
994,289
1,021,305
1,337,720
Expenses (Non -Operating)
16,030
11,992
5,785
Total Revenue
$ 2,569,026
$
2,761,950
$
3,215,922
Rate Study Assumptions
Variance %
Net Position Before Capital Contributions &
Depreciation
Capital Contributions
Depreciation
*Total Net Income (Loss)
$ 3,095,002 $ 3,056,701 $ 3,228,163
-175vo -10% 0%
$ 416,941 $ 740,388
754,609 -
1,477,379 1,486,812
$ (305,829) $ (746,424)
$ 642,472
1,495,000
$ (852,528)
�YL
L � J
*Amounts have been updated from posted aPaqqgerrua 2 of 82 22
4/26/zozz p
p�! Summary of
Rates & Other
„J y,
Considerations
0_..
A*".
W
* Effect on Customer Bill
FY2022-23
Billing FY2021-22 w/ 9% Wtr & 15% Swr Adj1111
Avg Monthly Bill w/ CFC $ 109.66 $ 120.17 $ 120.53
$10.8]
*Other Considerations 9.9:L%
Pass -Through Power Cost with $0.02 on Commodity Commodity Rate from Increase operating revenue by $137,945 or 0.28%
$2.88 to $2.90
Remove Townsend Grant Service expense of $24k. N/A Reduce supplies & services by $24,000 or 0.25%
Remove all travel and conferences of $119k. N/A Reduce supplies & services by $119,330 or 1.2%
Remove "Loss of Revenue" Coverage N/A Reduce supplies & services by $25,000 or 0.26%
Already removed — PARS Contributions N/A Reduced salary related expenses by $1,087,325 or 8%
4/26/2022 *Amounts have been updated from posted ages 4 of 82
�4
FY2022-23 Proposed Rates
Water Rates
Sewer Rates
Meter Type Tr Monthly Service
Charge
Residential — SFR $ 10.99
Residential Master Metered — MFR $ 10.57
Commercial $ 10.99
4/26/2022
4 $ 8.56
6 $ 22.43
8 $ 46.37
10 $ 82.37
Tier 1 (0-7 ccfs per month) $ 0.00
Tier 2 (8+ ccfs per month) $ 0.43
*Amounts have been updated from posted ages 5 of 82
�5
Meter Size
Meter Size Annual Capital
$ 2.88
5/8 $ 30.14
5/8 $ 74.28
3/4 $ 30.14
3/4 $ 74.28
1 $ 47.02
1 $ 123.84
*
'
11/2 $ 89.17
11/2 $ 247.44
Through
2 $ 139.45
2 $ 395.64
$ 2.90
3 $ 299.96
3 $ 865.20
4 $ 536.03
4 $ 1,557.00
6 $ 1,353.89
6 $ 3,954.24
Sewer Rates
Meter Type Tr Monthly Service
Charge
Residential — SFR $ 10.99
Residential Master Metered — MFR $ 10.57
Commercial $ 10.99
4/26/2022
4 $ 8.56
6 $ 22.43
8 $ 46.37
10 $ 82.37
Tier 1 (0-7 ccfs per month) $ 0.00
Tier 2 (8+ ccfs per month) $ 0.43
*Amounts have been updated from posted ages 5 of 82
�5
YL
,W�
Page 56 of 82
Revised - 5 -Yr CIP
FY23 Budget
PROJECT NAME
FY2022-23
FY2023-24
Hidden Hills BPS Upgrades
1,407,603
-
Timber Ridge BPS Pump Replacement
4,199,550
1,399,850
Well 22 Equipping
1,901,208
-
BNSF Crossing -Weir Canyon / YL Blvd
134,655
FY26
BNSF Crossing -Veteran's Village and Highland
1,975,557
-
Resiliency Improvements to District Facilities (AWIA)
30,000
220,000
Site and Security Upgrades at District Facilities (AWIA)
-
220,000
Well Rehabilitation Project
165,000
Lakeview BPS Piping
330,000
-
Waterline Replacement *Based on AMP and Leak History
10,000
2,877,600
PRS Rehabilitation Project *Based on AMP and Asset Scores
-
803,100
Golden Ave Waterline
8,000
266,805
Santiago BPS Rehab
-
1,819,070
Well 23 Drilling & Equipping
549,500
1,185,400
Total Water CIP $ 10,508,073 $ 8,956,825 $
Main Street and YL Pines Sewer 813,000 -
Green Crest Lift Station Rehab - 385,500
Sewer System Rehabilitation and Replacement Project 396,000
Sewer in LDS Temple Parking Lot -
Buena Vista Sewer Main Improvements - -
Total Sewer CIP $ 813,000 $ 781,500 $
CAPITAL OUTLAY
Network Redesign
Records Scanner
Operations Department
4/26/2022
FY2024-25
275,000
275,000
165,000
1,210,000
1,320,000
2,705,000
51950,000 $
FY2025-26 FY2026-27 TOTAL
275,000
275,000
165,000
1,210,000
1,320,000
3,245,000 $
440,000
- $ 440,000 $
275,000
275,000
165,000
1,210,000
1,320,000
3,245,000 $
1,130,500
1,130,500 $
1,407,603
5,599,400
1,901,208
134,655
1,975,557
1,045,000
1,045,000
660,000
330,000
6,517,600
4,763,100
266,805
1,819,070
4,439,900
31,904,898
813,000
385,500
836,000
1,130,500
3,165,000
CIP Total $
11,321,073 $
9,738,325
$
5,950,000
$
3,685,000
$
4,375,500
$ 35,069,898
FY23
FY24
FY25
FY26
FY27
TOTAL
30,000
-
-
-
-
30,000
8,000
-
-
-
-
8,000
1,725,000
516,000
505,000
710,000
820,000
4,276,000
Outlay Total $
1,763,000 $
516,000
$
505,000
$
710,000
$
820,000
$ 4,314,000
Grand Total $
13,084,073 $
10,254,325
$
6,455,000
$
4,395,000
$
5,195,500
$ 39,383,898
Page 57 of 82
27
ITEM NO. 7.1.
' rba Linda
Water District
/_1r]=161197_11N=1a*]AI
MEETING DATE: April 26, 2022
TO: Board of Directors
FROM: Andrew B. Gagen, General Counsel
STAFF CONTACTS: Doug Davert, Interim General Manager
Rosanne Weston, Engineering Manager
SUBJECT: Due Process Hearing Regarding Award of Construction Contract
for the Hidden Hills Booster Pump Station Improvements Project
RECOMMENDATION:
Based on staff's bid review and reference check, and after the Board considers the attached
written documents (Exhibits 1 and 2) and hears oral testimony from Project bidder, MMC, Inc.,
staff recommends that the Board determine MMC, Inc. is not a responsible bidder; so, it would
not be in the District's best interests to award the Project contract to low bidder, MMC, Inc.
Instead, it is in the District's best interest to award the contract to second low bidder, Pacific
Hydrotech Corp., as discussed in Item No. 7.2 of this agenda.
SUMMARY:
As a County Water District, the District is not required to contract with the lowest bid and
responsible bidder. Instead, the District (i) has the right to award the construction contract to a
bidder other than the lowest bidder and (ii) reserves the right to reject any bid. Even though
the District is not statutorily required to procure construction contracts using competitive
bidding, the District should (not "must") conduct a hearing and make a finding that low bidder,
MMC, is not a responsible bidder so the District may award the contract to the second low
bidder, Pacific Hydrotech Corp., as discussed in Item No. 7.2 of this agenda.
FISCAL IMPACT:
Budgeted: Yes
Total Construction Cost: $2,443,910
District's Construction Cost: $1,136,418
Developer's Construction Cost: $1,307,492
Funding Source: Capital and Developer Funded
Job Nos: J-2020-20 and J-2018-27
BACKGROUND, PROCEDURE, AND ANALYSIS:
On February 9, 2022, the District received three bids for construction of the Hidden Hills
Booster Pump Station Improvements Project. The three bidders from the lowest to highest
Page 58 of 82
bids are (1) MMC, Inc., (2) Pacific Hydrotech Corp, and (3) Environmental Construction, Inc.
The bids expire on May 10, 2022.
The District's engineering staff completed a bid review and reference check of the apparent
low bidder, MMC, Inc. The results of the bid review and reference check are memorialized in a
Memorandum dated April 7th, which is attached as Exhibit 1. Based on the bid review and
reference check, the recommendation is that MMC, Inc. is not a responsible bidder and that it
would not be in the District's best interests to award the Project contract to MMC, Inc.
On April 7th the District notified MMC of its recommendation and provided MMC with a copy of
the April 7th Memorandum. The District gave MMC two opportunities to rebut the adverse
evidence and to present evidence of MMC's qualifications. In response, MMC submitted two
letters dated April 8th and April 15th, which are attached collectively as Exhibit 2.
Even though the District is not statutorily required to procure construction contracts using
competitive bidding, as described below, the District should (not "must") conduct a hearing
and make a finding that low bidder, MMC, is not responsible so the District may award the
contract to the second low bidder. Described in Exhibit 1 is the District's evidence and
recommendation that MMC is not a responsible bidder, which is based on staff's review of
MMC's bid documents and multiple negative references. At the hearing, representative(s)
from MMC, Inc. may present evidence to the Board of MMC's qualifications and to rebut the
District staff's recommendation.
In accordance with (a) caselaw, (b) the District Purchasing Policy, and (c) Project bid
documents, the District (i) has the right to award the construction contract to a bidder other
than the lowest bidder and (ii) reserves the right to reject any bid. Here is the relevant
language from those three (a) -(c) authorities.
A. CASELAW
The District is a County Water District under Water Code § 30000 et seq. so it is not
required to procure construction contracts using competitive bidding, which means the
District is able to award construction contracts in its sole discretion. The District is
required only to make a good faith effort to support the competitive selection process
described in Section 7 of the District's Purchasing Policy, which is provided next.
B. PURCHASING POLICY
7.4 Rejecting Competitive Responses - In response to an Invitation to Bid, RFQ, or
RFP, the District may reject a bid or other response which is in any way ... unqualified,
conditional or otherwise not in compliance with the solicitation documents in all material
respects, and in accordance with law....
7.5 RFPs and RFQs - The General Manager and the Board reserve the right to award
Contracts based upon the best interests of the District, as determined by the District in
its sole discretion.
11.0 County Water District Status - The District is a County Water District and
therefore is not mandated by State law to competitively bid any purchases, including
those for Public Works projects and/or capital expenditures. The District has discretion to
enter into non -bid Contracts for Public Works, to procure Services and Materials, to
contract for design -build work, to utilize job -order contracting and to enter into
Cooperative Purchasing arrangements for the design, construction and maintenance of
Page 59 of 82
Public Works, or undertake any other form of contracting determined to be in the
District's best interest, except as otherwise expressly restricted by law. Notwithstanding
this lack of legal mandate and contractual discretion, District staff shall make a good
faith effort to support the Competitive Selection Process described in Section 7.
C. PROJECT BID DOCUMENTS
1. Information For Bidders
OWNER'S RESERVED RIGHTS: The Owner reserves the right, in its sole discretion, to
reject any or all Bids ....
AWARD OF CONTRACT: In accordance with both Owner's Purchasing Policy and the
Contract Documents, award of a Contract, if it be awarded, will be based primarily, but
not exclusively, on the lowest overall cost to the Owner, and will be made to a
responsible Bidder whose Bid is responsive to the bid requirements prescribed in the
Contract Documents.... The Owner reserves the right, in its sole discretion, to award
the Contract to other than the lowest Bidder pursuant to its discretionary authority under
its Purchasing Policy and the County Water District Law and in the interests of the
Owner.
2. Project Bid
The Owner reserves the right, in its sole discretion, to (1) reject any and all Bids, (2)
waive any informality or irregularity, and (3) award the Contract to other than the lowest
Bidder if in the best interests of the Owner.
The Bidder will accept an award and enter into an Agreement for all Work scheduled
herein on which it submits a Bid. The awards for such Work are to be entirely at the
discretion of Owner after evaluation of the submitted Bids.
PRIOR RELEVANT BOARD ACTION:
On June 22, 2021, the Board of Directors approved the Hidden Hills Booster Pump Station
Improvements Project as part of the FY21-22 Annual Budget Document.
STRATEGIC PLAN INITIATIVES:
G1 4A - Address infrastructure needs by updating/implementing the Asset Management Plan.
G3 2B -Address the District's future infrastructure needs.
ATTACHMENTS:
1. Exhibit 1
2. Exhibit 2
Page 60 of 82
Yorba Linda
Water District
Serving the Community Since 1909
MEMORANDUM
To: Rosanne Weston, PE, PMP
From: Ammar Tohmeh, PE and Danielle Logsdon, PE, PMP
Subject: Award Recommendation for Hidden Hills Booster Pump Station Project
regarding MMC
Date: 4/7/2022
On February 9, 2022, the District received three (3) bids for construction of the
Hidden Hills Booster Pump Station — Project No. J-2018-27. The bid results are
shown in the summary below:
No. Contractor Total Bid Amount
1 MMC, Inc. $2,378,250.00
2 Pacific Hydrotech Corp. $2,443,910.00
3 Environmental Construction, Inc. $2,632,868.90
A bid review and reference check of the apparent low bidder, MMC, Inc., was
completed. The results of the bid review and reference check are as follows:
With regards to the bid documents review, there were no errors in the schedule
of bid items, and MMC, Inc. submitted all of the required documents. However,
MMC, Inc. did not list subcontractors for either the HVAC or Roofing scope of
work. Jay Mehta with MMC, Inc. stated that they will be self -performing the
majority of that work and that the remaining work performed by the
subcontractors for the HVAC and Roofing was less than 0.5% of the total bid,
which is why they were not listed.
It should be noted that 0.5% of the total bid equals $11,891.25 and that the Bid
Schedule Item amounts for HVAC and Roofing are $35,000 and $75,000,
respectively.
The District informed MMC, Inc. that per the Contract Documents, Technical
Specifications Section 07534 — EPDM Roofing, the bidder is required to "Engage
experienced installer to perform Work of this Section who has specialized in
installing roofing similar to that required for this Project; who is approved,
authorized, or licensed by the roofing system Manufacturer to install
PO Box 309, Yorba Linda CA 92885 714-701-3000 www.ylwd.com
J. Wayne Miller, PhD Brooke Jones Trudi Kew Des Roches Phillip D. Hawkins Tom Lindsey
President Vice President Director Director Director
Page 61 of 82
Manufacturer's product; and who is eligible to receive the standard roofing
Manufacturer's warranty." Jay responded with a quote from Saddleback Roofing,
Inc., which totaled $11,000.
With regards to the reference check, an attempt was made to contact a total of
fourteen (14) references; five (5) of the references answered or returned the call.
The first project was an instrumentation project that had a contract amount of
approximately $3,000,000, which started in September 2019 and was completed
January 2022. John Vrsalovich with Metropolitan Water District (MWD) stated
that MMC, Inc. had completed several jobs for MWD in the past decade, that
they get the work done, but that there have been delays. He stated that MWD did
not assess liquidated damages for the delays but that they just worked the delays
out with MMC, Inc.
The second project was a well equipping project and treatment plant
improvements project that had a contract amount of approximately $6,400,000,
which started in March 2020 and, according to the reference document submitted
by MMC, Inc., was completed in June 2021. However, Adriana Figueroa with the
City of Paramount stated that the project was still on-going and that she did not
want to discuss it with me at this time.
The third project was a storm water capture project that had a contract amount of
approximately $4,350,000, which started in March 2018 and, according to the
reference document submitted by MMC, Inc., was completed in June 2019.
Rommel Garcia with the Los Angeles County Sanitation District (LACSD) stated
that the project has yet to be closed out and that there is a dispute involved in the
project, but did not give any details with regards to the dispute.
The fourth and fifth projects were two (2) separate sewer lift station projects for
the City of Huntington Beach. One project had a contract amount of
approximately $4,000,000, started in May 2020, and according to the reference
document submitted by MMC, Inc., was completed in April of 2021. The other
project had a contract amount of approximately $3,700,000, started in June
2020, and according to the reference document submitted by MMC, Inc., was
completed in June 2021. John with the City of Huntington Beach stated that each
project has over 6 months of delays and that the City of Huntington Beach was
going to assess liquidated damages of over $150,000 for each project. He stated
that MMC, Inc. is typically responsive but that they struggle with safety and do
not always have a foreman on-site. He also stated that in their bid documents,
they claimed that they were going to self -perform certain work but brought in an
unlisted subcontractor during the project to perform the work instead. Finally, he
Page 62 of 82
stated that the City of Huntington Beach is taking steps to prevent MMC, Inc.
from bidding on future projects with them.
The sixth project was a sewer lift station project that had a contract amount of
approximately $2,200,000, which was completed in June 2020. Saila Potukuchi
with the City of Redondo Beach, stated that MMC, Inc. was the second low
bidder, but that the first low bidder withdrew. She also stated that the project
went well and that there were delays but most of the delays were caused by
Southern California Edison.
Per the Contract Documents, the District has a right to award the Contract to
other than the lowest bidder. In addition, the District reserves the right to reject
the bid of any bidder who does not pass the District's evaluation of the bidder's
ability and qualifications to complete the work to the satisfaction of the District.
Per the Contract Documents, Information for Bidders, Award of Contract section,
"The Owner reserves the right, in its sole discretion, to award the Contract to
other than the lowest Bidder pursuant to its discretionary authority under its
Purchasing Policy and the County Water District Law and in the interests of the
Owner."
Also per the Contract Documents, Information for Bidders, Competency of
Bidders section, "In selecting the lowest responsible Bidder, consideration will be
given not only to the financial standing but also to the general competency of the
Bidder for the performance of the Work covered by the Bid. By submitted a Bid,
each Bidder agrees that the Owner, in determining the successful Bidder and its
eligibility for the award may consider the Bidder's experience and facilities,
conduct and performance under other contracts, financial condition, reputation in
the industry, and other factors which could affect the Bidder's performance of the
Work." and "...the Owner reserves the right to reject the Bid of any Bidder who
does not pass any such evaluation to the satisfaction of the Owner."
Based on the bid review and reference check, the recommendation is that MMC,
Inc. is not a responsible bidder and that it would not be in the District's best
interests to award the project to MMC, Inc.
Page 63 of 82
MMC, INC. LIC. #573635
5901 Fresca Drive. La Palma, CA 90623
Phone: (714)521-2022. Fax: (714) 521-2440
April 8, 2022
Yorba Linda Water District
PO Box 309
Yorba Linda, CA 92885
Attn: Rosanne Weston, PE
Ammar Tohmeh, PE
Daniella Logsdon PE
Subject: Award Recommendation for Hidden Hills Booster Pump Station Project
MMC Inc. is in receipt of the memorandum dated 04/07/22 regarding the award recommendation for
the Hidden Hills Booster Pump Station project, wherein, the district recommends that MMC Inc. is not
a responsible bidder and it is not in the district's best interest to award the project to MMC Inc.
MMC Inc.'s response is as follows:
MMC adheres to the fact that we will self- perform the majority supporting work of the HVAC or
Roofing work. (MMC has provided the cost of roofing work from the vendor) The remaining work that
will be performed by a subcontractor will be less than 0.5% of the total bid.
In regards to the reference check for projects completed, there have definitely been delays caused,
however, MMC Inc. was not solely responsible for all the delays.
Please keep in mind, all the projects that have referenced in the memorandum, have either begun
before the covid pandemic and had been on-going during the pandemic. We are all aware of the
unforeseen conditions and situations caused by the global pandemic. There were covid delays to MMC
to manufacturers, to suppliers, to vendors, shortage of staff/personnel and to the public owners.
For the first project mentioned, with MWD, delays have been caused on both sides due to the covid
pandemic and submittal processes.
For the second project- well equipping and treatment plant improvements, the delay was by the design
and additional arsenic being found in the well water. This required new chemical treatment to complete
the project and it is still in the design phase.
The third project mentioned, with LACSD, the delay was again by the covid pandemic, by the owner
and with over $50K of extra work
As for the fourth and fifth project with city of Huntington Beach, once again delays due to covid
pandemic and additional change orders. Having talked to John, he has completely denied that the city
is going to prevent MMC from bidding for future projects (which you have stated in the memorandum)
Page 64 of 82
All the references are subjective. MMC cannot be held responsible for delays in each of these projects.
MMC has been a general contractor for over 30 years. None of the information the district has
presented demonstrates that MMC is not a "responsible" bidder nor that MMC lacks "competency" in
performing the work.
If the district has obtained references from Pacific Hydrotech (second lowest bidder) MMC Inc.
requests a copy to review those references.
Additionally, MMC requests the district to provide copies of their Purchasing Policy that give the
district "sole discretion" to award to other that the lowest bidder. If so, is this policy consistent with
Public Contract Code?
Lastly, MMC requests that this contract be awarded to us, it will demonstrate that this decision is fair
and impartial.
Awaiting your response
Regards,
Cal
l
J ga .
eh
Page 65 of 82
MMC, INC. LIC. #573635
5901 Fresca Drive, La Palma, CA 90623
Ph: (714) 521-2022; Fax: (714) 521-2440
April 15, 2022
Doug Davert: Assistant General Manager
Yorba Linda Water District
P.O. Box 3019, Yorba Linda, CA 92885
Subject: Award Recommendation of Hidden Bills Booster Pump Station Project Regarding MMC,
Memorandum dated 4/7/2022 and Email dated 4/13/2022
Dear Mr. Davert,
In your email of 4/13/22, you state that, "District is a County Water District under Water Code § 30, 000 et seq.
so it is not required to procure construction contracts using competitive bidding. " The issue, however, is not
that the District elected to utilize competitive bidding or did not elect to utilize competitive bidding. The issue is
that the District elected to utilize competitive bidding and chose not to award to the lowest responsive and
responsible bidder.
The Yorba Linda Water District Purchasing Policy (3010-007-POL), § 7.2 reads, in part, "Public Works
Contracts let by an Invitation to Bid shall be awarded to the lowest responsive, responsible bidder in
accordance with State law and the District's standard Public Works contract documents." Note that state law
always supersedes contract language and that illegal contracts are unenforceable. Regardless, it's not the case
that the District has "sole discretion" in the award as is stated in your email of 4/13/22. The District is bound to
California state law as is delineated in California's Public Contract Code and to secs. 10500 — 10506 of the
Public Contract Code in particular.
It is our position that MMC is "responsive" and is a "responsible bidder" per California Public Contract Code
and that the District's determination to the contrary is based on faulty and insufficient information without
merit. It is little more than hearsay. The district has not come close to demonstrating that MMC is not a
responsible bidder.
MMC clearly meets the requirements of being a responsible bidder:
1. State of California Contractor's License demonstrates minimum knowledge and experience to perform
the work.
2. Bonds verify financial capacity.
3. Insurance shows that an insurance company is willing to assume certain contractor risks.
4. MMC has successfully performed many projects of similar size and scope.
The District should not in anyway construe from any of MMC's communications to have waived "MMC's right
to a due process hearing to present rebuttal evidence or evidence of qualifications."
Please provide information as to how MMC can receive a due process hearing.
Thank you and please do not hesitate to contact me with any questions you may have.
Regards,
Ja eh a
F `—
Page 66 of 82
ITEM NO. 7.2.
Yorba Linda
Water District
/_1(r]=1►1I7_\V=1161AI
MEETING DATE: April 26, 2022
TO: Board of Directors
FROM: Doug Davert, Interim General Manager
STAFF CONTACTS: Rosanne P. Weston, Engineering Manager
Danielle Logsdon, Principal Engineer
Ammar Tohmeh, Senior Engineer
SUBJECT: Award of Construction Contract for the Hidden Hills Booster Pump
Station Improvements Project.
RECOMMENDATION:
Pending the results of the due process hearing in Item No. 7.1 of this Board meeting agenda,
staff recommends that the Board of Directors award the Construction Contract for the Hidden
Hills Booster Pump Station Improvements Project to Pacific Hydrotech Corporation for
$2,443,910.00, Job Nos. J-2020-20 and J-2018-27.
SUMMARY:
On January 7, 2022, the District solicited bids for improvements to the Hidden Hills Booster
Pump Station. These improvements include the replacement of an existing pump, a natural
gas backup generator, a new electrical room, a security fence and gate, a retaining wall, and
paving for improved site access. The booster pump station site is on Hidden Hills Road in the
City of Yorba Linda. On February 9, 2022, sealed bids were received from three contractors.
The three bids are shown in the summary below.
No. Contractor Total Bid Amount
1 MMC, Inc. $2,378,250.00
2 Pacific Hydrotech Corp. $2,443,910.00
3 Environmental Construction, Inc. $2,632,868.90
After reasonable inquiry and evaluation, staff does not recommend awarding the project to the
lowest bidder, MMC, Inc., because staff found MMC not to be a "responsible" bidder due to the
documented record of problems reported by other agencies. Therefore, it would not be in the
District's best interest to award the project to MMC, Inc. Staff recommends awarding the
Hidden Hills Booster Pump Station Improvements Project to the second lowest bidder, Pacific
Hydrotech Corporation, for $2,443,910.00.
19 6'�a_1>! 1►yi l :7_T91IF
Page 67 of 82
Budgeted: Yes
Total Construction Cost: $2,443,910
District's Construction Cost: $1,136,418
Developer's Construction Cost: $1,307,492
Funding Source: Capital and Developer Funded
Job Nos: J-2020-20 and J-2018-27
BACKGROUND:
This project was initiated due to the new Cielo Vista development, which will be constructed
within the City of Yorba Linda. The Developer funded portion will include the replacement of an
existing pump to meet anticipated demands and increase fire protection. The District funded
portion will include improvements to enhance site security, resiliency, and reliability per
America's Water Infrastructure Act of 2018 (AWIA), and to improve operations. The project will
also provide increased fire protection in the nearby wildfire -prone areas. This project was
identified in the District's 2018 Asset Management Plan.
PRIOR RELEVANT BOARD ACTION:
On June 22, 2021, the Board of Directors approved the Hidden Hills Booster Pump Station
Improvements Project as part of the FY21-22 Annual Budget Document.
STRATEGIC PLAN INITIATIVES:
G1 4A - Address infrastructure needs by updating/implementing the Asset Management Plan.
G3 2B - Address the District's future infrastructure needs.
Page 68 of 82
ITEM NO. 7.3.
Yorba Linda
Water District
/_[r]=1►1I7_\V=1161AI
MEETING DATE: April 26, 2022
TO: Board of Directors
FROM: Doug Davert, Interim General Manager
STAFF CONTACTS: Rosanne Weston, Engineering Manager
SUBJECT: Fourth Amendment to the Water and Sewer Facilities Agreement
Between the Yorba Linda Water District and North County, BRS,
LLC (now Lennar Homes of California LLC) for the Cielo Vista
Development Project
RECOMMENDATION:
That the Board of Directors approve the Fourth Amendment to the Cielo Vista Project Water
and Sewer Facilities Agreement dated August 1, 2018, conditioned on the Property Owners'
signatures to the Fourth Amendment within 30 days of this approval.
SUMMARY:
Submitted for the Board's consideration and approval is the Fourth Amendment to the Water
and Sewer Facilities Agreement ("Facilities Agreement") between the Yorba Linda Water
District and North County BRS, LLC (now Lennar Homes of California LLC) for the Cielo Vista
Development Project.
FISCAL IMPACT:
Developer Funded Project
Job No: J-2018-12
BACKGROUND:
The owner of the Cielo Vista property and development is Lennar Homes of California LLC.
The Existing Offsite Facility Improvements, which are discussed below, consist of: (a) an
extension of the water pipeline in Stonehaven; and (b) an upgrade and expansion of the
pumping capacity of the Hidden Hills Booster Pump Station ("Hidden Hills BPS").
The Facilities Agreement is amended a fourth time to:
1. authorize YLWD to construct the Existing Offsite Facility Improvements, and
Developer to fund its share of the cost to construct the Existing Offsite Facility
Page 69 of 82
Improvements prior to the Effective Date, which will not occur until summertime;
2. accurately reflect the parties' prior agreement for allocating costs to construct the
Hidden Hills BPS;
3. memorialize the allocation between the parties for Engineering Services Costs for
the Hidden Hills BPS as 46.5% to YLWD and 53.5% to Developer;
4. revise the cost estimate to construct the Hidden Hills BPS since receiving bids to
construct the Hidden Hills BPS;
5. revise the engineer's cost estimate, due to inflation, to extend the water pipeline
in Stonehaven;
6. allow Developer to make more than one lump sum payment for its share of costs
to construct the Existing Offsite Improvements, but the Developer is subject to
liquidated damages if it fails to pay the District such costs on certain deadlines;
and
7. update the project milestones and the project schedule due to the lapse of time
between the Third Amendment and the Fourth Amendment.
1UNIQ:AN=1I=1%1►kA-1107_1VI7_TOIIf] kiA
• On October 13, 2021, the Board of Directors approved the Third Amendment to
the Water and Facilities Agreement between the Yorba Linda Water District and
North County BRS, LLC for the Cielo Vista Development Project.
• On November 10, 2020, the Board of Directors approved the Second Amendment
to the Water and Facilities Agreement between the Yorba Linda Water District
and North County BRS, LLC for the Cielo Vista Development Project.
• On August 27, 2019, the Board of Directors approved the First Amendment to the
Water and Facilities Agreement between the Yorba Linda Water District and
North County BRS, LLC for the Cielo Vista Development Project.
• On May 22, 2018, the Board of Directors approved the Terms and Conditions for
Water and Sewer Service with North County BRS Project, LLC for Tract 17341.
• On July 24, 2018, the Board of Directors approved the Cielo Vista Project Water
and Sewer Facilities Agreement Between the Yorba Linda Water District and
North County BRS Project, LLC.
ATTACHMENTS:
Fourth Amendment to the Cielo Vista Project Water and Sewer Facilities Agreement
Page 70 of 82
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
For Recorder's tJse Only
FOURTH AMENDMENT TO
CIELO VISTA PROJECT WATER AND SEWER FACILITIES AGREEMENT
BETWEEN
YORBA LINDA WATER DISTRICT
AND
LENNAR HOMES OF CALIFORNIA, LLC
4857-6484-0475.3
372956.00020/4-15-22/jcc/bsb
Page 71 of 82
FOURTH AMENDMENT TO
CIELO VISTA PROJECT WATER AND SEWER FACILITIES AGREEMENT
BETWEEN
YORBA LINDA WATER DISTRICT
AND
LENNAR HOMES OF CALIFORNIA, LLC
This FOURTH AMENDMENT to the Cielo Vista Project Water and Sewer Facilities
Agreement ("Fourth Amendment") is made, entered into, and effective, on April 12, 2022
("Effective Date"), by and between the Parties.
RECITALS
A. The Parties previously entered into the Agreement titled Cielo Vista Project Water
and Sewer Facilities Agreement, which has an Agreement Date of August 1, 2018. The Parties
subsequently entered a (1) First Amendment, which has an effective date of August 27, 2019, (2)
Second Amendment, which has an effective date of August 1, 2020, and (3) Third Amendment,
which has an effective date of August 1, 2021. The reasons for those three Amendments are stated
in the Recitals of those Amendments.
B. Capitalized terms used in this Fourth Amendment, without being separately defined
herein, shall have the same meaning as defined in the Agreement and its Amendments.
C. Pursuant to Section 17 of the Agreement, all amendments to the Agreement must
be in writing and signed by the Parties.
D. The Parties previously agreed to apportion the construction cost to construct the
Hidden Hills Pump Station, which is one of the Existing Offsite Facility Improvements, for the
reasons stated in Exhibit L.2. Subsection (i) of section 5.C. of the Agreement is contrary to that
agreement so the Parties desire to amend subsection (i) of section 5.C. to accurately reflect that
agreement. The Parties agreed upon apportionment is reflected in the percent allocation stated in
Exhibit GA to this Fourth Amendment. The more detailed apportionment between the Parties in
Exhibit GA supersedes the table, only, in Exhibit L.2 that lists the "major project elements" and
assigns financial responsibility of each element to either Party.
E. Consistent with both Section 5.C.i as amended and the percent allocation between
the Parties in Exhibit GA, the Parties desire for (1) the costs for engineering services, construction
support services, construction management services, inspection services, and other related services
required only for the Hidden Hills Pump Station ("Engineering Services Costs") to be allocated
between the Parties with 46.5% allocated to YLWD and 53.5% allocated to Developer, and (2)
any Engineering Services Costs due to change orders to the Scope of Work to be allocated between
the Parties in accordance with Exhibit GA.
F. Due to the repeated extensions of the Effective Date term, YLWD elects to
construct the Existing Offsite Facility Improvements prior to the Effective Date and Developer
agrees, prior to the Effective Date, to fund its share of the cost of the Existing Offsite Facility
Improvements in two or three installments and one final payment.
4857-6484-0475.3
372956.00020/4-15-22/jcc/bsb
Page 72 of 82
G. The Parties desire to establish a procedure in which Developer will fund its
allocated amount of change orders to the Scope of Work for the Existing Offsite Facility
Improvements.
H. In January and February 2022, YLWD solicited and received bids to upgrade and
expand the pumping capacity of the Hidden Hills Pump Station. These bids, which have been
shared with Developer, provide a more accurate cost estimate, versus the engineer's cost estimate,
of the construction costs to upgrade and expand the pumping capacity of Hidden Hills Pump
Station. To (1) reflect this more accurate construction cost estimate and (2) account for anticipated
increased construction costs due to inflation to extend the water pipeline in Stonehaven, which is
the other Existing Offsite Facility Improvements, the Parties desire to replace Exhibit 11G.3" to
the Third Amendment.
L YLWD's budget to construct the Existing Offsite Facility Improvements is solely
dependent on Developer funding the Existing Offsite Facility Improvements. If Developer does
not pay YLWD the cost to construct the Existing Offsite Facility Improvements in a timely manner,
then YLWD will not have the budgeted funds to construct the Existing Offsite Facility
Improvements, which may cause, among other things, construction to stop on the Existing Offsite
Facility Improvements, YLWD to defer other capital improvement projects, or YLWD to go out
to the bond market to finance the Existing Offsite Facility Improvements. The cost to YLWD of
such actions is extremely difficult to ascertain. Accordingly, Developer will pay YLWD $1,000
per day if Developer fails to deposit the second, third (if any) and final payments by the deadlines
noted below, not as a penalty but as liquidated damages for breach of Agreement as amended for
each and every day that Developer is in breach. The amount of liquidated damages has been fixed
and agreed upon by and between the Parties because of the impracticability and extreme difficulty
of fixing and ascertaining the actual damages YLWD would sustain during such a breach; and said
amount is agreed to be the amount of monetary damages sustained by YLWD.
J. For the avoidance of doubt, the Parties wish to make clear that the following acts
of YLWD and the Developer constitute each Party's satisfaction of the condition in Exhibit K 4
that the Hidden Hills Pump Station is "under construction": (i) YLWD's issuance of a Notice to
Proceed for construction of the Hidden Hills Pump Station and (ii) Developer's deposit of the first
installment of the Developer's share to construct the Existing Offsite Facility Improvements.
K. Due to the lapse of time between the Third Amendment and this Fourth
Amendment, Developer requested and YLWD agreed to update the Project milestones in
Exhibit "J.3" to the Second Amendment and the Project schedule in Exhibit 11K.3" to the Third
Amendment. Exhibit K.3 is also updated to delete (i) Psomas' obligation to complete the final
design plans and specifications for the Stonehaven water main project, and (ii) Developer's
obligation to update to the bid documents to reflect YLWD's update to the standard specifications
for the Stonehaven project since both (i) and (ii) have been accomplished to the satisfaction of the
Parties.
AGREEMENT
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which is
hereby acknowledged and accepted, the Parties agree as follows:
4857-6484-0475.3
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Page 73 of 82
The Agreement is amended as follows:
A. Subsection (i) of section S.C. in the Agreement is hereby deleted and replaced in
its entirety as follows:
Exhibit GA, which may be amended from time to time, is a
preliminary estimate and the final costs may change up or down after
construction completion of the Existing Offsite Facility
Improvements. Developer shall pay to YLWD 100% of the costs to
construct the Existing Offsite Facility Improvements, except for the
construction cost allocated to YLWD to construct the Hidden Hills
Pump Station as provided in Exhibit GA as amended from time to
time. Using funds paid to YLWD from Developer for its allocated
share, along with YLWD's own funds for its allocated share, YLWD
shall pay to all third parties, who will design and construct the
Existing Offsite Facility Improvements, the costs of designing and
constructing the Existing Offsite Facility Improvements, except for
costs incurred by Developer for third -party consultants such as
Psomas to design and construct the Existing Offsite Facility
Improvements.
2. The Second Amendment is amended as follows:
A. Section 3 in the Second Amendment is hereby deleted and replaced in its entirety
by Section 3 below in this Fourth Amendment:
The Third Amendment is amended as follows:
A. To (i) reflect the construction cost to construct the Hidden Hills Pump Station as
allocated between the Parties, (ii) reflect the more accurate construction cost estimate to upgrade
and expand the pumping capacity of Hidden Hills Pump Station, and (iii) account for anticipated
increased construction costs due to inflation to extend the water pipeline in Stonehaven,
Exhibit 11G.3" to the Third Amendment is hereby deleted and replaced in its entirety by
Exhibit 11G.4" to this Fourth Amendment.
B. Pursuant to Section 5.B.iii of the Agreement and to reflect a change in the Project
milestones, Exhibit "J.3" to the Third Amendment is replaced by Exhibit "J.4" to this Fourth
Amendment.
C. Pursuant to Section 5.B.iii of the Agreement and to reflect a change in the Project
schedule, Exhibit "K.3" to the Third Amendment is replaced by Exhibit "K.4" to this Fourth
Amendment.
D. The table, only, in Exhibit L.2, which lists the "major project elements" and assigns
financial responsibility of each element to either Party, is hereby deleted and superseded by
Exhibit G.4.
4857-6484-0475.3
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Page 74 of 82
4. Within 5 days of YLWD's delivery of a fully executed Fourth Amendment, Developer
shall deposit, in the Existing Offsite Facility Improvements Escrow as provided in Section 5.0 of
the Agreement, half of Developer's allocated amount of the costs to construct the Existing Offsite
Facility Improvements provided in Exhibit G.4 of this Fourth Amendment and the other half within
four months of YLWD's Notice to Proceed for construction of the Hidden Hills Pump Station. The
final costs, not covered by Developer's two payments of Developer's allocations to construct the
Existing Offsite Facility Improvements, shall be paid to YLWD within 30 days of written notice
to Developer that the second of two Notices of Completion for the two Existing Offsite Facility
Improvements has been submitted for recording with the County Recorder's Office. If the awarded
bid amount for the Stonehaven pipeline is more than 10% higher than the engineer's estimate to
construct the Stonehaven pipeline, which is provided in Exhibit G.4, then Developer shall deposit
an additional installment to the Existing Offsite Facility Improvements Escrow for the entire
monetary difference between the engineer's estimate and the awarded bid amount. Developer
shall deposit this additional installment to YLWD within 30 days written notice, which shall
include a written invoice of the amount owed, to Developer of the bid award to construct the
Stonehaven pipeline
A. Developer's failure to deposit either (i) all two or three installments; or (ii)
Developer's allocation of the final costs by the deadlines in Section 4 above is a breach of the
Agreement as amended, which will cause YLWD to assess Developer, and Developer shall pay,
liquidated damages in the amount of $1,000 per day, which shall be triggered upon Developer's
failure to pay either deposit described in (i) or (ii) of this Section 4.A. to YLWD within 30 days of
receipt of the written notice specified above, and YLWD's providing a written invoice of the
amount owed. Because of the extreme difficulty to ascertain damages to YLWD, as described in
the Recitals above, if Developer does not pay to YLWD either deposit described in (i) or (ii) of
this Section 4.A by the deadlines in Section 4, Developer shall pay to YLWD the above daily
amount, not as a penalty but as liquidated damages for breach of the Agreement as amended.
YLWD may deduct the amount of such liquidated damages from the Existing Offsite Facility
Improvements Escrow or collect it directly from Developer.
5. All Engineering Services Costs not due to change orders to the Scope of Work for the
Hidden Hills Pump Station shall be allocated between the Parties with 46.5% allocated to YLWD
and 53.5% allocated to Developer. Any Engineering Services Costs due to change orders to the
Scope of Work for the Hidden Hills Pump Station shall be allocated between the Parties in
accordance with Exhibit G.4, as may be amended from time to time. And any such Engineering
Services Costs due to change orders that are allocated to Developer shall be deposited by
Developer into the Existing Offsite Facility Improvements Escrow within 30 days written notice,
which shall include a written invoice of the amount owed, of YLWD's change order approval.
6. The following acts of YLWD and Developer constitute each Party's satisfaction of the
condition in Exhibit K.4 that the Hidden Hills Pump Station is "under construction": (i) YLWD's
issuance of a Notice to Proceed for construction of the Hidden Hills Pump Station and (ii)
Developer's deposit of the first installment of the Developer's share to construct the Existing
Offsite Facility Improvements.
7. This Fourth Amendment shall be recorded with the Orange County Recorder's Office.
4857-6484-0475.3
372956.00020/4-15-22/jcc/bsb -4-
Page 75 of 82
8. The Agreement and its Amendments shall remain in full force and effect in accordance
with its terms and provisions except as amended by this Fourth Amendment. The Parties hereby
confirm and ratify each of the provisions of the Agreement and its Amendments as amended by
this Fourth Amendment.
9. This Fourth Amendment may be executed in one or more counterparts, all counterparts
shall be valid and binding on the Party executing them and all counterparts shall together constitute
one and the same document for all purposes.
IN WITNESS WHEREOF, the Parties have executed this Fourth Amendment on the
Effective Date above. The Parties have caused this Fourth Amendment to be executed on their
behalf and the signatories represent that they have been duly authorized to enter into this Fourth
Amendment on behalf of their respective Parties.
Yorba Linda Water District,
a public agency
("YLWD")
By:
Doug Davert, Interim General Manager
APPROVED AS TO FORM:
Kidman Gagen Law, LLP
Bv:
Andrew B. Gagen, General Counsel
REVIEWED BY:
YLWD
By:
Rosanne P. Weston, Engineering Manager
4857-6484-0475.3
372956.00020/4-15-22/jcc/bsb
Lennar Homes of California, LLC
("Developer")
By: \
Title: �!/ % Ltr ?, rw t % r ->+C -j IK—
APPROVED AS TO FORM:
0
-5-
Attorneys for Developer
Page 76 of 82
8. The Agreement and its Amendments shall remain in full force and effect in accordance
with its terms and provisions except as amended by this Fourth Amendment. The Parties hereby
confirm and ratify each of the provisions of the Agreement and its Amendments as amended by
this Fourth Amendment.
g. This Fourth Amendment may be executed in one or more counterparts, all counterparts
shalt be valid and binding on the Parry executing them and al counterparts shall together constitute
one and the same document for all purposes.
IN WITNESS WHEREOF, the Parties have executed this Fourth Amendment on the
Effective Date above. The Parties have caused this Fourth Amendment to be executed on their
behalf and the signatories represent that they have been duly authorized to enter into this Fourth
Amendment on behalf of their respective Parties.
Yorba Linda Water District,
a public agency
("YLWD")
By:
Lennar Homes of California, LLC
("Developer")
M.
Doug Davert, Interim General Manager Title:
APPROVED AS TO FORM:
Kidman Gagen Law, LLP
By:
Andrew B. Gagen, General Counsel
REVIEWED BY:
YLWD
By:
Rosanne P. Weston, Engineering Manager
4837-6484.0475.3
372956.0002014.15-22ijccAnb
APPROVEED AS TO FORM: L
L� +� I'LL _1.1 S JCL ri+aw�l lc- lv^� $ N St 5 LLQ
By:�J _
J,Fkl% Attorneys for Developer
Page 77 of 82
ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the individual
who signed the document to which this certificate is
attached, and not the truthfulness, accuracy, or
validity of that document.
State of California
County of Orange
On April 19, 2022 before me, Peggy R. Yazloff, Notary Public
(insert name and title of the officer)
personally appeared Brian Bencz
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
' ..:. PEGGY R. YAZLOFF
WITNESS my hand and official seal. COMM. #2323881
o; ; '
o Notary Public • California
Z Orange County
My Comm. E ires Mar. 124 2024
Signature (Seal)
Page 78 of 82
EXHIBIT "G.4"
EXISTING OFFSITE FACILITIES FEE SUMMARY
AND
ALLOCATION OF COSTS FOR EXISTING OFFSITE
FACILITY IMPROVEMENTS
Existing Offsite Facilities Fee Summary
Description Length (LF) Cost per LF ($)
Existing Water Allocation Fees..........................................................................................
$
290,217
Existing Sewer Allocation Fees.......................................................................................
$
109,242
Water& Sewer Total......................................................................................................
$
399,459
AnnexationFees' .......... ................................... ...................................... I ...... I..............
$
15,644
TotalAll Fees...............................................................................................................
$
415,103
Fee per Dwelling Unit (74 DUs).......................................................................................
$
5,609.50
AMIFacilities'............................................................................................................ $ 40,000
Developer Share of Existing Offsite
Facility Improvements
Description Length (LF) Cost per LF ($)
Cost ($)
12" Stonehaven Drive Watermain2 1300
758,800
Hidden Hills Pump Station Upgrades"
1,289,885
Subtotal.....................................................................................................................
2,048,6851
YLWD Share of Existing Offsite
Facility Improvements
Description Length (LF) Cost per LF ($) Cost ($)
12" Stonehaven Drive Watermain 1300 0.00
Hidden Hills Pump Station Upgrades5 1,121,115
Subtotal..................................................................................................................... 1,121,115
Footnotes:
1) Annexation Fees per October 24, 2017 memorandum from Brett R. Barbre to John Lewis.
2) 12" watermain in Stonehaven Drive from just east of Davonport Circle to Project entrance just east of Via de la Roca Drive. The
cost is based on an enginee's estimate, only, as of the Effective Date of the 4 1 Amendment, and said cost may be revised in
accordance with Section 5.C.(i) as amended by the 4`h Amendment.
3) Fee for AMI Facilities previously paid per original Agreement and not included in Fee per Dwelling Unit.
4) Based on 53.5 percent allocation of $2,411,000 estimated amount, including 10 percent contingency.
5) Based on 46.5 percent allocation of $2,411,000 estimated amount, including 10 percent contingency.
Page 79 of 82
EXHIBIT "G.4"
EXISTING OFFSITE FACILITIES FEE SUMMARY
AND EXISTING OFFSITE FACILITY IMPROVEMENTS (CONT.)
HIDDEN HILLS BOOSTER PUMP STATION
Item
Description
City.
Unit
District Allocation
Developer Allocation
1
.c mobilization. .and Permits
1
LS
46.50%
53.50%
2
cementation, Disinfection, and Erosion Control/Compliance with SWPPP Requirements
1
LS
46.50%
53.50%
3
Nor. Itrol Measures
1
LS
46.50%
53.50%
4
Verification of Utility Locations. Field Dimensions, and Existing Electrical Work
1
LS
46.50%
53.50%
5
Startup and Testing
1
LS
46.50%
53.50%
6
Record Documents, O&M Manuals and Warranties
1
LS
46.50%
53.50%
7
Spare Parts
1
LS
46.50%
53.50%
8
Training
1
LS
46.50%
53.50%
9
Structural, Mechanical and Electrical Demolition
1
LS
0.00%
100.00%
10
Clearing and Grubbing, Site Demolition, and Soil Preparation
1
LS
46.50%
53.50%
11
Cutting of Existing System Water Mains and Removal and Disposal of Existing Piping where Shown
1
LS
0.00%
100.00%
12
Rehabilitation of Existing Concrete Masonry Unit BPS Building for New Electrical Room
1
LS
0.00%
100.00%
13
Construction Work for BPS Roof
1.0
LS
0.00%
100.00%
14
Miscellaneous Steel and Aluminum Construction Work
1
LS
0.00%
100.00%
15
HVAC Work
1
LS
46.50%
53.50%
16
Yard Conduit and Wiring and Electrical and Lighting Work
1
LS
46.50%
53.50%
17
VFD Motor Control Center
1
LS
0.00%
100.00%
18
Automatic Transfer Switch
1
LS
100.00%
0.00%
19
Instrumentation, Telemetry, and Control System
1
LS
46.50%
53.50%
20
SCE Transformer Replacement
1
LS
0.00%
100.00%
21
350 kW Natural Gas Generator
1
LS
100.00%
0.00%
22
Site Paving, Concrete Curb & Gutter, and Flatwork
1
LS
100.00%
0.00%
23
Perimeter Fencing and Motorized Swing Gate
1
LS
100.00%
0.00%
24
Masonry Retaining Walls
1
LS
100.00%
0.00%
25
Connect to Existing Piping
1
LS
46.50%
53.50%
26
Yard Piping and Fittings
1
LS
46.50%
53.50%
27
Valves
1
LS
0.00%
100.00%
28
Installation of pre -purchased Magnetic Flow Meter (see Appendix E) and appurtenances
1
LS
100.00%
0.00%
29
Vertical Turbine Water Pump and Motor (Pump #4)
1
LS
0.00%
100.00%
30
Chlorine Analyzer
1
LS
100.00 %
0.00
31
Unknown Underground Obstruction
1
LS
46.50%
53.50%
32
Additional Cast
1
LS
46.50%
53.50%
33
Contingency
10.00%
46.50%
53.50%
Al
Flow Meter Vault
1
LS
100.00%
0.00%
A2
Allowance for Reimbursement for Permit Fees
1
LS
46.50%
53.50%
A3
Allowance for Reimbursement for YLWD Power Service and Transformer
1
LS
0.00%1
100.00%
c0 STONEHAVEN DRIVE WATERMAIN
(D DEVELOPER ALLOCATION - 100%
CD
O DISTRICT ALLOCATION - 0%
O
Co
N
EXHIBIT "J.4"
CIELO VISTA OFF-SITE WATER IMPROVEMENTS SCHEDULE*
�otiti o�ti
c� �J�
P� E 1 week ��
O`�ope, �JatJ
�a
Stonehaven Pipeline
I
I
Advertise & Award
District Award (6/14/2022)
I
I
District Issue NTP
Submittals
1
I
I
Mobilization
Pipe Construction
Paving
I
I
YLWD Approved & Operational
Hidden Hills Pump Station
I
I
District Award (4/27/2022)
District Issue NTP
Submittals
1
I
Mobilization
1
Construction
I
Punch List & Testing
YLWD Approved & Operational
1
LEGEND
Grading Started
March 2022
YLWD
CONTRACTOR
Production Homes Start
Est. May 2023
I �
Model Homes Start
Est. January 2023
*This construction schedule reflects the current dates for Board meetings, which may change, and the schedule is contingent on Board approval
and the contractor's completion schedule.
v
c0
m
w
0
w
N
4/12/2022
EXHIBIT "K.4"
Schedule for YLWD to Provide Access to Water
Project Rough Grading: YLWD shall provide temporary access to water for the Property
through an existing hydrant for Developer to commence Project rough grading, following the
Effective Date and YLWD's receipt of Developer's deposit Pursuant to Section 5.C. of the
Agreement as amended. Developer shall apply for a temporary construction meter, procure
a reduced pressure backflow device to attach to the temporary construction meter, comply
with all YLWD testing and reporting procedures, and pay all applicable fees, including water
usage fees.
2. Drop Lumber and Residential Framing for Model Homes: Before any lumber drop for Project
framing and construction of the model homes, the Stonehaven water main (listed in Exhibit
11G.4" and illustrated on Exhibit "H.1") and the Subdivision Facilities up to the hydrant(s)
serving the model homes shall be constructed, complete and operational, tested and
approved. The Parties shall use all commercially reasonable efforts as necessary to complete
the Stonehaven water main in time to provide access to construction water for lumber drop
and residential framing of the model homes in accordance with the schedule in Exhibit "J.4".
Based on typical construction practices and since it can be ready to go to bid when necessary
and assuming YLWD (not Developer) constructs the Stonehaven water main, the Stonehaven
water main can be constructed in the same timeframe as the onsite water facilities for the
Project and all efforts will be made to coordinate the construction schedule of the Stonehaven
water main with the Project onsite water facilities. Developer must notify YLWD in a timely
manner to provide YLWD sufficient time to complete the Stonehaven water main project
according to schedule.
3. Drop Lumber, Residential Framing and Construction of Remainder of Project Homes: The
Developer may construct the Project's residential homes in phases. Before any lumber drop
for framing and construction of the residential homes in each Project phase, the segment of
the Subdivision Facilities serving such phase of residential homes shall be constructed,
complete and operational, tested and approved, and the Hidden Hills Pump Station
improvements (listed in Exhibit "G.4" and illustrated on Exhibit "I") shall be under
construction. The Parties shall use all commercially reasonable efforts as necessary to
commence construction prior to lumber drop and residential framing of the first phase of
Project homes in accordance with the schedule in Exhibit "J.4". In addition to the scheduling
contingencies in Section 5.B.iii in the original Agreement, this schedule is also contingent
upon Psomas completing the Hidden Hills Pump Station final design plans and specifications
and receiving YLWD acceptance in accordance with the schedule in Exhibit "J.41'.
Assuming YLWD (not Developer) constructs the Hidden Hills Booster Pump Station,
Developer must notify YLWD in a timely manner to provide YLWD sufficient time to
complete the Hidden Hills Booster Pump Station project according to schedule.
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