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HomeMy WebLinkAboutMin 09-14-05 (UVSD) CITY OF UKIAH CITY COUNCIL AGENDA SPECIAL MEETING MINUTES OF September 14, 2005 1. ROLL CALL - Convened at 5:06:37 PM Present: Councilmembers Crane, McCowen, Rodin, and Mayor Ashiku Absent: Councilmember Baldwin Staff present: City Manager Horsley, Finance Director McCann, City Attorney Rapport, Public Works Director Ziemianek, and City Clerk Ulvila. Ukiah Valley Sanitation District Board of Directors Present: Board members Crane and Chairman Pro-tem Wattenburger. Absent: Chairman Delbar by prearrangement. Also present: Chief Deputy County Counsel Zotter, Clerk of the Board/District Secretary Furman, member of County Executive Office-Shaw, member of the Clerk of the Board's Office-Moore. 2. JOINT MEETING WITH THE CITY COUNCIL AND UKIAH VALLEY SANITATION DISTRICT (UVSD): Presentation and Discussion by Bartle Wells Associates Regarding the Sewer Rates and Bond Issues for the Wastewater Treatment Plant Rehabilitation and Capacity Addition Project 5:07:21 PM Finance Director McCann explained that the Wastewater Treatment Plant is currently being planned for a rehabilitation and capacity addition to meet Federal, State, and County requirements and the City has contracted with the firm of Bartle Wells Associates for finance planning, rate reviews, and ultimately bond sales services to provide long-term financing for the project. Doug Dove, employed with the firm of Bartle Wells Associates, provided a PowerPoint presentation regarding the proposed sewer rates of 2005/06 through 2009/10 and methods utilized in preparing the analysis, including use of reserves to mitigate impacts to ratepayers. He noted the rate increases will be phased-in over a five-year period of time. City Attorney Rapport conveyed to the City Council the procedure, as stipulated by Proposition 218, with regard to public noticing requirements and described the "optimal" condition of having the rate structure secure prior to entering into a contractual relationship with the selected bidder to assure funding for the project. Discussion ensued concerning the following matters: · Utilizing reserves · Rate smoothing strategies · Formula for projections for single-family consumption · Public hearing noticing requirements · The possibility of adjusting/lowering the rates in future years · The possibility of having a cost overrun on the project is a concern along with an adequate contingency fund established and built into the rate structure so it would be available if needed Mr. Dove responded that Bartle Wells has built in a sufficient amount of contingencies into the cost of the project. 1 Public Utilities Director Ziemianek confirmed the "parallel paths" of the two agenda items before the Council/UVSD for consideration, noting the recent turn of events in the southem states due to hurricane damage and the associated materials and supplies demand. He urged the Council/UVSD to consider award of bid, as the Iow bidder has agreed to hold the original contract estimate until November 2, 2005. JOINT MEETING WITH THE CITY COUNCIL AND UKIAH VALLEY SANITATION DISTRICT (UVSD): Discussion and Possible Award of Bid Contracts to Kiewit Pacific Company and Ewing Construction Services Related to the Rehabilitation and Capacity Addition of the Wastewater Treatment Plant Facility ("Improvement Project") 5:34:52 PM It was the consensus of the Councilmembers present to hear from the firm of Kiewit Pacific Company prior to making a decision on the matter. Brad Kaufman, Area Manager with Kiewit Pacific Company, described the changing environment since the last review of the contract bid on July 14, 2005, as related to Hurricane Katrina's destruction of the Gulf Coast. He referenced a handout containing potential delay costs related to the hurricane, local cost issues, recent treatment plant and heavy mechanical bids (Iow bid v. engineers estimate), and letters from equipment and materials suppliers, in which they agreed to extend their bid prices 60 days. He continued with a discussion of increased fuel prices, insurance costs, costs of equipment and materials, and the general instability currently in the market. He noted that value engineering savings could also contribute to the "contingency", noting Mr. Ewing's early indication of significant cost savings measures which could be considered. Considerable discussion ensued with regard to the Agenda Summary Report and: · The cost of the project · The possibility of increased construction costs, including materials and equipment if the project were delayed · Whether a delay would be the most cost effective approach · Various risks in delaying the project It was the consensus of the Councilmembers present to accept the rate structure as provided/modified by Bartle Wells, and directing staff to transmit the required 45-day Proposition 218 notices. It was the consensus of the UVSD members present to accept the rate structure as provided/modified by Bartle Wells, and directing staff to transmit the required 45-day Proposition 218 notices. Mr. Kaufman, in response to Councilmember McCowen, stated that Kiewit would honor their bid, contractually. He noted they expect increased fuel costs and additional expenses, however, they should be able to make a profit on the project because there are some escalations and contingencies built into their bid and they stand by their price. He went on to discuss the Kiewit contract and expressed an interest in composing a contract addendum to incorporate legal conditions/assurances for the City as part of the approved contract to allow cancellation of the contract should the public hearing process be unfavorable and a clause could be included in the contract that the contract could be terminated at the convenience of the City Council. He also stated that Kiewit could provide the City with a letter confirming that the City could award the contract for the fUll amount and Kiewit's team would attempt to fit in the costs. If that couldn't be achieved, Kiewit would not protest the Council's decision to terminate the contract, with the exception of the work they have completed thus far. City Attorney Rapport stated that the proposed contract addendum would not be legal and that the contract could not be altered prior to the bid either being awarded or rejected. Public Utilities Director Ziemianek stated that as prices increase, it is imperative that the City conduct discussion with Kiewit until the bid is accepted. He expressed his concern with the number of items that are long-term lead items, such as the trickling filters, and his concern with subcontractors. DaVid Jack, estimator on the project for Kiewit, discussed his conversations with subcontractors and noted that they are obligated to wait until November 2, 2005 and they have committed to the 60 day extension. Board member Wattenburger stated that considering the magnitude of this project, all members of the UVSD and City Council should be present to make the decision concerning this project. He expressed the need to educate the public with regard to the need for improvements to the wastewater treatment plant and associated rate increase. 7:11 PM - Recessed 7:25:58 PM- Reconvened Discussion continued with regard to various aspects of the project. Mayor Ashiku polled the Council and received a consensus to agendize a Joint Meeting for October 5, 2005 and encouraged all Councilmembers and UVSD members to attend. It was a general consensus of the UVSD members to support the proposal for a continued meeting on October 5, 2005, with a presentation by Mr. Ewing, ECS Consulting, and consideration of bid award. M/RC McCowen/Rodin approving the consultant contract with Ewing Construction Services in the amount of $38,366.25 and authorizing the City Manager to execute the individual agreements, with addition that staff have flexibility with implementation of contract terms; and carried by the following roll call vote: AYES: Councilmembers Crane, McCowen, Rodin, and Mayor Ashiku. NOES: None. ABSTAIN: None. ABSENT: Councilmember Baldwin. M/RC Crane/Wattenburger approving the consultant contract with Ewing Construction Services in the amount of $38,366.25 and authorizing the City Manager to execute the individual agreements, with addition that staff have flexibility with implementation of contract terms; and carried by the following roll call vote: AYES: Councilmembers Crane, McCowen, Rodin, and Mayor Ashiku. NOES: None. ABSTAIN: None. ABSENT: Councilmember Baldwin. 7:42:35 PM By a consensus of the City Council, the Joint Meeting of the City Council and Ukiah Valley Sanitation District (UVSD) was adjourned. M/S Crane/Wattenburger to adjourn the UVSD joint meeting with the City Council, carried by a voice vote. 7:42:50 PM Recessed 7:51:10 PM Reconvened 4. ELECTRIC WORKSHOP:7:5]:]0 ?Ni Public Utilities Director Ziemianek provided a PowerPoint presentation of the City of Ukiah's Electric Utility, including the various financial and technical aspects of running the City's largest utility operation. He focused on the City's progress in developing improved system reliability, protocols, maintenance, and discussed possible new initiatives, and discussed various items contained in the presentation with the City Council. 8:28:00 ?NI Discussion ensued concerning the information presented. Director Ziemianek also discussed Northern California Power Authority (NCPA) dealing with the generation deficit situation and noted that it is undergoing an analysis to find an effective way to proceed and build new plants. He explained that staff will be assessing the photovoltaic program and would like to work with approved contractors regarding installation of the system. He discussed the rate stabilization fund and the City's levels of reserves. In conclusion, Council commended the Public Utilities Director and his staff for the great strides made in that department. 5. ADJOURNMENTS:50:39 PM There being no further business, the meeting was adjourned at 8:50 p.m. Marie Ulvila, City Clerk