Terms and Conditions for the Construction, Operations, and Maintenance of the WRCRWA Recycled Water Pump Station and On-site Reservoir December 27, 2023
General:
A Memorandum of Understanding (MOU) was entered into on July 12, 2023, among the City of Corona (Corona), City of Norco (Norco), Jurupa Community Services District (JCSD), Home Gardens Sanitary District (Home Gardens), Western Municipal Water District (Western Water) and the Western Riverside County Regional Wastewater Authority (WRCRWA), collectively referred to as the Parties, to support the implementation of a recycled water program through WRCRWA. The MOU identified the intent of the Parties to implement recycled water infrastructure projects, as more fully described herein, identified proposed capacity ownership rights by agency, assigned lead agency responsibilities, and defined and allocated estimated construction costs.
The purpose of this interagency agreement (Agreement) is to formalize the construction, operations, and maintenance requirements for the proposed Recycled Water Pump Station (Pump Station), as well as the operations and maintenance responsibilities for the existing 1.0 Million Gallon (MG) on-site recycled water storage reservoir (On-site Reservoir). This Agreement also addresses administrative and financial responsibilities and capacity allocations in these facilities.
The proposed Pump Station will pump recycled water produced at the WRCRWA Treatment Plant from the On-site Reservoir for delivery through three recycled water delivery pipelines on behalf of the WRCRWA member agencies for designated beneficial uses. The three recycled water pipelines, which are described in Definition A, connect to and are served by the Pump Station. The recycled water pipelines are not a part of this agreement.
Definitions:
A. Recycled Water Project (Recycled Project): Defined as the overall recycled water infrastructure required to deliver WRCRWA recycled water to points of connection for conveying the recycled water to the Parties’ designated beneficial uses. This recycled water infrastructure includes a proposed 10.15 million gallon per day (MGD) Pump Station and associated metering and discharge piping to be built on the WRCRWA Treatment Plant property located at 14634 River Road, Corona, CA, the existing 1.0 million gallon treated recycled water reservoir located on the WRCRWA Treatment Plant property that will provide equalization storage during pumping (On-site Reservoir), a 24-inch diameter recycled water transmission pipeline (Northerly Pipeline), a 20-inch diameter recycled water transmission pipeline (Southerly Pipeline), and an existing 12-inch diameter recycled water pipeline owned by Norco (Norco Pipeline). The Pump Station is a combined station that will consist of two banks of pumps; one to supply the Northerly Pipeline and one to supply the Southerly Pipeline and the existing Norco Pipeline, and one standby pump that will serve as a back-up for both banks of pumps.
B. Points of Connection: Defined as the physical locations where the Northerly Pipeline, the Southerly Pipeline, and the Norco Pipeline will be interconnected to the Pump Station’s discharge piping. The points of connection shall be the basis for the delineation of ownership and agency responsibilities for these infrastructure components of the Recycled Project. The Points of Connection are depicted on Exhibits A-1 and A-2, attached hereto. The coordinates of Points of Connection are as follows:
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
Facility Northing Easting
Northerly Pipeline 2283399.011 6150769.920
Southerly Pipeline 2283419.744 6150882.666
Norco Pipeline 2283367.415 6150820.257
C. Project Development Costs: Includes costs associated with planning, preliminary design (including survey and geotechnical), program management, and environmental documentation.
D. Project Implementation Costs: Includes costs associated with final design, geotechnical, permits, surveying, right-of-way acquisition, facility agreement and legal services, encroachment permits, community outreach, and program management,
E. Capital Costs: Includes costs incurred in connection with new capital facility construction, capacity expansion, or facility betterments. For the Recycled Project, capital costs include, but are not limited to, construction costs for the above and below-grade improvements, piping, appurtenances, metering, valves, pumps, motors, utility service connections and metering, instrumentation and control, SCADA, site improvements and structures along with all construction related costs and services including bonding, legal services, engineering services during construction, construction geotechnical services, construction surveying, construction/program management, inspection, traffic control, and environmental monitoring and mitigation.
F. Replacement and Refurbishment Costs (R&R Costs): Includes costs incurred to replace major capital items and facilities and refurbish infrastructure to maintain operation or extend useful service life.
G. Fixed Operating Costs: Includes on-going operating costs that do not vary with the quantity of recycled water delivered from the Recycled Project, including, but not limited to, routine maintenance, fixed utility expenses, and administrative overhead costs such as insurance, budgeting, budget tracking, invoicing, and related general management expenses.
H. Variable Operating Costs: Includes on-going operating costs that vary based on the quantity of recycled water delivered from the Recycled Project. These costs include but are not limited to energy and chemical usage, and the repair and replacement of perishable capital items and equipment including but not limited to items such as gaskets, valve seats, electrical switches and similar items that routinely wear during the use of a facility. Variable costs will be aggregated and allocated to the Parties based upon the proportion of recycled water delivered on behalf of each Party as described in Section 4.a. of this Agreement.
I. Physical Infrastructure Ownership: Legal ownership and physical custody of the various infrastructure components of the Recycled Project, with associated responsibilities. Physical infrastructure ownership of the Pump Station and the On-site Reservoir is specified in Section 2.c of this Agreement.
J. Capacity Ownership: Each Party’s ownership percentage of capacity in the various infrastructure components of the Recycled Project. The total capacity of each component of the infrastructure shall be equal to the sum of the Party’s individual capacity ownership interests. Capacity ownership of the Pump Station and the On-site Reservoir is specified in Section 2.e of this Agreement.
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
K. Operations and Maintenance Lead Party: The Parties to this Agreement designated are responsible for the on-going operations and maintenance for each of the various infrastructure components of the Recycled Project. In cases where the operations and maintenance lead Party must access another Party’s property to operate and maintain a component of the Recycled Project infrastructure, the Parties will cooperate to provide access rights for required operations and maintenance activities. For purposes of this Agreement, WRCRWA is designated as the lead Party for the operations and maintenance of the Pump Station.
L. Design and Construction Lead Party: In cases for which new recycled water infrastructure is required to be designed and constructed for the Recycled Project, the design and construction lead Party shall procure and manage design and construction services as required. The design and construction lead Party shall be reimbursed for such services, including Capital Costs, Project Development costs, and Project Implementation Costs as described in this Agreement, or any future amendments agreed to by the Parties.
In cases where the design and construction lead Party is not the Party with ultimate physical infrastructure ownership and the infrastructure is located on another Party’s property, the Parties will cooperate to provide access rights for construction activities. For purposes of this Agreement, JCSD is designated as the lead Party for the design and construction of the Pump Station. JCSD will require and be granted access rights from WRCRWA for construction of the Pump Station, metering facilities and discharge piping to the Points of Connection with the Northerly Pipeline, the Southerly Pipeline, and the Norco Pipeline.
M. Recycled Water Cost Center: A specific section in WRCRWA’s annual operating and capital budget that categorizes and tracks all costs associated with Pump Station, the On-site Reservoir, and applicable portions of WRCRWA Treatment Plant or other facilities that are specifically applicable to the Recycled Project.
Terms and Conditions:
1. Term and Termination:
a. Term: The term of this Agreement shall commence on _____/_____/2024 (Effective Date) and, unless earlier terminated, shall terminate concurrently with the WRCRWA Joint Exercise of Powers Agreement and addenda thereto.
b. Termination: A Party may terminate its participation in this Agreement by selling its capacity rights in total to another Party or Parties under the procedures set forth in Section 5.c. All of the Parties to this Agreement may terminate the Agreement by unanimous written consent.
2. Recycled Water Infrastructure
a. Recycled Project Infrastructure Description: The Pump Station shall be constructed and located at the WRCRWA Treatment Plant site and shall be a combined station that will consist of two banks of pumps; one to supply the Northerly Pipeline and one to supply the Southerly Pipeline and the existing Norco Pipeline, and one standby pump that will serve as a backup to both banks of pumps. The On-site Reservoir shall serve as the primary forebay for the Pump Station. The configuration of the Recycled Water facilities and the Points of Connection of the pipelines referenced herein are shown on Exhibits A-1 and A-2, attached hereto.
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
b. Recycled Water Storage: Equalization storage is required to support the operation of the Pump Station and to meet the Parties’ recycled water demands. Such storage shall initially be provided by the existing On-site Reservoir located at the WRCRWA Treatment Plant site that is currently serving as the recycled water treated water reservoir. In the event that further storage is required for system-wide operations, the Parties to this agreement wishing to acquire additional recycled water storage capacity shall coordinate through WRCRWA to design and construct one or more new storage reservoirs on the WRCRWA Treatment Plant site, or at an off-site location agreed to by the Parties. Expansion of the recycled water storage shall be under separate agreement among the Parties wishing to acquire storage in the expanded facilities.
c. Pump Station and On-site Reservoir Infrastructure Owner: WRCRWA shall be the physical infrastructure owner of the Pump Station upon completion of construction as specified in Section
3.c.iv. of this Agreement. WRCRWA currently owns the existing On-site Reservoir that will be utilized for equalization storage and will also own any future recycled water on-site operational storage connected to the Pump Station.
d. Pump Station and On-site Reservoir Operations and Maintenance: WRCRWA is designated as the operations and maintenance lead Party and shall be responsible for operations and maintenance of the Pump Station and On-site Reservoir in a manner consistent with the WRCRWA Treatment Plant facilities and in accordance with Section 5.
e. Pump Station Design and Construction: JCSD is designated as the design and construction lead Party for the Pump Station. The Parties agree that the Pump Station shall be designed and constructed in a manner generally consistent with the report commissioned by JCSD entitled: “Recycled Water Pipeline and Pump Station Preliminary Design Report,” prepared by Albert A. Webb and Associates, dated April 2022 (PDR), and in accordance with the design and operational standards of the WRCRWA Treatment Plant. JCSD shall coordinate with the Parties on final design, pre-bid and construction of the Pump Station and obtain required approvals from the Parties as described in Section 2.g. f. Future Recycled Water Storage Design and Construction: WRCRWA is designated as the design and construction lead Party for potential expansion of recycled water equalization storage at the WRCRWA Treatment Plant as needed to augment the existing On-site Reservoir. For potential storage expansion in off-site locations, the design and construction lead Party shall be determined by the Parties participating in the expansion at such time when expansion is deemed necessary by the Parties. The Parties will determine the need for and timing of such expansion and shall consider operational monitoring conducted by WRCRWA in accordance with Section 5.b in making that determination. g. Project Coordination and Approvals: JCSD shall coordinate with WRCRWA and the Parties throughout the final design, pre-bid, and construction award phases of the Pump Station project to ensure the facility is in accordance with WRCRWA design and operational standards and any grant funding material specification requirements, such as “Buy American” provisions. JCSD shall schedule and convene quarterly coordination meetings of the Parties to discuss construction related items, provide project construction and schedule updates, and to consider approval of Capital Costs as described below.
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
In the initial quarterly coordination meeting, which shall occur no later than forty-five (45) days prior to the scheduled JCSD Board action to award the Pump Station construction contract, the representatives of the Parties shall have obtained from their individual governing boards or councils, as needed, the authority to approve in the meeting the following:
i. Initial Capital Costs for the Pump Station and appurtenant facilities plus a ten percent (10%) Capital Cost contingency.
In subsequent quarterly coordination meetings throughout the duration of the project, the representatives of the Parties shall have obtained from their individual governing boards or councils, as needed, the authority to approve in the meetings the following additional Capital Costs:
ii. Issuance of any construction change orders cumulatively exceeding ten percent (10%) of the original Pump Station construction contract amount.
iii. Issuance of professional service contracts amendments cumulatively exceeding ten percent (10%) of each original contract amount.
Items placed on the agenda of the quarterly coordination meetings by JCSD that require approval of the Parties will be provided to the Parties no less than forty-five (45) days in advance of the quarterly meeting date. Approval of the initial Capital Costs as described in Section 2.g.i,shallrequire unanimous consent of the Parties. Approval of additional Capital Costs as described in Section 2.g.ii, and Section
2.g.iii, shall require the majority consent of the Parties. JCSD may schedule coordination meetings of the Parties more frequently than quarterly, if needed.
h. Capacity Ownership of Project: The Pump Station shall be designed to deliver approximately 10.15 million gallons per day (MGD). Capacity ownership of the Pump Station shall be allocated upon daily flows in MGD.
Initial capacity ownership in the Recycled Water Pump Station shall be allocated in accordance with Table 1, below.
Table 1 – Recycled Water Pump Station Capacity Ownership Agency Capacity (MGD) Percentage (%)
Corona 2.62 25.81%
Home Gardens 0.56 5.52%
Norco 1.70 16.75%
Western MWD 1.54 15.17%
JCSD 3.73 36.75%
Total 10.15 100.00%
Capacity ownership in the existing recycled water On-site Reservoir equalization storage shall be allocated based upon capacity ownership of each in the WRCRWA Treatment Plant, as listed in Table 2, below.
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
Table 2 – WRCRWA Treatment Plant and On-site Reservoir Capacity Ownership Agency
WRCRWA Treatment
Plant Capacity (MGD)
On-site Reservoir
Capacity (MG) Percentage (%)
Corona 2.62 0.187 18.71%
Home Gardens 0.75 0.054 5.36%
Norco 2.70 0.193 19.29%
Western Water 1.93 0.138 13.78%
JCSD 6.00 0.428 42.86%
Total 14.00 1.000 100.00%
The sum of the individual capacity ownership percentages equates to approximately the nominal operating capacity of the Pump Station. No change in the percentage of capacity ownership by a Party shall occur by reason of any variance between actual and the nominal capacity of the Pump Station, except by amendment of this Agreement.
3. Capital Costs and Funding
a. Recycled Water Pump Station Costs: The MOU between the Parties included an estimated Capital Cost for the Pump Station of $17.90 million. This cost estimate was based upon information derived from the PDR and the most recent design and construction cost estimates at that time, escalated to the projected mid-point of construction, and included a 20% contingency plus proportionate Project Development Costs and Project Implementation Costs . As of October 9, 2023, the estimated costs for the Pump Station including Project Development Costs, Project Implementation Costs, and Capital Costs plus a 15% Capital Cost Contingency was $19.84 million. As the Pump Station project proceeds, project approvals and cost reconciliation shall be performed pursuant to Section 2.g and Section 3.c. b. Grant Funding: JCSD has been successful in securing grant funding to offset costs for the construction of a recycled water distribution system for its service area, which includes the Pump Station. JCSD shall provide $3.2 million in grant proceeds to offset the Parties’ costs for the Pump Station in proportion to each Party’s capacity ownership as shown in Table 1. Application of the grant proceeds shall be administered by JCSD and shall be applied when JCSD receives funding from the granting agencies.
c. Funding for Project Development and Project Implementation Costs and Completion of Project: Upon the Effective Date of this agreement, each Party shall be obligated to make a series of payments based upon project milestones for their share of project costs based upon their percentage capacity ownership in the Pump Station shown in Table 1. Deposits shall be made in accordance with the following milestones and shall be due and payable to JCSD on the schedule indicated. Thirty (30) days prior to each milestone payment due date, JCSD shall perform a cost reconciliation based on actual costs incurred to-date and shall submit an itemized invoice to each Party for Payment. Project milestones and payment requirements are as follows:
i. Milestone No. 1 – Completion of Project Development Activities, Project Implementation Activities, and Final Design
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
1. Payment includes all Project Development and Project Implementation activities including final design.
2. Due date: sixty (60) days after JCSD Board action to award the Pump Station construction contract.
ii. Milestone No. 2 – Construction Progress Payments
1. Includes all Capital Costs associated with construction and construction change orders, bonding, and construction support legal services, engineering services during construction, construction geotechnical services, construction surveying, construction/program management, inspection, and environmental monitoring and mitigation.
2. Due date: Quarterly payments, due at end of each calendar year quarter after issuance of the Notice to Proceed (First quarter - due March 31, second quarter - due June 30), third quarter - due September 30, and fourth quarter – due December 31).
iii. Milestone No. 3 – Final Cost Reconciliation
1. Includes those Capital Costs associated with final construction change orders, not previously included as part of prior construction progress payments included on Milestone No. 2, and all remaining construction support costs and final costs through start-up, commissioning, and issuance of a Notice of Completion by JCSD.
2. Due Date: Thirty (30) days after JCSD’s issuance of a Notice of Completion. iv. Milestone No. 4 – Project Completion and Asset Transfer
1. Includes transfer of all Pump Station assets, construction warranty rights and operating responsibilities from JCSD to WRCRWA.
2. Due Date: No later than sixty (60) days after JCSD’s issuance of a Notice of Completion, which will be deemed the completion of the Pump Station project.
4. Operating and Capital Cost Allocations
a. Pump Station Operating Costs: As defined in this Agreement, operating costs include both Fixed Operating Costs and Variable Operating Costs. The allocation of Fixed Operating costs for the Pump Station among the parties shall be based upon each Party’s capacity ownership in the Pump Station as expressed in Table 1. Variable Operating Costs for the Pump Station shall be allocated among the Parties based upon metered deliveries of recycled water to the Parties for their designated uses.
Designated uses include direct deliveries to each of the Parties through the Northerly Pipeline, Southerly Pipeline or the Norco Pipeline, or deliveries through one or more of these facilities for outside sales or external exchanges.
b. On-site Reservoir Operating Costs: The allocation of Fixed Operating costs for the On-site Reservoir among the parties shall be based upon each Party’s capacity ownership in the WRCRWA Treatment Plant. Variable Operating Costs for the On-site Reservoir shall be allocated among the Parties based upon metered deliveries of recycled water to the Parties for their designated uses. Designated uses include direct deliveries to the Parties through the Northerly Pipeline, Southerly Pipeline or the Norco pipeline, or deliveries through one or more of these facilities for outside sales or external exchanges.
Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
c. Capital and Replacement and Refurbishment Costs: Capital and replacement and refurbishment (R&R) costs shall be based upon each Party’s capacity ownership in Pump Station and the On-site Reservoir at the time of the proposed capital project or R&R project. Establishment of an R&R fund and contributions to the fund shall be included in the annual budgeting process described in Section 5.d.
5. Administration
a. Governance: Upon the transfer of the Pump Station to WRCRWA and commencement of operations, as described in Section 3.c.iv. (Milestone No. 4), all Recycled Project budget, capital improvement, replacement and refurbishment, and applicable operating policy decisions shall be made by members of the WRCRWA Board of Directors representing Parties with capacity ownership in the Recycled Project. All voting shall be in accordance with the requirements of the WRCRWA Joint Exercise of Powers Agreement, applicable addenda, and adopted WRCRWA policies and procedures. b. Operations: Upon the transfer of the Pump Station to WRCRWA and commencement of operations as described in Section 3.c.iv. (Milestone No. 4), WRCRWA shall assume physical control of the facilities and be responsible for all operations and maintenance decisions and regulatory compliance, consistent with the WRCRWA Joint Exercise of Powers Agreement, applicable addenda, and adopted policies and ordinances. WRCRWA will also have all operating responsibilities for the On-site Reservoir, and in cooperation with the Parties, will monitor intra-day peaking and will optimize the scheduling of recycled water deliveries and maximize the utilization of the existing On-site Reservoir using the Parties’ aggregate capacity. WRCRWA will also monitor capacity utilization and will report and make timely recommendations to the Parties and the WRCRWA Board regarding the need for additional projects to expand recycled water storage after the Parties’ aggregate capacity has been fully utilized. c. Capacity Ownership Adjustments and Transfers: If a Party determines that it wishes to adjust its capacity ownership in the Pump Station, or the On-site Reservoir, or both facilities, the Party may buy, sell, or enter a leasing arrangement with another Party or Parties to make such adjustments. Such a transaction may only occur among WRCRWA member agencies. In addition, Parties may wish to selectively participate in future capital projects to expand the capacity of the Pump Station, or the Onsite Reservoir, or both facilities. In such cases where an ownership transfer changes capacity ownership, the allocation of Capital Costs, R&R Costs and Fixed Operating Costs will be adjusted accordingly. Should a Party or Parties sell all their capacity in the Pump Station, the On-site Reservoir, or both facilities to another WRCRWA Party or Parties, the Party or Parties selling all their capacity ownership in the applicable infrastructure shall have no further financial obligations under this Agreement. All transactions that result in a change in capacity in the facilities shall be promptly reported to WRCRWA in writing for accounting, budgeting, and cost allocation purposes, and the Parties agree to amend this Agreement to reflect such changes in capacity ownership interests as soon as practical following such changes.
d. Budget Administration: One hundred eighty (180) days prior to the Recycled Project becoming operational, WRCRWA shall prepare a draft annual operating, capital and R&R budget for the Pump Station and On-site Reservoir portion of the Recycled Project. The proposed draft annual operating budget shall include a Recycled Water Cost Center for categorizing and tracking all costs associated with Pump Station, the On-site Reservoir, and other portions of WRCRWA Treatment Plant operations Recycled Water Project Construction, Operations and Maintenance Agreement December 27, 2023
that are specifically applicable to the Recycled Project. The Recycled Cost Center draft budget shall include all costs for operations and maintenance, capital expansions, and R&R funding, and shall be organized in a manner that aligns with WRCRWA’s existing accounting, financial reporting, and budgeting practices and policies applicable to the WRCRWA Treatment Plant. In conjunction with WRCRWA’s preparation of the initial draft operating, capital, and R&R budget for the Pump Station, WRCRWA shall coordinate with JCSD and its design engineer to cause the preparation of an initial R&R plan for the Pump Station that WRCRWA can use as guidance for annual budgeting purposes. i. WRCRWA shall incorporate its Recycled Cost Center draft budget information into its annual Operating Budget and Capital Improvement Program Budget to specifically identify recycled water system costs and associated assets for which WRCRWA is responsible. Approval of the annual Operating Budget and Capital Improvement Program Budget shall be in accordance with the WRCRWA Joint Exercise of Powers Agreement, applicable addenda, and adopted WRCRWA policies and procedures. ii. Each Party shall be financially responsible for its portion Fixed Operating Costs, Variable Operating Costs, Capital Costs and R&R Costs for the Pump Station and On-site Reservoir in accordance with Section 4 of this Agreement and in accordance with the provisions of WRCRWA’s Joint Exercise of Powers Agreement. iii. Each Party shall be invoiced by WRCRWA for the Recycled Project costs, not paid under Section 3.c, above, in the same manner, timing, and terms as WRCRWA’s normal invoicing for costs related to the WRCRWA Treatment Plant and collection system.
6. Miscellaneous
[Add legal provisions – governing law, integration (sole agreement and supersedes prior discussions), dispute resolution, etc.]