Table of Contents
7-7-2026 Regular Meeting Agenda
Item 1 - Minutes
Item 2 - 7.7.26 List of Demands Packet
Item 4 - Regional Wastewater Disposal Agreement (SARA)
Item 5 - EP25-049 Approval Resolution
Item 6 - First Amendment Schmidt Design Group Agreement Item 7 - Ardurra Task Order Amendment
Item 8 - 21st Pump Station Repairs
Item 9 - Required Actions to Secure NOAA Funding
Item 10 - Fire Department Position Reclassification
Item 11 - Fire Station Alert System
Item 12 - Undergrounding Program Advisory Committee Appointment Item 13 - EP26-056 (1411 Via Alta)
Item 14 - CDM Bridge ROW Approvals and Project Update
Item 15 - CIP PEIR Info Item
Item 16 - UP Update
Item 17 - Streetlight Policy for UP
Item XIE and XIIBC - Council Liaison Report - Martinez
2 10
16 39
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340
347
350
352
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407
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425
Del Mar City Council Meeting Agenda
City of Del Mar, Town Hall
1050 Camino del Mar, Del Mar, California 92014
And via teleconference
1317 Irving Avenue, Colonial Beach, Virginia 22443
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us Civility Works: The Del Mar Code of Civil Discourse: Together we will promote inclusion; listen to understand; show respect; be clear and fair; and focus on the issue.
Regular Meeting
Tuesday, July 7, 2026 at 4:30 PM
Public Participation: Members of the public may participate in City Council meetings in person, remotely, or by submitting written comments (“Red Dots”). Public comments are generally limited to three minutes per speaker, at the Mayor’s discretion. Comments on items not on the agenda may be made during Public Oral
Communications. Agenda items may be taken out of order at the Mayor’s discretion. Electronic presentations must be submitted before 12:00 p.m. on the day of the meeting; presentations cannot be loaded during the meeting.
In-Person Participation: Please submit a completed speaker slip, including the agenda item number, to the City Clerk before the item is announced. Speaker slips are available near the entrance of Town Hall. When called to speak, please approach the podium and state your name for the record.
Remote Participation: Join the Zoom Webinar using the link or dial-in information below: Zoom Link:
https://tinyurl.com/zoomdelmar; Phone: (669) 900-6833;
Meeting ID: 879 0650 1544.
To indicate you wish to speak use the “Raise Hand” feature or dial *9 by phone when the agenda item is announced, or at the start of the meeting for non-agenda public comment. Upon joining the meeting, all attendees will automatically be muted with video feed disabled. When called to speak, please unmute yourself using the “Unmute” button or by pressing *6 on your phone, and state your name and affiliation (if applicable). Remote speakers are responsible for verifying their audio and video equipment is operational prior to the meeting.
Written Comments: Written Comments (“Red Dots”) for items on the agenda should be emailed to [email protected] by 12:00 p.m. on the day of the meeting. The email subject line should clearly identify the agenda item being addressed.
Viewing the Meeting and Access to Agenda Materials: Members of the public can watch the meeting live on the City’s website at: http://delmar.12milesout.com/Video/Live and on Cable TV Spectrum Ch. 24, AT&T Ch. 99 starting at 4:30 PM. Agenda materials and “Red Dots” are available on the City’s website: http://www.delmar.ca.us/AgendaCenter.
Assistance for Persons with Disabilities: In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the Administrative Services Department at 1050 Camino del Mar or by calling (858) 755-9313.
Notification of at least 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting.
Tracy Martinez
Mayor
John W. Spelich
Deputy Mayor
Terry Gaasterland
Council Member
Dan Quirk
Council Member
Ashley Jones
City Manager
Christina Cameron
City Attorney
Sarah Krietor
Administrative Services
Manager/City Clerk
Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 2
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us I. CALL TO ORDER/ROLL CALL
II. CITY ATTORNEY CLOSED SESSION REPORT
III. PLEDGE OF ALLEGIANCE
IV. PUBLIC ORAL COMMUNICATIONS
Each person wishing to speak in-person before the City Council on any matter not on the agenda shall submit a “Speaker Slip” to the City Clerk when Public Oral Communication is announced. Each person wishing to speak remotely before the City Council on any matter not on the agenda shall raise their hand by using the “Raise Hand” feature or dialing *9 on their phone when Public Oral Communication is announced. When the speaker’s name is called, the speaker should unmute and state, in an audible tone of voice, their name and affiliation (if applicable).
Each speaker will have up to three (3) minutes to speak at the discretion of the Mayor and may be asked clarifying questions. Information received during Public Oral Communication may be received, placed on a future agenda, or referred to the City Manager by the City Council. State law generally precludes the City Council from discussing or acting upon any topic presented during oral communications that is not described on the posted agenda.
Note: there is a time limit of 30 minutes for this section of public communications and each speaker will be heard in the order of the submission of their speaker slip. Speakers who have turned in a speaker slip prior to the time oral communications was called on the agenda, but were not heard during the initial time period shall be called to speak at the end of the agenda.
V. COMMUNITY ANNOUNCEMENTS
VI. CITY MANAGER’S REPORT
VII. CONSENT CALENDAR
All items listed on the Consent Calendar are considered to be routine and will be acted upon with one motion. There will be no separate discussion of these items unless a member of the City Council or the public so requests, in which event, the item will be pulled from the Consent Calendar and considered separately after the motion to approve the Consent Calendar. If you wish to remove an item from the Consent Calendar, please submit a “Speaker Slip” to the City Clerk.
1. Approval of Minutes: June 16, 2026 Regular and Special Meeting Recommended Action: Approve Minutes.
Reference: Clerk’s Minutes Book
Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 3
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us
2. Ratification of List of Demands dated July 7, 2026
Recommended Action: Ratify the List of Demands.
Reference: Clerk’s File No. 201-3
3. Waiver of Reading of Ordinances on Agenda
Recommended Action: Waive Reading of Ordinances.
Reference: Clerk’s File No. 401-4
4. Second Amended and Restated Regional Wastewater Disposal Agreement between the City of San Diego and the Participating Agencies in the Metropolitan Sewerage System
Recommended Action: Staff recommends that the City Council adopt a Resolution (Attachment A) approving the Second Amended and Restated Regional Wastewater Disposal Agreement (SARA), as revised.
Reference: Clerk’s File No. 406-1
5. Approval of Encroachment Permit 25-049 – Request to Install Grasscrete Hardscape Material and Other Public Improvements within the Public Rightof-Way at 1612 Stratford Way; Applicant: Paul Rael Recommended Action: Staff recommends that the City Council adopt a Resolution (Attachment A) memorializing prior Council action to approve a Longterm Major Encroachment Permit (EP) 25-049 to install the following encroachments within the public right-of-way at 1612 Stratford Way:
Replace decomposed granite (“DG”) with grasscrete hardscape material; Install a mountable concrete curb between the roadway and the grasscrete material;
Install a six-inch concrete curb adjacent to the property fence line; Relocate walkway pavers
Reference: Clerk’s File No. 802-1
6. First Amendment to Agreement with Schmidt Design Group for Shores Park Master Plan
Recommended Action: Staff recommends the City Council: 1) Approve the First Amendment to the Agreement with Schmidt Design Group for preparation of the Shores Park Master Plan to adjust the scope of services and compensation, and add a ten percent (10%) project contingency of $17,731 (Attachment A); and 2) Authorize the City Manager to execute the First Amendment and any additional agreement changes within the project contingency.
Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 4
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us Reference: Clerk’s File No. 307-8, 406-1
7. Task Order Amendment with Ardurra and Project Contingency Increase for the Jimmy Durante Boulevard Bluff Stabilization Project Recommended Action: Staff recommends that the City Council: 1) Approve a $38,100 Task Order Amendment (Attachment A) with Ardurra for extended construction management and inspection services; 2) Approve a five-percent (5%) increase ($38,610) to the project contingency; 3) Authorize the City Manager to execute the Task Order Amendment and any subsequent amendments or contract Change Orders within the updated project contingency necessary to complete the work; and 4) Authorize the carryover of unspent FY 2025-2026 project budget to FY 2026-2027.
Reference: Clerk’s File No. 406-1
8. Approval of Pump Repairs at the 21st Street Wastewater Pump Station Recommended Action: Staff recommends that the City Council: 1) Approve $90,000 in pump repairs at the 21st Street Wastewater Pump Station; and 2) Authorize the City Manager to direct San Elijo Joint Powers Authority (SEJPA) to proceed with the pump repairs.
Reference: Clerk’s File No. 406-1
9. Required Actions to Secure Federal Funding for the San Dieguito Lagoon Shoreline Protection Project
Recommended Action: Staff recommends the City Council: 1) Authorize staff to submit the necessary application and take any additional administrative actions as may be necessary to receive $1,031,000 in federal funds that were appropriated in the FY 2026 Federal Budget specifically for the City’s San Dieguito Lagoon Shoreline Protection Project (Project) from the National Oceanic and Atmospheric Administration (NOAA); and 2) Authorize the City Manager to sign the necessary documents.
Reference: Clerk’s File No. 803-3
10. Fire Department Position Reclassification
Recommended Action: Staff recommends that the City Council adopt a Resolution (Attachment A) reclassifying a Battalion Chief position to a Management Analyst series position in the Fire Department and authorizing filling the position up to the Associate Management Analyst level.
Reference: Clerk’s File No. 1101-8
Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 5
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us
11. Authorization to Purchase Fire Station Alerting System Recommended Action: Staff recommends that the City Council: 1) Approve an Agreement (Attachment A) with US Digital Design by Honeywell International, Inc. for the purchase and installation of a new Fire Station Alerting System in the total amount not to exceed $80,805; and 2) Authorize the City Manager to execute the Agreement and other necessary purchasing documents.
Reference: Clerk’s File No. 1101-8
12. Appointment to the Undergrounding Program Advisory Committee Recommended Action: The City Council Liaisons to the Undergrounding Program Advisory Committee (UPAC) recommend that the City Council appoint Michel Maronde to UPAC as voting member to serve the balance of a vacant term starting July 7, 2026, and ending on June 30, 2027.
Reference: Clerk’s File No. 401-5
VIII. PUBLIC HEARING
13. Encroachment Permit 26-056 to Allow a New Vehicle Access Gate and Vegetation Within a Utility Easement Located at 1411 Via Alta Applicant: KFH Properties, LLC
APN: 300-040-57-00
Recommended Action: Staff recommends the City Council adopt the attached Resolution (Attachment A) conditionally approving Long-term Major Encroachment Permit (EP) 26-056 to allow a new vehicle access gate and vegetation within a utility easement located at 1411 Via Alta.
Reference: Clerk’s File No. 802-1
IX. COUNCIL MEETING RECESS
X. CITY COUNCIL OTHER BUSINESS
14. Camino Del Mar Bridge Replacement Right of Way Approvals and Project Update
Recommended Action: Staff recommends that the City Council: 1) Receive an informational update on the Camino Del Mar Bridge Replacement Project; and 2) Adopt a Resolution (Attachment A) authorizing the City Manager to sign the Rightof-Way Certifications required for federal funding for the Camino Del Mar Bridge Project.
Reference: Clerk’s File No. 803-3
Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 6
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us
15. Informational Summary of Draft Program Environmental Impact Report for the City’s Capital Improvement Program
Recommended Action: Staff recommends the City Council receive this informational report summarizing the findings of the Draft Program Environmental Impact Report (Draft PEIR) prepared by the City’s consultant, Michael Baker International (MBI), for the City’s Capital Improvement Program (CIP), with the City serving as lead agency in compliance with the California Environmental Quality Act (CEQA).
Reference: Clerk’s File No. 803-1
16. Undergrounding Program Updates
Recommended Action: Staff recommends the City Council receive an update on the Undergrounding Program.
Reference: Clerk’s File No. 1001-2
17. Streetlight Policy Considerations for Citywide Undergrounding Program Recommended Action: Staff recommends that the City Council adopt a Resolution (Attachment A) formalizing a City Council Policy (Exhibit A to Attachment A) related to the handling of streetlights mounted on SDG&E utility poles that will be removed as part of the City’s Undergrounding Program.
Reference: Clerk’s File No. 1001-2
XI. REGIONAL ORGANIZATION REPORTS
A Councilmember assigned as a liaison to a regional organization may make a written or oral report. State law precludes the Council from commenting on, discussing, or acting on a report unless the item of business within the report is described in the agenda.
A. Clean Energy Alliance JPA (CEA) Board of Directors (Spelich/Gaasterland) B. CSA-17 Ambulance District Advisory Board (Martinez)
C. Fire Governance Board, Solana Beach/Del Mar/Encinitas (Martinez/Spelich) D. League of California Cities – San Diego Chapter (Martinez/Spelich) E. North County Transit District (NCTD) (Martinez/Spelich) Recommended Action: Receive Report
F. Regional Solid Waste Association (Spelich/Quirk)
G. San Diego Association of Governments Board (SANDAG)
(Gaasterland/Martinez/Spelich)
H. SANDAG Borders Committee (Gaasterland)
I. SANDAG Regional Planning Committee (Martinez)
J. SANDAG Shoreline Preservation Working Group
(Gaasterland/Spelich/Martinez)
K. SANDAG LOSSAN Executive Task Force (Gaasterland/Martinez) L. San Diego Metropolitan Wastewater Commission/JPA (Worden) Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 7
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us M. San Dieguito River Valley Regional Open Space Park JPA –Executive Committee (Gaasterland/Martinez)
N. Other Regional Organization Reports
XII. COUNCIL COMMITTEES/SUBCOMMITTEES/COMMUNITY ORG REPORTS A Councilmember assigned as a liaison to a City Committee, Council Subcommittee OR Community Organization may make a written or oral report. State law precludes the Council from commenting on, discussing, or acting on a report, unless the item of business within the report is described in this agenda.
A. Civic Center Operations Guide Subcommittee (Spelich/Gaasterland) B. Del Mar Community Connections (Martinez/Spelich)
Recommended Action: Receive Report
C. Del Mar Village Association (Gaasterland/Martinez)
Recommended Action: Receive Report
D. Finance Committee (Spelich)
E. Housing Subcommittee (Gaasterland/Martinez)
F. Human Resources Subcommittee (Gaasterland/Martinez)
G. Legislative Subcommittee (Martinez/Spelich)
H. Measure Q Citizen Oversight Committee (Quirk/Gaasterland) I. Parks and Recreation Committee (Martinez/Quirk)
J. Del Mar Railroad Subcommittee (Gaasterland/Martinez) K. Lagoon Committee (Spelich)
L. Planning Process Subcommittee (Includes Sea-Level Rise Adaptation Plan Implementation (Gaasterland/Spelich)
M. Shores Park Master Plan Ad-Hoc Advisory Committee (Gaasterland/Spelich) N. Sustainability Advisory Committee (Martinez/Gaasterland) O. Traffic and Parking Advisory Committee (Quirk/Spelich) P. Undergrounding Program Advisory Committee (Spelich)
Q. Other Committee-Subcommittee Reports
XIII. UPCOMING AGENDA ITEMS
The following topics/items are tentatively planned for upcoming agendas. The title, wording, and planned date for these items are subject to change. Final agendas are posted at City Hall 72 hours in advance of the meetings and are also posted on our web site with the accompanying staff report. Please watch our web site:
www.delmar.ca.us for City Council Agendas.
August 25, 2026
Task Order with Michael Baker International for Design of FY27 Pavement Improvements Project
DMCB Interim Use Agreement with Del Mar Foundation
Acceptance of Coastal Access Easement at 101 11th Street Acceptance of Public Sewer Easement Dedication at 101 11th Street Conflict of Interest Code Bi-annual Update
Del Mar City Council Regular Meeting July 7, 2026
Agenda Page 8
1050 Camino del Mar, Del Mar, CA 92014 www.delmar.ca.us State Mandated Annual Fire Inspection Report
De Novo V25-002
Lot Line Adjustment Regulations Ordinance - Introduction of Ordinance XIV. CERTIFICATION
I, Sarah Krietor, Administrative Services Manager/City Clerk for the City of Del Mar, hereby certify that a copy of this agenda was posted at City Hall on the 2nd day of July, 2026 at approximately 5:10 p.m.
___________________________________________ 7/2/2026
Sarah Krietor, Administrative Services Manager/ Date
City Clerk
DEL MAR CITY COUNCIL
SPECIAL MEETING MINUTES
CLOSED SESSION
JUNE 16, 2026
City of Del Mar Town Hall
1050 Camino del Mar, Del Mar, California 92014
CALL TO ORDER
Mayor Tracy Martinez called the meeting to order at 3:15 p.m.
ROLL CALL
Present: Mayor Tracy Martinez; Deputy Mayor John Spelich; Councilmember Terry Gaasterland
Absent: Councilmember Dan Quirk
CLOSED SESSION
A) Conference with Legal Counsel – Existing Litigation
Abitbol v. Del Mar
San Diego Superior Court Case No. 26CU006372C
Authority Government Code section 54956.9(d)(1)
Reportable Action: None.
B) Conference with Legal Counsel - Significant Exposure to Litigation Number of Cases: One
Description: 6th Cycle Housing Element Implementation
Authority: Government Code Section 54956.9(d)(2)
Reportable Action: None.
C) Conference with Legal Counsel – Existing Litigation
Lazier v. City of Del Mar
San Diego Superior Court Case No. 25CU058363C
Authority: Government Code Section 54956.9(d)(1)
Reportable Action: None.
ADJOURNMENT
Mayor Martinez adjourned the meeting at 4:25 p.m.
_______________________________________
Kseniia Izgarskaia, Senior Management Analyst
1 July 7, 2026 Item 1
CITY OF DEL MAR
CITY COUNCIL REGULAR MEETING MINUTES
JUNE 16, 2026
City of Del Mar Town Hall
1050 Camino del Mar, Del Mar California 92014
The minutes set forth the actions taken by the City Council on the matters stated. Audio/video recordings of the City Council proceedings are retained for a period of ten years, in accordance with the City's Records Retention Schedule. Audio/video recordings, as well as written materials presented to the City Council, including Red Dots (materials provided to the City Council after the agenda has published), are available on the City’s website at www.delmar.ca.us/AgendaCenter or by contacting the Administrative Services Department at (858) 755-9313.
CALL TO ORDER
Mayor Tracy Martinez called the Regular Meeting to order at 4:33 p.m.
ROLL CALL
Present: Mayor Tracy Martinez; Deputy Mayor John Spelich; Councilmembers Terry Gaasterland and Dan Quirk (arrived at approximately 5:16 pm).
CITY ATTORNEY CLOSED SESSION REPORT
City Attorney Christina Cameron reported that were no reportable actions for the June 16, 2026, Closed Session.
PLEDGE OF ALLEGIANCE
Mayor Martinez led the Pledge of Allegiance.
PUBLIC ORAL COMMUNICATIONS
Mayor Martinez opened public oral communications and Shirli Weiss spoke with donations of time from Amy Cheshire and Camilla Rang. Mayor Martinez closed public oral communications.
CITY COUNCIL COMMUNITY ANNOUNCEMENTS
The Mayor thanked Senator Blakespear for hosting a webinar on E-Bike safety on June 10, 2026, and urged members of the public to watch the webinar recording available on Senator Blakespear’s website.
CITY MANAGER’S REPORT
City Manager Ashley Jones reported on traffic delays due to County Fair activities through July 5, 2026, except Mondays and Tuesdays, and provided a reminder that illegal planting of trees or vegetation in the City’s right of way is prohibited.
PRESENTATIONS
ITEM 1: PROCLAMATION FOR SHAWNA ANDERSON (SAN DIEGUITO RIVER PARK JOINT POWERS AUTHORITY CEO) (CLERK’S FILE NO. 1201-5)
A proclamation was presented to San Dieguito Park JPA CEO Shawna Anderson by Mayor Martinez.
Shawna Anderson received the proclamation and provided comments. The Council congratulated Shawna Anderson on her retirement and expressed appreciation for her contributions to the Del Mar community and the San Dieguito River Park.
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Mayor Martinez opened the item to public comment and the following people spoke:
1) Diana Kutlow, representing Senator Blakespear’s office 2) Dwight Worden
3) Betty Wheeler
Mayor Martinez closed the item to public comment.
ITEM 2: PROCLAMATION FOR PATRICK GIANNETTO (RETIRED DEL MAR FIRE CAPTAIN) (CLERK’S FILE NO. 1201-5)
A proclamation honoring former Del Mar Fire Captain Patrick Giannetto was presented to Patrick Giannetto’s sister Kathleen Perrotta by Mayor Martinez. Kathleen Perrotta received the proclamation and provided comments.
There were no public speakers for this item.
City Manager Jones provided comments and expressed her condolences to Patrick Giannetto’s family.
CONSENT CALENDAR
Senior Management Analyst Kseniia Izgarskaia read the titles of the items included on the Consent Calendar. There were no public speakers for the consent calendar items.
IT WAS MOVED BY DEPUTY MAYOR SPELICH, SECONDED BY COUNCILMEMBER GAASTERLAND TO APPROVE THE CONSENT CALENDAR ITEMS 3 THROUGH 12, 14, 15, and
16. (VOTE 4-0, WITH COUNCILMEMBER QUIRK OPPOSED ON ITEM 12 (3-1-0)) Ayes: Mayor Martinez; Deputy Mayor Spelich; Councilmembers Gaasterland and Quirk; Noes:
Councilmember Quirk (Item 12 only); Recuse: 0; Absent: 0; Abstain: 0.
ITEM 3: APPROVAL OF MINUTES: JUNE 2, 2026 REGULAR AND SPECIAL MEETING (CLERK’S MINUTES BOOK)
Council approved the minutes, on consent.
ITEM 4: RATIFICATION OF LIST OF DEMANDS, DATED JUNE 16, 2026 (CLERK’S FILE NO. 201-3)
Council approved the list of demands, on consent.
ITEM 5: WAIVER OF READING OF ORDINANCES ON AGENDA (CLERK’S FILE NO. 401-4) Council waived the reading of ordinances, on consent.
ITEM 6: NINTH AMENDMENT TO THE PROFESSIONAL SERVICES AGREEMENT WITH KLEINFELDER, INC. FOR THE CAMINO DEL MAR BRIDGE REPLACEMENT PROJECT (CLERK’S FILE NO. 406-1)
Council approved the Ninth Amendment to the Professional Services Agreement with Kleinfelder, Inc. for engineering design services for the Camino Del Mar Bridge Replacement Project; and authorized the City Manager to execute the Ninth Amendment, on consent.
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ITEM 7: SEWER PIPELINE ROOT CONTROL SERVICES CONTRACT AWARD (CLERK’S FILE NO. 406-1)
Council approved an agreement with Duke’s Root Control, Inc. to provide sewer line root control services; and authorized the City Manager to execute the agreement, on consent.
ITEM 8: FIRST AMENDMENT TO AGREEMENT WITH MIKHAIL OGAWA ENGINEERING, INC.
FOR CLEAN WATER PROGRAM MANAGEMENT SERVICES (CLERK’S FILE NO. 406-1)
Council approved the First Amendment to the Agreement with Mikhail Ogawa Engineering, Inc. for Clean Water Program Management services, extending the term for an additional two-year period ending June 30, 2028, and adjusting fees for inflation; and authorized the City Manager to execute the Amendment, on consent.
ITEM 9: PROFESSIONAL SERVICE AGREEMENTS WITH THE DEL MAR VILLAGE
ASSOCIATION FOR ECONOMIC DEVELOPMENT AND BUSINESS SUPPORT AND DESTINATION MARKETING (CLERK’S FILE NO. 406-1, 1202-16) Council approved Agreements with the Del Mar Village Association for Economic Development, Business Support Services, and Destination Marketing Services; and authorized the City Manager to execute the Agreements, on consent.
ITEM 10: FIRST AMENDMENT TO AGREEMENT WITH DEL MAR COMMUNITY CONNECTIONS FOR SENIOR SUPPORT SERVICES (CLERK’S FILE NO. 406-1, 1202-15) Council approved the First Amendment to the Agreement between the City of Del Mar and Del Mar Community Connections (DMCC) for senior support services to extend the term for an additional two-year period ending June 30, 2028, and adjusted the scope of services and compensation; and authorized the City Manager to execute the First Amendment, on consent.
ITEM 11: FIRST AMENDMENT TO COMMUNICATIONS CONSULTANT SERVICES AGREEMENT (CLERK’S FILE NO. 406-1)
Council approved the First Amendment to the Agreement with Adam Kaye Communications for as-needed public information, communications, and outreach services, extending the term for an additional two-year period ending June 30, 2028; and authorized the City Manager to execute the First Amendment, on consent.
COUNCIL MEETING RECESS:
The City Council took a meeting recess from approximately 5:55 p.m. to 6:20 p.m.
CITY COUNCIL OTHER BUSINESS
ITEM 12: ADOPTION OF THE FISCAL YEAR 2026-27 BUDGET UPDATE (CLERK’S FILE NO. 202-1)
There were no public speakers for this item. Council questions focused on the budget changes from the last time the item was presented to the Council on June 2, 2026.
Pursuant to Senate Bill (SB) 707 requirements, Senior Management Analyst Izgarskaia provided an oral report summarizing a recommendation for a final action on the salaries, 4 July 7, 2026 Item 1
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June 16, 2026
salary schedules, or compensation paid in the form of fringe benefits to the executive and department head positions.
Council approved Resolution 2026-41 “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DEL MAR, CALIFORNIA, AMENDING THE FISCAL YEARS 2025-2026 and 2026-2027 OPERATING AND CAPITAL BUDGET;” Resolution 2026-42 “A
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DEL MAR, CALIFORNIA,
ADOPTING THE COMPENSATION PLANS FOR MANAGEMENT AND
PROFESSIONAL, FIRE, GENERAL, AND MISCELLANEOUS, PART-TIME,
TEMPORARY AND HOURLY EMPLOYEES, AND AUTHORIZING THE
RECLASSIFICATION OF THE FINANCE MANAGER POSITION TO FINANCE DIRECTOR;” Resolution 2026-43 “A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF DEL MAR, CALIFORNIA, ESTABLISHING THE FIXED CHARGE ASSESSMENTS FOR FISCAL YEAR 2026-2027;” Resolution 2026-44 “A RESOLUTION
OF THE CITY COUNCIL OF THE CITY OF DEL MAR, CALIFORNIA, ESTABLISHING THE APPROPRIATIONS LIMIT FOR FISCAL YEAR 2026-2027;” Resolution 2026-45 “A
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DEL MAR, CALIFORNIA, SETTING THE FISCAL YEAR 2026-2027 CITY OF DEL MAR FEE SCHEDULE FOR
PLANNING, PUBLIC WORKS, COMMUNITY SERVICES, AND ADMINISTRATION SERVICES;” and Resolution 2026-46 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DEL MAR, CALIFORNIA, SETTING THE FISCAL YEAR 2026-2027 PARKING VIOLATION FINES SCHEDULE,” on consent.
ITEM 13: REVIEW OF AFFORDABLE HOUSING CONCEPTS AND CITY COUNCIL DIRECTION ON INITIATION OF AN AFFORDABLE HOUSING OVERLAY ZONE (6TH CYCLE HOUSING ELEMENT PROGRAMS 1D AND 1I (CLERK’S FILE NO. 303-1, 304-7) A presentation was provided by City Principal Planner Amanda Lee and consultant Senior Planner Matt Gelbman from Ascent Environmental, Inc. Planning and Community Development Director Karen Brindley, Associate Planner Nicole Morrow, and City consultants Christine Babla, Principal Planner, and Veronica Alatorre, Associate Planner, with Ascent Environmental were available to answer questions.
City Attorney Cameron explained that Mayor Martinez, Deputy Mayor Spelich, and Councilmember Quirk are conflicted from participating in the discussion on Sites 3, 4, and 5, due to living within 500 feet of the subject sites and explained the procedure for a straw vote. A straw vote was conducted, and Deputy Mayor Spelich was selected to be recused from the item for Sites 3, 4, and 5.
Council questions and discussion focused on consultant findings identifying a need for increased floor area ratio (FAR) and lot coverage for affordable housing development, potential density bonus scenarios and possibility for applicants to request incentives/concessions and waivers for project feasibility, the relative height needed to develop downtown versus floodplain sites, objective design standards, and ability for future projects to be 100% residential or mixed-use development. Council emphasized the importance of view protection and prioritized limiting height. Staff clarified the overlay zone will provide a general framework for development and explained the importance of flexibility to ensure affordable housing development will be feasible on housing sites relied on in the Housing Element.
The Council separately considered Sites 3, 4, and 5 (Spelich recused) and Sites 1, 2, 6, and 7 (full Council). Mayor Martinez opened the item to public comment for each discussion with no public speakers.
Council provided direction for the new overlay zone to maintain existing discretionary permit processing until State law mandates ministerial processing (i.e., reliance on 6th Cycle housing sites again in 7 th
Cycle); identify site-specific development standards consistent with the Consultant report except for height on sites in floodplain (direction provided separately for Sites 3, 4, and 5); prioritize accommodation 5 July 7, 2026 Item 1
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June 16, 2026
of increases to FAR and lot coverage as an alternative to increased height; include objective design and development standards and a maximum average unit size; defer consideration of whether to exempt parking from the FAR calculation for consideration with the draft overlay zone; and defer Sites 8, 9, and 10 for consideration with the 7
th Cycle housing element.
For Sites 1, 2, 3, 4, and 5, Council direction was to limit height to 30 ft or the closest feasible minimum height above 30 ft to accommodate 3 stories, apply other site-specific development standards consistent with the Consultant report, and allow the higher site-specific FAR in concept 2 only for density bonus projects. For Sites 6 and 7, Council directed staff to apply site-specific development standards consistent with the Consultant report including the existing maximum 26-foot height limit of the base zone.
Council requested staff conduct additional analysis to ensure site-specific standards in the overlay zone are realistic, prepare additional visuals to show what project massing could look like, and bring this information forward with the public process and presentation of draft ordinance to create the new overlay zone.
ITEM 14: FISCAL YEAR 2026-2027 ADVISORY COMMITTEE WORK PLANS (CLERK’S FILE NO. 401-5)
There were no public speakers for this item. Council approved the proposed Fiscal Year (FY) 2026-2027 work plans for the City’s advisory committees, on consent.
ITEM 15: AMENDMENT TO THE FISCAL YEAR 2026-2027 CITY COUNCIL WORK PLAN TO REVISIT BICYCLE AND ELECTRIC BICYCLE REGULATIONS (CLERK’S FILE NO. 401-1)
There were no public speakers for this item. Deputy Mayor Spelich provided a brief explanation of the item and an overview of the recommended action.
Council approved the amendment of the Fiscal Year 2026-2027 City Work Plan to add an item directing staff to research potential amendments to the Del Mar Municipal Code related to bicycle and electric bicycle regulations and return to the City Council with any proposed changes to the City’s existing regulations, on consent.
ITEM 16: TRAFFIC AND PARKING ADVISORY COMMITTEE APPOINTMENT (CLERK’S FILE NO. 401-5)
There were no public speakers for this item. Council approved the appointment of Janet Wilson to the Traffic and Parking Advisory Committee for a full three-year term beginning June 16, 2026, and expiring June 30, 2029, on consent.
REGIONAL ORGANIZATION AND COUNCIL COMMITTEES/SUBCOMMITTEES/COMMUNITY
ORGANIZATION REPORTS
None.
ADJOURNMENT
Mayor Martinez adjourned the meeting at 8:00 p.m.
__
Kseniia Izgarskaia, Senior Management Analyst
6 July 7, 2026 Item 1
Vendor Payment Checks $ 1,109,737.51
Voids $0.00
Electronic Fund Transfers (EFT) 886,087.80
Electronic Wires 133,585.59
Total $ 2,129,410.90
Approved by: Approved by:
Marco Camacho Tracy Martinez
Finance Manager/Treasurer Mayor
Date: Date:
Attachments: Check Registers
LIST OF DEMANDS
CITY OF DEL MAR
for
City Council Meeting
July 7, 2026
6/29/26
1 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
1 11:32:07AM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7841 6/12/2026 cha71 CHARTER COMM HOLDINGS LLC, CHARTER COMMUNICATIONS 8448 41 006 01714635/13/2026 PUBLIC WIFI PHCC MAY 156.69 156.69 Voucher: 7841
7842 6/12/2026 dix01 DIXIELINE LUMBER CO 06-0644168 5/26/2026 OPERATING SUPP FIRE 156.09 Voucher: 7842 06-0643348 5/18/2026 OPERATING SUPP FIRE 68.50 06-0644026 5/22/2026 OPERATING SUPP FIRE 60.78
06-0643246 5/18/2026 OPERATING SUPP FIRE 11.02 296.39
7843 6/12/2026 ips02 IPS GROUP INC INV126045 5/31/2026 PRKG MTR TRANS FEE MAY 4,116.95 Voucher: 7843 INV124481 4/30/2026 PRKG MTR TRANS FEE APR 3,803.83 7,920.78 7844 6/12/2026 lif01 LIFE-ASSIST 2130231 5/26/2026 OPERATING SUPPLIES FIRE 609.00 609.00 Voucher: 7844
7845 6/12/2026 mic11 MICHAEL BAKER INTERNATIONAL 1281795 4/1/2026 CITY ENGR SRVCS FEB 63,794.27 Voucher: 7845 1278959 2/27/2026 CITY ENGR SRVCS JAN 44,697.27 108,491.54 7846 6/12/2026 pho01 PHOENIX GROUP INFO SYSTEMS 042026036 5/18/2026 CITE SRVCS - APR 19,110.14 19,110.14 Voucher: 7846
7847 6/12/2026 tru09 TRUE NORTH COMPLIANCE SRVCS DM26-02 3/9/2026 BLDG CODE PC INSP FEB 14,376.71 14,376.71 Voucher: 7847
Sub total for EFT GENERAL ACCOUNT US BANK: 150,961.25
Page: 1
2 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
2 11:32:07AM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141273 6/12/2026 sbc03 AT&T 9391059863 6/1/2026 TELEPHONE MAY 662.14 Voucher: 141273 9391026231 5/20/2026 TELEPHONE MAY 63.28 9391026228 5/20/2026 TELEPHONE MAY 32.42 757.84
141274 6/12/2026 cro52 CRONIN, JOHN 06012026 6/1/2026 PHCC REFUND 2026-218 800.00 800.00 Voucher: 141274
141275 6/12/2026 dun02 DUNN-EDWARDS PAINTS 2082A44255 5/31/2026 PAINT SUPPLIES CS 305.86 305.86 Voucher: 141275
141276 6/12/2026 eck03 ECKMANN, HELEN 06032026 6/3/2026 PHCC REFUND 2026-174 800.00 800.00 Voucher: 141276
141277 6/12/2026 flo08 FLORENCE MARINE X LLC INV0143803 6/26/2026 LFGD UNIFORMS 97.88 97.88 Voucher: 141277
141278 6/12/2026 ats01 GARDA CL WEST LOCKBOX #233209 10848296 6/1/2026 ARMORED SRVCS MAY 1,506.96 1,506.96 Voucher: 141278
141279 6/12/2026 kha03 KHAWAJA, MEHRAJ 06022026 6/2/2026 CITATION REFUND 109.00 109.00 Voucher: 141279
141280 6/12/2026 mon17 MONNICH, TORREY 06012026 6/1/2026 PHCC REFUND 2026-183 800.00 800.00 Voucher: 141280
141281 6/12/2026 boh02 NANCY K. BOHL INC. DBA:, THE COUNSELING TEAM INTL INV110063 6/1/2026 CONSULT SRVCS JUN 390.00 390.00 Voucher: 141281
141282 6/12/2026 pal04 PALOMAR SIGN COMPANY 10- 19101 6/8/2026 LFGD CUSTOM SIGN CS 1,225.38 1,225.38 Voucher: 141282
141283 6/12/2026 pha02 PHARMALINK INC 1092791 5/18/2026 DISPOSAL PHARMACEUTICALS 150.00 150.00 Voucher: 141283
141284 6/12/2026 pro24 PROGRESSIVE TECHNOLOGY, SECURITY SYSTEMS, INC 71721 6/1/2026 ALARM MONITORING LFGRD TWR JULY/SEP 162.00 Voucher: 141284 71724 6/1/2026 ALARM MONITORING LFGRD JUL/SEP 162.00 324.00 141285 6/12/2026 sta40 PSTRAX 98029 5/5/2026 ANNUAL LICENSE FEE 2,167.70 2,167.70 Voucher: 141285
141286 6/12/2026 san138 SAN DIEGO ELEVATOR & LIFTS7103143 4/1/2026 LIFT MAINT - LFGRDS 150.00 150.00 Voucher: 141286
141287 6/12/2026 sha19 SHARIFIRAD, PARVANEH 06032026 6/3/2026 JR LFGD REG REFUND 409.00 409.00 Voucher: 141287
141288 6/12/2026 she20 SHEARER, NANCY 06022026 6/2/2026 CITATION REFUND 25.00 25.00 Voucher: 141288
141289 6/12/2026 uni25 STAXUP - UNITS LLC 19333 6/6/2026 STORAGE CS JUN 289.85 289.85 Voucher: 141289
Page: 2
3 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
3 11:32:07AM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141290 6/12/2026 tei03 TEICHERT ENERGY & UTILITIES05062026 6/2/2026 UTILITY REFUND 1,186.72 1,186.72 Voucher: 141290
141291 6/12/2026 wil47 WILKINSON, KRISTEN 06082026 6/8/2026 PHCC REFUND 2026-058 800.00 800.00 Voucher: 141291
Sub total for GENERAL ACCOUNT US BANK: 12,295.19
Page: 3
4 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
4 11:32:07AM
apChkLst Final Page:
26 checks in this report. Grand Total All Checks: 163,256.44 Page: 4
Evy Escalante
6.11.26 5 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
1 4:21:16PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 4241 6/12/2026 irs01 IRS, UNITED STATES TREASURY Ben185212 6/12/2026 FEDERAL TAX: PAYMENT 55,074.65 55,074.65 Voucher: 4241
4244 6/12/2026 edd01 EMPLOYMENT DEVELOPMENT DEPT Ben185218 6/12/2026 STATE TAX: PAYMENT 15,897.08 15,897.08 Voucher: 4244
4245 6/12/2026 riv01 CALIFORNIA STATE DISBURSEMENT, RIVERSIDE COUNTY DCSS Ben185220 6/12/2026 RIVERSIDE CNTY CHILD SUPPORT: PAYMENT 294.23 294.23 Voucher: 4245
Sub total for GENERAL ACCOUNT US BANK: 71,265.96
Page: 1
6 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
2 4:21:16PM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7848 6/12/2026 mis07 107413 STATE ST BANK & TRUST, MS 107413 PLAN 401A Ben185208 6/12/2026 401A PLAN: PAYMENT 555.16 555.16 Voucher: 7848
7849 6/12/2026 mis08 303845 STATE ST BANK & TRUST, MS 457 PLAN OBI 303845 Ben185200 6/12/2026 MISSION SQUARE 457B: PAYMENT 10,982.12 10,982.12 Voucher: 7849
7850 6/12/2026 mis09 803808 STATE ST BANK & TRUST, MS RHS PLAN OBI 803808 Ben185210 6/12/2026 RETIREMENT HEALTH SAVINGS 3%: PAYMENT 748.81 748.81 Voucher: 7850
7851 6/12/2026 uni21 DEL MAR CITY EMPLOYEES ASSOC. Ben185202 6/12/2026 DMCEA DUES: PAYMENT 273.00 273.00 Voucher: 7851
7852 6/12/2026 nat15 NATIONAL BENEFIT SERVICES, LLC, FLEXIBLE BENEFITS DEPT Ben185206 6/12/2026 SEC. 125 FLEXIBLE SAVINGS ACCT: PAYMENT 2,337.39 2,337.39 Voucher: 7852
7853 6/12/2026 par21 U.S. BANK PARS FFC 6746022400, CITYDELMAR ATTN B BERGMAN Ben185204 6/12/2026 PUBLIC AGENCY RETIREMENT SRVCS: PAYMENT 3,395.19 3,395.19 Voucher: 7853
Sub total for EFT GENERAL ACCOUNT US BANK: 18,291.67
Page: 2
7 July 7, 2026 Item 2
06/11/2026
Check List
City of Del Mar
3 4:21:16PM
apChkLst Final Page:
9 checks in this report. Grand Total All Checks: 89,557.63 Page: 3
8 July 7, 2026 Item 2
06/15/2026
Check List
City of Del Mar
1 4:36:27PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 4242 6/12/2026 per01 PERS Ben185214 6/12/2026 PERS CONTRIBUTIONS: PAYMENT 59,081.37 59,081.37 Voucher: 4242
4243 6/12/2026 per02 PERS 457 Ben185216 6/12/2026 CALPERS 457 DEFERRED COMP: PAYMENT 3,238.26 3,238.26 Voucher: 4243
Sub total for GENERAL ACCOUNT US BANK: 62,319.63
Page: 1
9 July 7, 2026 Item 2
06/15/2026
Check List
City of Del Mar
2 4:36:27PM
apChkLst Final Page:
2 checks in this report. Grand Total All Checks: 62,319.63 Page: 2
10 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
1 12:24:45PM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7854 6/19/2026 kay01 ADAM KAYE CDMinvoiceMay20266/1/2026 COMM SRVCS MAY 3,900.00 3,900.00 Voucher: 7854
7855 6/19/2026 avi03 AVI SYSTEMS INC, DBA FORTE89162947 5/31/2026 CABLECAST UPGRADE 13,229.65 13,229.65 Voucher: 7855
7856 6/19/2026 azt02 AZTEC LANDSCAPING INC, DBA AZTEC JANITORIAL J2340 5/31/2026 JANITORIAL SRVCS CH MAY 2,564.00 Voucher: 7856 J2341 5/31/2026 JANITORIAL SRVCS PW MAY 501.00 3,065.00 7857 6/19/2026 civ02 CIVIC SOLUTIONS INC 108471 6/1/2026 CONSULTING SRVCS MAY 10,944.00 Voucher: 7857 108472 6/1/2026 CONSULTING SRVCS MAY 946.00 11,890.00 7858 6/19/2026 civ01 CIVICPLUS LLC 376505 6/9/2026 DESIGN SRVCS 480.00 480.00 Voucher: 7858
7859 6/19/2026 coa21 COAST NEWS GROUP 00161403 5/22/2026 AD - PUBLIC HEARING 201.50 Voucher: 7859 00161404 5/22/2026 AD - PUBLIC HEARING 178.25 00161492 5/29/2026 AD - PUBLIC HEARING V26-001 178.25 558.00 7860 6/19/2026 cor07 CORODATA RECORDS MGT INCRS7173995 5/31/2026 STORAGE SRVCS MAY 178.59 178.59 Voucher: 7860
7861 6/19/2026 cor23 CORODATA SHREDDING INC DN 1580663 5/31/2026 SHREDDING SRVCS MAY 55.76 55.76 Voucher: 7861
7862 6/19/2026 cor15 CORONADO MOBILE STORAGE INC 06012026 6/1/2026 STORAGE CONTRS JUN 255.00 255.00 Voucher: 7862
7863 6/19/2026 cor22 CORVEL CORPORATION 2041896 5/16/2026 MED MAINT - MAY 256.00 256.00 Voucher: 7863
7864 6/19/2026 dev02 DEVANEY PATE MORRIS & CAMERON 11785 5/15/2026 CITY ATTORNEY APR 28,833.60 Voucher: 7864 11778 5/15/2026 LEGAL FEES APR 14,190.00
11777 5/15/2026 LEGAL FEES APR 8,376.00
11782 5/15/2026 LEGAL FEES APR 6,612.40
11780 5/15/2026 LEGAL FEES APR 2,108.79
11779 5/15/2026 LEGAL FEES APR 1,274.00
11783 5/15/2026 LEGAL FEES APR 1,268.80
11781 5/15/2026 LEGAL FEES APR 1,125.15
11745 5/15/2026 LEGAL FEES APR 414.80
11784 5/15/2026 LEGAL FEES APR 292.80
11744 5/15/2026 LEGAL FEES APR 81.74
11776 5/15/2026 LEGAL FEES APR 49.00 64,627.08
Page: 1
11 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
2 12:24:45PM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7865 6/19/2026 dix01 DIXIELINE LUMBER CO 06-0645980 6/10/2026 OPERATING SUPP CS 485.46 Voucher: 7865 06-0646045 6/11/2026 OPERATING SUPP CS 176.12 06-0645696 6/9/2026 OPERATING SUPP PW 153.30
06-0646022 6/11/2026 OPERATING SUPP PW 120.14
06-0645587 6/8/2026 OPERATING SUPP CS 110.69
06-0645575 6/8/2026 OPERATING SUPP CS 94.16
06-0644995 6/2/2026 OPERATING SUPP CS 13.63 1,153.50
7866 6/19/2026 fer07 FERGUSON ENTERPRISES LLC, DBA FERGUSON WATERWORKS 0909099 6/9/2026 WATER METER PARTS 3,884.55 Voucher: 7866 0909100 6/9/2026 WATER METER PARTS 2,845.99 6,730.54 7867 6/19/2026 ful01 KURT MORGAN 45218 6/3/2026 UTILITY ENVELOPES 832.13 832.13 Voucher: 7867
7868 6/19/2026 mic11 MICHAEL BAKER INTERNATIONAL 1286426 5/15/2026 CITY ENGR SRVCS APR 31,530.88 Voucher: 7868 1287681 5/28/2026 CITY ENGR SRVCS APR 20,825.35 52,356.23 7869 6/19/2026 mik03 MIKHAIL OGAWA ENGINEERING12570 6/1/2026 CLEAN WATER SRVCS MAY 18,491.08 Voucher: 7869 12571 6/1/2026 SAN DIEGUITO TMDL MAY 1,913.08 12572 6/1/2026 DM TRASH DEVICE MAY 308.82
12573 6/1/2026 FOG SRVCS MAY 169.74 20,882.72
7870 6/19/2026 nv501 NV5 INC 520137 6/1/2026 PROF SRVCS 12,441.00 12,441.00 Voucher: 7870
7871 6/19/2026 opt03 OPTIMIZED INVESTMENT PARTNERS, LLC 1711 6/12/2026 INVSTMNT SRVCS MAY 3,281.44 3,281.44 Voucher: 7871
7872 6/19/2026 pho01 PHOENIX GROUP INFO SYSTEMS 0420261036 5/18/2026 ADMIN CITE SRVCS - APR 1,307.94 1,307.94 Voucher: 7872
7873 6/19/2026 red04 REDFLEX TRAFFIC SYSTEMS INC INV0123464 5/31/2026 RED LIGHT CAMERA MAY 5,441.49 5,441.49 Voucher: 7873
7874 6/19/2026 san12 SAN DIEGO COUNTY SHERIFF05272026 5/27/2026 LAW ENF APR 235,209.47 235,209.47 Voucher: 7874
7875 6/19/2026 san03 SAN DIEGO COUNTY WATER AUTH. 0526-2 6/9/2026 WATER DELIVERY 166,313.80 166,313.80 Voucher: 7875
7876 6/19/2026 sca12 SCA OF CA LLC CA25005781 1/30/2026 SWEEPING SRVCS JAN 3,371.68 3,371.68 Voucher: 7876
7877 6/19/2026 tow05 TOWNSEND PUBLIC AFFAIRS INC 25404 6/1/2026 LEGISLATIVE SRVCS JUN 4,500.00 4,500.00 Voucher: 7877
Page: 2
12 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
3 12:24:45PM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7878 6/19/2026 uti01 UTILITY SPECIALISTS INC 32559 5/31/2026 UP - X1A CREST CNYN APR 33,067.50 Voucher: 7878 32558 5/31/2026 UP - 1B STRATFORD N APR 1,441.25 32560 5/31/2026 UP - X1A CREST CNYN REIMB 414.70
32557 5/31/2026 UP - 1A STRATFORD S APR 290.00 35,213.45 7879 6/19/2026 wex01 WEX BANK 113103654 6/6/2026 GAS & OIL PW MAY 4,723.88 Voucher: 7879 113103642 6/6/2026 GAS & OIL FIRE MAY 1,941.12 6,665.00 Sub total for EFT GENERAL ACCOUNT US BANK: 654,195.47
Page: 3
13 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
4 12:24:45PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141292 6/19/2026 acm05 ACME SAFETY & SUPPLY CORP174334-00 6/10/2026 JDB FLAGGERS 1,197.50 Voucher: 141292 174306-00 6/8/2026 JDB FLAGGERS 1,197.50 2,395.00 141293 6/19/2026 alk01 ALKUINO, VICTORIA 06122026 6/12/2026 CITATION REFUND 109.00 109.00 Voucher: 141293
141294 6/19/2026 cal91 CALIFORNIA BANK & TRUST 06152026 6/15/2026 TC CONST RETENTION #8 39,650.48 39,650.48 Voucher: 141294
141295 6/19/2026 cin02 CINTAS 5339229001 6/1/2026 FIRST AID KIT SUPP CH 151.08 151.08 Voucher: 141295
141296 6/19/2026 sol01 CITY OF SOLANA BEACH 06162026 6/16/2026 OFF TRACK APR 1,503.08 Voucher: 141296 06162026 6/16/2026 OFF TRACK MAY 1,262.76 06162026 6/16/2026 OFF TRACK MAR 1,151.71
06162026 6/16/2026 OFF TRACK FEB 884.87 4,802.42
141297 6/19/2026 cou01 COUNTY OF SAN DIEGO 05112026 5/11/2026 PARKING BAIL - APR 32,380.00 32,380.00 Voucher: 141297
141298 6/19/2026 cro10 CROSS CONNECTIONS 2649-SBFD 6/1/2026 RADIOS - FIRE ENGINE 9,803.40 Voucher: 141298 26414-SBFD 6/1/2026 RADIOS - FIRE ENGINE 6,246.90 16,050.30 141299 6/19/2026 dat05 DATEL SYSTEMS INCORPORATED SI500914 4/9/2026 FACILITY REPAIR 716.11 Voucher: 141299 SI500913 4/9/2026 FACILITY REPAIRS 302.50 1,018.61 141300 6/19/2026 dyn03 DYNAMIC WHEELS IN MOTION, LLC 7036 6/9/2026 BIKE MAINT CS 55.00 55.00 Voucher: 141300
141301 6/19/2026 fis12 FISHER INTEGRATED INC 2384 6/1/2026 VIDEO STREAMING JUN 550.00 550.00 Voucher: 141301
141302 6/19/2026 fri06 FRIEDMAN & SPRINGWATER LLP 1001110 6/10/2026 UG CONSULT SRVCS 7,472.00 7,472.00 Voucher: 141302
141303 6/19/2026 gal02 GALLS LLC 035084083 5/18/2026 UNIFORMS CS 173.76 173.76 Voucher: 141303
141304 6/19/2026 gol16 GOLDFARB & LIPMAN LLP 494692 5/28/2026 LEGAL FEES APR 3,672.00 Voucher: 141304 493099 4/17/2026 LEGAL FEES MAR 1,496.00 5,168.00 141305 6/19/2026 gra02 GRAINGER 9948699328 6/11/2026 MAINT/REP SUPP PW 394.09 Voucher: 141305 9937306398 6/2/2026 MAINT/REP SUPP PW 234.75 628.84 141306 6/19/2026 hin06 HINDERLITER DE LLAMAS AND, ASSOC SIN064375 6/12/2026 SALES TAX SRVC - APR/JUN 1,308.54 Voucher: 141306 SIN064449 6/12/2026 MQ SRVCS - APR/MAY 330.69 1,639.23 141307 6/19/2026 nat16 NATIONAL SAFETY COMPLIANCE INC 104886 5/31/2026 EMPLOYEE TESTING 231.65 231.65 Voucher: 141307
Page: 4
14 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
5 12:24:45PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141308 6/19/2026 nct01 NCTD 730151 5/15/2026 ANNUAL LICENSE FEE 1,281.13 Voucher: 141308 730169 5/15/2026 ANNUAL LICENSE FEE 1,237.00 730206 5/15/2026 ANNUAL LICENSE FEE 232.00 2,750.13
141309 6/19/2026 pro24 PROGRESSIVE TECHNOLOGY, SECURITY SYSTEMS, INC 71725 6/1/2026 ALARM MONITORING TH JUL/SEP 162.00 Voucher: 141309 71723 6/1/2026 ALARM MONITORING LFGD JUL/SEP 162.00 71722 6/1/2026 ALARM MONITORING CH JUL/SEP 162.00 486.00 141310 6/19/2026 sup09 S D SYS INC 6775-221571 6/10/2026 DOOR REPAIRS CS 300.00 300.00 Voucher: 141310
141311 6/19/2026 san138 SAN DIEGO ELEVATOR & LIFTS7103006 3/18/2026 ELEVATOR MAINT CH MAR 250.00 250.00 Voucher: 141311
141312 6/19/2026 sdg02 SAN DIEGO GAS & ELECTRIC0081 7377 2988 5 6/8/2026 UTILITIES MAY 7,163.61 Voucher: 141312 0066 5491 6833 1 6/8/2026 UTILITIES MAY 4,721.83 0066 5392 2766 7 6/8/2026 UTILITIES MAY 1,137.33
0067 3735 0888 1 6/4/2026 UTILITIES MAY 257.44
0012 6209 1548 9 6/2/2026 UTILITIES MAY 111.14
2100 0065 8024 7 6/8/2026 UTILITIES MAY 50.92
0096 3381 7034 7 6/8/2026 UTILITIES MAY 22.71
0096 3381 7034 7 5/7/2026 UTILITIES APR 22.12
0099 5222 5392 9 6/4/2026 UTILITIES MAY 19.71
0053 7739 5442 0 6/8/2026 UTILITIES MAY 19.05
0053 7739 5442 0 5/7/2026 UTILITIES APR 18.87
0053 7739 5442 0 3/9/2026 UTILITIES FEB 18.86
0053 7739 5442 0 2/5/2026 UTILITIES JAN 18.49
0097 5436 8967 5 6/8/2026 UTILITIES MAY 18.26
0053 7739 5442 0 12/5/2025 UTILITIES NOV 18.02
0053 7739 5442 0 1/7/2026 UTILITIES DEC 17.88
0097 5436 8967 5 5/7/2026 UTILITIES APR 17.84
0096 3381 7034 7 4/9/2026 UTILITIES MAR -27.67
0053 7739 5442 0 4/9/2026 UTILITIES MAR -31.19
0097 5436 8967 5 4/9/2026 UTILITIES MAR -31.95
0053 7739 5442 0 11/5/2025 UTILITIES OCT -61.88 13,501.39 141313 6/19/2026 san20 SAN DIEGUITO RIVER PARK, A JOINT POWERS AUTHORITY 06162026 6/16/2026 OFF TRACK APR 751.54 Voucher: 141313 06162026 6/16/2026 OFF TRACK MAY 631.38 06162026 6/16/2026 OFF TRACK MAR 575.85
06162026 6/16/2026 OFF TRACK FEB 442.44 2,401.21
Page: 5
15 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
6 12:24:45PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141314 6/19/2026 sch69 SCHMIDT DESIGN GROUP INC25-412_07 6/19/2026 SHORES MASTER PLAN - APR 4,918.23 4,918.23 Voucher: 141314
141315 6/19/2026 sde01 SD ELECTRIC BIKE LLC, DBA SD ELECTRIC BIKE 16972 6/10/2026 ELEC BIKE MAINT CS 55.82 55.82 Voucher: 141315
141316 6/19/2026 sig12 SIGNA DIGITAL SOLUTIONS INCAR-S348338 6/12/2026 QTRLY COPIER CH 423.86 Voucher: 141316 AR-S345123 4/8/2026 COPIER LFGD QTRLY 184.69 43332116 6/11/2026 COPIER PW JUN 138.74 747.29
141317 6/19/2026 son04 SONNI-MEHTA, PREETI 06102026 6/10/2026 PHCC 2026-260 166.00 166.00 Voucher: 141317
141318 6/19/2026 sou08 SOUTHWEST SIGNAL SERVICE85052 5/31/2026 SIGNAL MAINT MAY 490.42 Voucher: 141318 85053 5/31/2026 SIGNAL MAINT MAY 146.62 637.04 141319 6/19/2026 tcc01 TC CONSTRUCTION COMPANY, INC 06152026 6/15/2026 UUD - XIA CREST CNYN #8 753,359.14 753,359.14 Voucher: 141319
141320 6/19/2026 hil14 THE HILLER COMPANIES, LLC168182 7/8/2025 FIRE EXTING REPAIR 809.54 Voucher: 141320 168180 7/8/2025 FIRE EXTING REPAIR 149.00 958.54 141321 6/19/2026 uni31 UNITED SITE SRVCS OF, CALIFORNIA INC 114-14238904 5/28/2026 PORTABLE RESTROOM MAY 1,450.85 Voucher: 141321 114-14238906 5/28/2026 PORTABLE RESTROOM MAY 565.25 114-14238905 5/28/2026 PORTABLE RESTROOM MAY 265.25 2,281.35 141322 6/19/2026 wax02 WAXIE'S ENTERPRISES, LLC. DBA, WAXIE SANITARY SUPPLY 83975415 6/12/2026 JANITORIAL SUPPLIES 12,866.02 Voucher: 141322 83975472 6/12/2026 JANITORIAL SUPPLIES 1,097.86 83975417 6/12/2026 JANITORIAL SUPPLIES 775.06
83970661 6/10/2026 JANITORIAL SUPPLIES 554.34
83961338 6/4/2026 JANITORIAL SUPPLIES 334.03
83962052 6/4/2026 JANITORIAL SUPPLIES 273.98
83970909 6/10/2026 JANITORIAL SUPPLIES 131.76 16,033.05 Sub total for GENERAL ACCOUNT US BANK: 911,320.56
Page: 6
16 July 7, 2026 Item 2
06/18/2026
Check List
City of Del Mar
7 12:24:45PM
apChkLst Final Page:
57 checks in this report. Grand Total All Checks: 1,565,516.03 Page: 7
17 July 7, 2026 Item 2
06/25/2026
Check List
City of Del Mar
1 12:41:34PM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7880 6/26/2026 cha71 CHARTER COMM HOLDINGS LLC, CHARTER COMMUNICATIONS 189125601 6/14/2026 INTERNET CH JUN 1,394.57 Voucher: 7880 189125701 6/14/2026 CH FIBER TO FIRE JUN 416.48 189123801 6/14/2026 LFGRD FIBER JUN 416.48
189112801 6/14/2026 VIDEO TRANSPORT/PEG JUN 338.39
189125801 6/14/2026 VIDEO TRANSPORT/PEG JUN 338.39
189125501 6/14/2026 PUBLIC WIFI CH JUN 119.99
189125401 6/14/2026 DMTV INTERNET JUN 119.99
189125201 6/14/2026 INTERNET TV STUDIO JUN 97.21 3,241.50 7881 6/26/2026 cos06 COSCO FIRE PROTECTION INC1000782095 6/18/2026 FIRE SPRINKLER/ALARM CH 2,705.00 Voucher: 7881 1000775693 5/11/2026 FIRE SPRINKLER MAINT CH 636.00 3,341.00 7882 6/26/2026 del31 DELL MARKETING L.P., C/O DELL USA LP 10876049503 5/21/2026 COMPUTER EQUIP PW 1,262.11 1,262.11 Voucher: 7882
7883 6/26/2026 dix01 DIXIELINE LUMBER CO 06-0645329 6/4/2026 OPERATING SUPP PW 487.02 Voucher: 7883 06-0644763 5/31/2026 OPERATING SUPP CS 464.35 06-0645560 6/8/2026 OPERATING SUPP PW 158.12 1,109.49
7884 6/26/2026 hel04 HELIX ENVIRONMENTAL PLANNING 134307 5/31/2026 RIVER PATH EXT PHASE 3 MAY 420.00 420.00 Voucher: 7884
7885 6/26/2026 kle01 KLEINFELDER 1595339 6/15/2026 CDM BRIDGE MAY 43,618.10 43,618.10 Voucher: 7885
7886 6/26/2026 man12 MANERI TRAFFIC CONTROL INC, DBA MTC 25737 6/8/2026 STREET SIGNS PW 624.23 624.23 Voucher: 7886
7887 6/26/2026 nv501 NV5 INC 524065 6/16/2026 GIS SRVCS MAY 7,210.50 7,210.50 Voucher: 7887
7888 6/26/2026 pac28 PACIFIC MOBILE STRUCTURES INC INV-00541321 7/1/2026 MOBILE OFFICE PW JUL 299.07 299.07 Voucher: 7888
7889 6/26/2026 pit01 PITNEY BOWES GLOBAL FIN SRVCS 3107927911 6/10/2026 EQUIP RENTAL 4/30-7/29 974.94 974.94 Voucher: 7889
Page: 1
18 July 7, 2026 Item 2
06/25/2026
Check List
City of Del Mar
2 12:41:34PM
apChkLst Final Page:
Bank : eusbnk EFT GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 7890 6/26/2026 pru01 PRUDENTIAL OVERALL SUPPLY132397847 5/29/2026 UNIFORMS PW - 6/26 82.11 Voucher: 7890 132395786 5/22/2026 UNIFORMS PW - 6/26 69.32 132399917 6/5/2026 UNIFORMS PW - 6/26 68.62
132401959 6/12/2026 UNIFORMS PW - 6/26 67.92
132401957 6/12/2026 MATS PW - 6/26 20.84
132397845 5/29/2026 MATS PW - 6/26 20.84
132397846 5/29/2026 TOWELS PW - 6/26 4.41
132401958 6/12/2026 TOWELS PW - 6/26 4.41 338.47
7891 6/26/2026 gan04 WILLIAM GANDER, DBA RESITEC, LLC DM-RT20260605 6/5/2026 SOLAR MONITORING MAY 200.00 200.00 Voucher: 7891
Sub total for EFT GENERAL ACCOUNT US BANK: 62,639.41
Page: 2
19 July 7, 2026 Item 2
06/25/2026
Check List
City of Del Mar
3 12:41:34PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141323 6/26/2026 bab03 BABCOCK LABORATORIES, INCCF60431-10666 6/8/2026 WATER TESTING 635.00 635.00 Voucher: 141323
141324 6/26/2026 cit07 CITY OF SAN DIEGO 1000453576 6/18/2026 WATER TREATMENT MAY 26,636.52 26,636.52 Voucher: 141324
141325 6/26/2026 com20 COMFORT SOLUTIONS GROUP DBA, UNIVERSAL AUTOMATION SVCS 1762 6/3/2026 HVAC SRVCS CH JUN 2,264.00 2,264.00 Voucher: 141325
141326 6/26/2026 cou37 COUNTY BACKFLOW 1252559 5/12/2026 BACKFLOW TEST 4,465.00 4,465.00 Voucher: 141326
141327 6/26/2026 cou16 COUNTY OF SAN DIEGO - REGIONAL, COMM SYSTEM 26CTOFDMC11 6/1/2026 RCS PAGING SRVCS - MAY 70.00 Voucher: 141327 26CTOFDMC10 5/1/2026 RCS PAGING SRVCS - APR 70.00 26CTOFDMC09 4/1/2026 RCS PAGING SRVCS - MAR 70.00 210.00 141328 6/26/2026 day03 DAY WIRELESS SYSTEMS INV925299 6/23/2026 VEH EQUIP LFGRD 1,051.59 1,051.59 Voucher: 141328
141329 6/26/2026 lee01 DCL ENTERPRISES INC DBA, LEE'S LOCK & SAFE 0000097884 6/17/2026 HARDWARE REPAIR PHCC 2,870.79 2,870.79 Voucher: 141329
141330 6/26/2026 del06 DEL MAR AUTOMOTIVE SERVICE 51827 6/22/2026 VEH MAINT CS #393 121.05 121.05 Voucher: 141330
141331 6/26/2026 dun02 DUNN-EDWARDS PAINTS 2082A44527 6/5/2026 PAINT SUPPLIES PW 66.52 66.52 Voucher: 141331
141332 6/26/2026 fab01 FABABIER, VINCENT 05182026 5/18/2026 PHCC REFUND 2026-070 800.00 800.00 Voucher: 141332
141333 6/26/2026 gra02 GRAINGER 9946546844 6/10/2026 MAINT/REP SUPP PW 2,588.43 Voucher: 141333 9954158656 6/16/2026 MAINT/REP SUPP PW 450.40 3,038.83 141334 6/26/2026 int09 GREGORY CONLEY, DBA INTELLIDESIGN LLC 520 6/8/2026 SCADA MAINT MAY 153.13 153.13 Voucher: 141334
141335 6/26/2026 har46 HARMONY ENVIRONMENTAL SERVICES 9249 6/16/2026 BIO-HAZARD CLEAN-UP SRVCS 548.91 548.91 Voucher: 141335
141336 6/26/2026 haw01 HAWTHORNE MACHINERY COMPANY SS000255898 5/5/2026 CATERPILLAR REPAIR PW 877.14 877.14 Voucher: 141336
141337 6/26/2026 hom01 HOME DEPOT CREDIT SRVCS6035 3225 0103 77605/28/2026 OPERATING SUPP PW 54.74 54.74 Voucher: 141337
141338 6/26/2026 aff04 IDRAINS LLC, DBA AFFORDABLE DRAIN SRVC 027864 6/4/2026 JETT/VACUUM CLEANING PW 10,088.00 10,088.00 Voucher: 141338
141339 6/26/2026 kim04 KIMBALL MIDWEST 104542520 6/9/2026 TOOLS/EQUIP PW 880.95 880.95 Voucher: 141339
Page: 3
20 July 7, 2026 Item 2
06/25/2026
Check List
City of Del Mar
4 12:41:34PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141340 6/26/2026 mar11 MARSHALLS INDUSTRIAL HARDWARE 801491/1 6/15/2026 TOOLS/EQUIP PW 110.19 110.19 Voucher: 141340
141341 6/26/2026 nap01 NAPA AUTO PARTS 759708 6/9/2026 VEHICLE MAINT SUPP PW 321.38 Voucher: 141341 759778 6/10/2026 OPERATING SUPP PW 113.17 759710 6/9/2026 OPERATING SUPP PW 20.82 455.37
141342 6/26/2026 nar05 NAREC 06182026 6/18/2026 PHCC REFUND 2026-257 800.00 800.00 Voucher: 141342
141343 6/26/2026 con17 OCCUPATIONAL HEALTH CTRS, OF CALIFORNIA, A MEDICAL 90885345 5/4/2026 EMPLOYEE TESTING MAY 214.00 Voucher: 141343 91303889 6/5/2026 EMPLOYEE TESTING JUN 214.00 428.00 141344 6/26/2026 oti01 OTIS ELEVATOR COMPANY SD19357001 3/26/2026 LIFT REPAIRS CS 1,940.00 1,940.00 Voucher: 141344
141345 6/26/2026 par35 PARADIGM MECHANICAL CORP, SAN DIEGO REFRIGERATION 115912 6/15/2026 HVAC SRVCS CH 2,515.65 2,515.65 Voucher: 141345
141346 6/26/2026 rez03 REZAI, SAID 06162026 6/16/2026 CITATION REFUND 54.00 54.00 Voucher: 141346
141347 6/26/2026 san138 SAN DIEGO ELEVATOR & LIFTS7103717 6/4/2026 ELEVATOR MAINT CH JUN 200.00 200.00 Voucher: 141347
141348 6/26/2026 sdg01 SAN DIEGO GAS & ELECTRIC0042 2198 4063 2 6/17/2026 UTILITIES MAY 4,843.03 4,843.03 Voucher: 141348
141349 6/26/2026 sdg02 SAN DIEGO GAS & ELECTRIC0092 4576 5583 8 6/15/2026 UTILITIES MAY 183.15 183.15 Voucher: 141349
141350 6/26/2026 sig12 SIGNA DIGITAL SOLUTIONS INC43370076 6/11/2026 COPIER CH 812.64 812.64 Voucher: 141350
141351 6/26/2026 nik02 SUSAN MONTADERT 8204 3/27/2026 FLAGS LFGRDS 1,294.37 1,294.37 Voucher: 141351
141352 6/26/2026 tei02 TEICHERT ENERGY & UTILITIES GR, DBA: TEICHERT UTILITIES 04222025 4/22/2026 UUD - 1A STRATFORD CT 112,133.05 112,133.05 Voucher: 141352
141353 6/26/2026 ter11 TERMINIX COMMERCIAL 472804398 6/5/2026 PEST CONTROL CH JUN 171.00 Voucher: 141353 472804493 6/5/2026 PEST CONTROL PHCC JUN 138.00 13937115 6/5/2026 PEST CONTROL PW - JUN 125.00
472804454 6/5/2026 PEST CONTROL CS JUN 121.00 555.00
141354 6/26/2026 ter01 TERMINIX INT CO LTD, PARTNERSHIP 473219078 6/17/2026 PEST CONTROL PW JUN 152.00 152.00 Voucher: 141354
141355 6/26/2026 tra51 TRANSLATION AND SIMULTANEOUS, INTERPRET DBA TRANS-LANG 5597-T 6/15/2026 ELECTION TRANSLATION SRVCS 200.00 200.00 Voucher: 141355
Page: 4
21 July 7, 2026 Item 2
06/25/2026
Check List
City of Del Mar
5 12:41:34PM
apChkLst Final Page:
Bank : gusbnk GENERAL ACCOUNT US BANK (Continued)
Check # Date Vendor Invoice Inv Date Description Amount Paid Check Total 141356 6/26/2026 sic02 VAN SICKLE, ANN 06172026 6/17/2026 PHCC REFUND 2026-177 800.00 800.00 Voucher: 141356
141357 6/26/2026 ver12 VERIZON Z2249644 6/8/2026 TELEPHONE MAY 2.64 2.64 Voucher: 141357
141358 6/26/2026 wax02 WAXIE'S ENTERPRISES, LLC. DBA, WAXIE SANITARY SUPPLY 83986529 6/19/2026 JANITORIAL SUPPLIES 1,698.41 1,698.41 Voucher: 141358
141359 6/26/2026 act03 WILLIAMS SCOTSMAN INC 9026387149 6/15/2026 MOBILE OFFICE PW JUN/JUL 156.12 156.12 Voucher: 141359
141360 6/26/2026 llo04 LLOYD EXCAVATING INC Ref000185222 6/16/2026 UB Refund Cst #00007598 1,970.97 1,970.97 Voucher: 141360
141361 6/26/2026 tei03 TEICHERT ENERGY & UTILITIESRef000185223 6/16/2026 UB Refund Cst #00008429 55.00 55.00 Voucher: 141361
Sub total for GENERAL ACCOUNT US BANK: 186,121.76
Page: 5
22 July 7, 2026 Item 2
06/25/2026
Check List
City of Del Mar
6 12:41:34PM
apChkLst Final Page:
51 checks in this report. Grand Total All Checks: 248,761.17 Page: 6
23 July 7, 2026 Item 2
City of Del Mar
Agenda Report
________________________________________________________________________________________________________ City Council Action:
TO: Honorable Mayor and City Councilmembers
FROM: Joe Bride, Public Works Director
Via Ashley Jones, City Manager
DATE: July 7, 2026
SUBJECT: Second Amended and Restated Regional Wastewater Disposal Agreement between the City of San Diego and the Participating Agencies in the Metropolitan Sewerage System
REQUESTED ACTION/RECOMMENDATION:
Staff recommends that the City Council adopt a Resolution (Attachment A) approving the Second Amended and Restated Regional Wastewater Disposal Agreement (SARA), as revised.
BACKGROUND:
The City of Del Mar operates an independent, City-owned and maintained wastewater system consisting of gravity sewer pipes, pump stations, and force mains serving City residents and businesses. To dispose of the City’s wastewater, the City has contracts in place with the San Elijo Joint Powers Authority (SEJPA) and Metropolitan Sewerage System (Metro System).
The City primarily contracts with the San Elijo Joint Power Authority (SEJPA) to transport wastewater to the San Elijo Water Reclamation Facility in the City of Encinitas (along with Encinitas, Rancho Santa Fe, and Solana Beach). The City is also a Participating Agency (PA) in the Metro System, which ultimately discharges wastewater to the Point Loma Wastewater Treatment Plant. Del Mar is one of twelve PAs that convey wastewater to the Metro System for treatment.
In 2016, infrastructure was constructed to allow the City to alternatively pump wastewater either to the Metro System or SEJPA. The City has pumped the majority of its wastewater to SEJPA since April 2018. However, Del Mar maintains its connection to the Metro System, which acts as an emergency backup system that is available during peak flow conditions should the SEJPA system become overwhelmed and unable to accommodate the City’s wastewater discharge. Having access to the Metro System avoids any risk to the City of costly spills and related fines by the San Diego Water Quality Control Board and comes at a very low cost to the City.
1 July 7, 2026 Item 4
Resolution Approving the Second Amended and Restated Regional Wastewater Disposal Agreement (SARA)
July 7, 2026
In 1998, a Regional Wastewater Disposal Agreement was negotiated between the City of San Diego and the Metro System PAs (including Del Mar). This agreement established roles and responsibilities, billing structures, and an advisory role for the PAs through the creation of the Metro Commission (a City of San Diego commission with one representative appointed by each PA). The agreement also provided for Metro Commission due diligence and review of shared costs related to the regional (later renamed “Metro”) facilities.
In 2000, the PAs formed the Metro Wastewater Joint Powers Authority (Metro JPA) as a separate legal entity authorized to act on matters related to the Regional Wastewater Disposal Agreement. The Metro JPA and the Metro Commission consist of the same appointed representatives and function as a single body.
The Metro JPA meets monthly in publicly noticed meetings with City of San Diego to approve costs, receive updates, and discuss regional wastewater matters. Del Mar is an original member of the Metro JPA and is currently represented by resident and former Councilmember Dwight Worden. The City’s Public Works Director represents the City on the Metro Technical Advisory Committee (TAC). The recommendation to approve the SARA is jointly supported by City staff and Mr. Worden as the City’s representative to the Metro JPA.
Several years ago, the City of San Diego and Metro JPA identified the need to modernize the 1998 agreement, which was no longer adequate for addressing evolving system needs. In 2021, the parties adopted an amended agreement intended as an interim measure. That amendment left six unresolved issues (referred to as the “Parking Lot Items”) to be addressed through future negotiations.
DISCUSSION/ANALYSIS:
Since 2021, the Metro JPA Executive Team has been negotiating the Second Amended and Restated Regional Wastewater Disposal Agreement (SARA). At the October 2, 2025, Metro JPA Board of Directors Meeting, the Metro JPA Board of Directors approved, by a vote of 11- 0-1 with one Director absent, a recommendation that the PAs approve the draft SARA subject to non-substantive revisions or corrections. The City of Del Mar approved the draft SARA at the January 20, 2026, meeting. All remaining PAs, except for Padre Dam Municipal Water District (Padre Dam MWD), have also approved the draft SARA that was presented at the October 2, Board meeting.
Since then, the Metro JPA Executive Team, together with staff and legal counsel from the City of San Diego and Padre Dam MWD, have worked diligently to negotiate and draft a revised version of SARA that would be acceptable to the City of San Diego, Padre Dam MWD, and the Metro Pure Water (SARA) Ad Hoc Committee. The negotiators were able to successfully agree to the revised draft of the SARA that is included for Council consideration at Attachment A. The Padre Dam MWD Board of Directors unanimously (with one absent) approved this revised version of the SARA at their June 17, 2026, Regular Meeting.
In summary, City staff considers the final SARA revisions to be non-substantial, which include:
2 July 7, 2026 Item 4
Resolution Approving the Second Amended and Restated Regional Wastewater Disposal Agreement (SARA)
July 7, 2026
1) A change from a two-thirds voting threshold to a three-fourths voting threshold with respect to billing-related changes (changes to the Functional Allocated Billing (FAB) methodology);
2) The inclusion of an illustrative example calculation of the FAB methodology, and 3) An effective date certain of July 1, 2026, irrespective of when the last party signs the revised SARA. This means that the SARA will not be effective until the last party approves and signs the agreement, but once the last party signs, the effective date of the SARA for all intents and purposes, including billing purposes, will be retroactive to July 1, 2026.
Overall, these changes implemented to the original October version of the agreement are more protective of and beneficial for the PAs, particularly, in relation to rate increases.
Therefore, staff recommends adopting the Resolution approving the revised SARA. The redlined version reflecting the revisions made to the October 2 SARA version are included as Attachment B as a reference.
FISCAL IMPACT:
There is no fiscal action to be taken by the City Council related to the recommended action.
Funds for the City’s estimated $21,000 annual cost under the SARA are available in the approved FY 2025-26 Operating Budget.
ENVIRONMENTAL IMPACT:
The proposed City Council action does not constitute a “project” under the definition set forth in California Environmental Quality Act (CEQA) Guidelines Section 15378 because it will not have a potential to result in a direct or indirect physical change in the environment and is, therefore, not subject to CEQA. No further action under CEQA is required.
NEXUS TO CITY COUNCIL GOALS AND PRIORITIES:
Amendments to City of San Diego Wastewater Transportation and Disposal Agreements is a Tier 1 City Council priority item.
ATTACHMENTS:
Attachment A – Resolution No. 2026-XX
Exhibit A – Revised SARA Agreement
Attachment B – Redline version of Revised SARA Agreement 3 July 7, 2026 Item 4
ATTACHMENT A
RESOLUTION NO. 2026-XX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DEL
MAR, CALIFORNIA, AUTHORIZING THE CITY MANAGER TO
APPROVE THE SECOND AMENDED AND RESTATED
REGIONAL WASTEWATER DISPOSAL AGREEMENT BETWEEN
THE CITY OF SAN DIEGO AND THE PARTICIPATING
AGENCIES IN THE METROPOLITAN SEWERAGE SYSTEM
WHEREAS, the 1998 Regional Wastewater Disposal Agreement between the City of San Diego and the participating agencies previously set planning, capacity rights and cost allocations of wastewater facilities in the Regional Metro Wastewater System; and WHEREAS, the City of Del Mar transports wastewater collected in the City to the Point Loma Wastewater Treatment Plant under the 1998 Regional Wastewater Disposal Agreement; and
WHEREAS, the City of Del Mar Resolution No. 2018-77 passed on the 29th day of October 2018, approved the First Amended and Restated Wastewater Disposal Agreement which addressed the amendments related to the Pure Water program and allocations of costs and financial protection of wastewater rate payers; and WHEREAS, further necessary modifications to the First Amended Regional Agreement precipitated a Second Amended and Restated Wastewater Disposal Agreement clarifying and expanding on items related to the wastewater billing methodology, agency roles and responsibilities, and cost-sharing approaches for Phase 1 and Phase 2 of the Pure Water Program; and
WHEREAS, the Second Amended and Restated Agreement was considered and approved by Metro Commission/ Metro JPA on October 2, 2025, with a vote of 11-1; and
WHEREAS, each participating agency and the City of San Diego are required to approve the Agreement independently, with the implementation date of July 1, 2026, following the last participating agency approval.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Del Mar, California, that:
1. The above recitals are true and correct;
2. The City Manager is authorized to approve and sign the Second Amended and Restated Regional Wastewater Disposal Agreement, and
3. For any future Metropolitan Sewerage Administration Agreements with nonsubstantive impacts to the City of Del Mar, the City Manager is authorized to sign such a modified agreement.
4 July 7, 2026 Item 4
Resolution No. 2026-XX
PASSED, APPROVED, AND ADOPTED by the City Council of the City of Del Mar, California, at the Regular Meeting held this 7th day of July 2026. _____________________________________
Tracy Martinez, Mayor
City of Del Mar
APPROVED AS TO FORM:
________________________________
Leslie E. Devaney, City Attorney
City of Del Mar
ATTEST AND CERTIFICATION:
STATE OF CALIFORNIA
COUNTY OF SAN DIEGO
CITY OF DEL MAR
I, SARAH KRIETOR, Administrative Services Manager/City Clerk of the City of Del Mar, California, DO HEREBY CERTIFY, that the foregoing is a true and correct copy of Resolution No. 2026-XX, adopted by the City Council of the City of Del Mar, California, at a Regular Meeting held the 7th day of July, 2026, by the following vote:
AYES:
NOES:
RECUSE:
ABSENT:
ABSTAIN:
Sarah Krietor, Administrative Services
Manager/City Clerk
City of Del Mar
5 July 7, 2026 Item 4
6-12-26
4932-3639-7490
SECOND AMENDED AND RESTATED
REGIONAL WASTEWATER DISPOSAL AGREEMENT
BETWEEN
THE CITY OF SAN DIEGO
AND
THE PARTICIPATING AGENCIES
IN
THE METROPOLITAN SEWERAGE SYSTEM
EXHIBIT A 6 July 7, 2026 Item 4
6-12-26
4932-3639-7490
TABLE OF CONTENTS
Page
1. DEFINITIONS .................................................................................................................... 3
2. OWNERSHIP AND OPERATION OF THE METRO SYSTEM ...................................... 9
2.1 Rights of the Parties ................................................................................................ 9
2.2 Metro System Services ........................................................................................... 9
2.3 Flow Commitment ................................................................................................ 10
2.4 Funding Obligations.............................................................................................. 10
2.5 Limitations on Types and Condition of Wastewater ............................................. 11
2.6 Enforcement Actions ............................................................................................. 12
2.7 Right of First Refusal ............................................................................................ 13
2.8 Uniform Enforcement of Pretreatment Program by City ...................................... 14
2.9 Wastewater Generated at Military Bases .............................................................. 16
3. CAPACITY RIGHTS ........................................................................................................ 16
3.1 Contract Capacity.................................................................................................. 16
3.2 Inter-Agency Transfers of Contract Capacity ....................................................... 17
3.3 New Contract Capacity ......................................................................................... 18
3.4 Reductions in Metro System Capacity .................................................................. 18
3.5 Restrictions on Veto of Transfers and Acquisitions of Capacity ........................... 18
3.6 Amendments to Exhibits B ................................................................................... 18
3.7 The South Bay Ocean Outfall ............................................................................... 19
4. FINANCE, BUDGETING, AND ACCOUNTING: PAYMENT AND MONITORING PROVISIONS ................................................................................................................... 19
4.1 Payment for Metro System Facilities .................................................................... 19
4.2 Payment for Additional Metro System Facilities .................................................. 19
4.3 Payment for Operation and Maintenance ............................................................. 19
4.4 Charges Based on Flow, Strength and Fixed Capacity: Exception ....................... 20
4.5 Monitoring Flow and Strength .............................................................................. 21
5. FINANCE, BUDGETING, AND ACCOUNTING: SYSTEM OF CHARGES............... 22
5.1 Charges Authorized ............................................................................................... 22
5.2 Functional Allocated Billing (FAB) ...................................................................... 22
5.3 Metro System Costs .............................................................................................. 23
5.4 Excluded Costs...................................................................................................... 23
5.5 Metro System Revenues and Allocations ............................................................. 24
5.6 Excluded Revenue ................................................................................................ 24
5.7 Estimate and Billing Schedule and Year End Adjustment .................................... 24
5.8 Financial Statements ............................................................................................. 25
5.9 Debt Financing ...................................................................................................... 26
5.10 Allocation of Operating Reserves and Debt Service Coverage ............................ 26
5.11 Amending the System of Charges ......................................................................... 26 EXHIBIT A 7 July 7, 2026 Item 4
6-12-26
4932-3639-7490
6. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 1 .............................................................. 26
6.1 North City Water Reclamation Plant Modification ............................................... 26
6.2 New, Expanded or Modified Metro System Facilities .......................................... 26
6.3 Costs Excluded from Metro System Costs – Phase 1 ........................................... 27
6.4 North City Water Reclamation Plant Improvement Costs Included as Metro System Costs ......................................................................................................... 27
6.5 Reallocation of PWP Costs incurred since FY 2014 ............................................ 28
6.6 Revenue Sharing for Repurified Water ................................................................. 29
6.7 Capital Expense Rate ............................................................................................ 30
6.8 Amending Pure Water Program Cost Allocation and Revenues – Phase 1 .......... 33
7. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 2 .............................................................. 33
7.1 Pure Water Program – Phase 2 .............................................................................. 33
7.2 Costs Excluded As Metro System Costs ............................................................... 33
7.3 Revenue Sharing for Repurified Water – Phase 2 ................................................. 34
7.4 Capital Expense Rate – Phase 2 ............................................................................ 34
8. FUTURE NEGOTIATIONS AND COOPERATION ....................................................... 34
9. THE METRO COMMISSION ......................................................................................... 34
9.2 Advisory Responsibilities of Metro JPA ............................................................... 35
9.3 Delegation of Decision-Making Authority of the Metro JPA ............................... 35
9.4 Standing ................................................................................................................ 35
10. DISPUTE RESOLUTION ................................................................................................ 35
10.1 Mandatory Non-Binding Mediation ..................................................................... 36
10.2 Selection of Mediator ............................................................................................ 36
10.3 Mediation Expenses .............................................................................................. 36
10.4 Conduct of Mediation ........................................................................................... 36
10.5 Mediation Results ................................................................................................. 36
10.6 Performance Required During Dispute ................................................................. 36
11. INSURANCE .................................................................................................................... 36
11.1 City Shall Maintain All Required Insurance ......................................................... 36
11.2 Substantially Equivalent Coverage ....................................................................... 37
12. INTERRUPTION OF SERVICE ...................................................................................... 37
13. NOTICES REQUIRED UNDER AGREEMENT ............................................................ 37
14. EFFECTIVE DATE AND EXPIRATION ........................................................................ 37
14.1 Effective Date ....................................................................................................... 37
14.2 Expiration .............................................................................................................. 38
14.3 Contract Capacity Rights Survive Expiration ....................................................... 38
14.4 Abandonment ........................................................................................................ 38 EXHIBIT A 8 July 7, 2026 Item 4
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15. ADMINISTRATIVE AGREEMENTS ............................................................................. 38
15.1 Use and Process for Administrative Agreements .................................................. 38
16. GENERAL ........................................................................................................................ 40
16.1 Exhibits ................................................................................................................. 40
16.2 Electronic Exhibits and Attachments .................................................................... 40
16.3 Amendments to Agreement ................................................................................... 41
16.4 Construction of Agreement ................................................................................... 43
16.5 Declarations Re: Agreement ................................................................................. 44
16.6 Right to Make Other Agreements ......................................................................... 45
16.7 Statute of Limitations to Resolve Billing Issues ................................................... 45
16.8 Counterparts and Electronic Signatures ................................................................ 45
16.9 Transparency ......................................................................................................... 46
16.10 Incorporation of Recitals ....................................................................................... 46
16.11 Joint Exercise of Power ........................................................................................ 46 ACRONYM LIST:
ARA Amended and Restated Regional Wastewater Disposal Agreement COD Chemical Oxygen Demand
CIP Capital Improvement Project(s)
CPM Construction Project Management
CWA San Diego County Water Authority
ECAWP JPA East County Advanced Water Purification Joint Powers Authority FAB Functional Allocated Billing
MBC Metropolitan Biosolids Center
MGD Millions of Gallons per Day
NCWRP North City Water Reclamation Plant
NPDES National Pollutant Discharge Elimination System
PLWTP Point Loma Wastewater Treatment Plant
PWP Pure Water Program
RSDP Reject Stream from Demineralization Process
SBOO South Bay Ocean Outfall
SBWRP South Bay Water Reclamation Plant
TSS Total Suspended Solids
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SECOND AMENDED AND RESTATED REGIONAL WASTEWATER DISPOSAL
AGREEMENT
THIS SECOND AMENDED AND RESTATED REGIONAL WASTEWATER
DISPOSAL AGREEMENT (“Agreement”) is made and entered into this 1st day of July, 2026, by and between the CITY OF SAN DIEGO, a municipal corporation (the “City”), on the one hand; and the CITY OF CHULA VISTA, a municipal corporation; the CITY OF CORONADO, a municipal corporation; the CITY OF DEL MAR, a municipal corporation; the CITY OF EL CAJON, a municipal corporation; the CITY OF IMPERIAL BEACH, a municipal corporation; the CITY OF LA MESA, a municipal corporation; the LEMON GROVE SANITATION DISTRICT, a political subdivision of the State of California; the CITY OF NATIONAL CITY, a municipal corporation; the CITY OF POWAY, a municipal corporation; the OTAY WATER DISTRICT, a political subdivision of the State of California; the PADRE DAM MUNICIPAL WATER DISTRICT, a political subdivision of the State of California; and the SAN DIEGO COUNTY SANITATION DISTRICT, a political subdivision of the State of California (collectively, the “Participating Agencies”), on the other hand. The City and the Participating Agencies may be referred to herein individually as a “Party,” and collectively as the “Parties.”
RECITALS
WHEREAS, the City and the Participating Agencies (or their predecessors in interest) entered into that certain Regional Wastewater Disposal Agreement dated May 18, 1998 (the “1998 Agreement”), which provided, among other things, for certain contract rights to capacity in the Metropolitan Sewerage System, a system of wastewater conveyance, treatment, and disposal facilities (“Metro System”) and the establishment of a mechanism to fund the planning, design, construction, operation, and maintenance of the Metro System by the City and the Participating Agencies; and
WHEREAS, the purposes of the 1998 Agreement were: (1) to replace the prior-existing sewage disposal agreements between the City and the Participating Agencies; (2) to provide certain contract rights to capacity in the Metro System to the Participating Agencies; (3) to establish a mechanism to fund the planning, design, construction, operation and maintenance of the Metro System by the City and the Participating Agencies as necessary to provide hydraulic capacity, and to comply with applicable law and with generally accepted engineering practices; and (4) to establish a system of charges which allocates the costs of the planning, design and construction of such new wastewater conveyance, treatment and disposal facilities as are necessary solely to provide for new capacity on a fair and equitable basis; and WHEREAS, on April 29, 2014 the San Diego City Council gave its approval and support for the Pure Water San Diego program by adoption of Resolution No. R-308906, which approved and supported the City’s efforts to develop an implementation strategy to offload wastewater flow from the Point Loma Wastewater Treatment Plant through implementation of potable reuse, resulting in effluent discharged to the Pacific Ocean being equivalent to what would be achieved by upgrading the Point Loma Wastewater Treatment Plant to a secondary treatment plant (secondary equivalency); and
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WHEREAS, the City is implementing a phased, multi-year program designed to achieve compliance with the Clean Water Act and regionally produce up to 83 million gallons per day of safe, reliable potable water using new, expanded, or modified facilities, some of which will include Metro System facilities, in order to achieve secondary equivalency at the Point Loma Wastewater Treatment Plant; and
WHEREAS, the Pure Water Program will not only benefit the City by producing repurified water, but also the Participating Agencies and their wastewater customers, especially if secondary equivalency is recognized through federal legislation amending the Clean Water Act. Specifically, implementation of the Pure Water Program will reduce wastewater discharges to the Point Loma Wastewater Treatment Plant, part of the Metro System where a large portion of the Participating Agencies’ wastewater is currently treated and disposed by discharging it into the Pacific Ocean.
By diverting wastewater from the Point Loma Wastewater Treatment Plant and reducing the effluent discharged into the Pacific Ocean, the City and the Participating Agencies will potentially avoid billions of dollars in unnecessary capital, financing, energy, and operating costs to upgrade the Point Loma plant to secondary treatment at full capacity. Avoiding such costs would result in significant savings for regional wastewater customers and achieve environmental benefits by reducing ocean discharge; and
WHEREAS, on or around November 2019, the East County Advanced Water Purification Joint Powers Authority (the “ECAWP JPA”) was created to implement a potable reuse program to improve local and regional water supply reliability to supply advanced treated recycled water to East San Diego County through the East County Advanced Water Purification Project (the “ECAWP Project”). The ECAWP Project is planned to capture and treat approximately 15 million gallons per day of wastewater that would otherwise be disposed of in the Metro System to produce an annual average supply of approximately 11.5 million gallons per day of new local drinking water. By diverting some wastewater and wastewater content away from the Metro System, the ECAWP Project has the ability to aid and contribute towards the City and region’s efforts to produce a regional annual average of up to 83 million gallons per day of water suitable for potable reuse by December 31, 2035, as described in the Cooperative Agreement in Support of Pure Water San Diego executed by the City and certain environmental stakeholders on December 9, 2014.
The ECAWP Project includes a residuals bypass system that will convey RSDP (as defined herein) from the advanced water purification facility, and Centrate from the solids dewatering process of the solids handling facility, to an existing regional sewage gravity pipeline owned and operated by the City for treatment and disposal; and
WHEREAS, effective on or around August 22, 2021, the City and the Participating Agencies amended the 1998 Agreement by executing an Amended and Restated Regional Wastewater Disposal Agreement (the “ARA”) to address the costs and revenues associated with Phase 1 of the Pure Water Program, including specific cost allocations related to the construction, expansion, and/or modification of Metro System facilities and Water Repurification System facilities designed to produce up to 30 million gallons per day of Repurified Water (“Phase 1”).
The ARA provided that within one year of its effective date, the Parties intended to meet and negotiate in good faith regarding one or more amendments to the ARA or to its Exhibits to address multiple outstanding items described in Section 2.9 of the ARA; and EXHIBIT A 11 July 7, 2026 Item 4
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WHEREAS, Section 14.2 of the ARA provided that the Parties may amend the ARA by a written agreement between the City and all Participating Agencies stating the Parties’ intent to amend or supplement the agreement; and
WHEREAS, in an effort to address in good faith the outstanding items described in Section 2.9 of the ARA, and comprehensively and equitably address the costs, revenues, and billing system associated with the Pure Water Program and the related construction, expansion, and/or modification of Metro System facilities beyond Phase 1, the City and Participating Agencies wish to amend and restate the ARA as provided herein.
NOW, THEREFORE, in consideration of the mutual promises set forth in this Agreement, the City and the Participating Agencies restate and amend the ARA and agree as follows:
1. DEFINITIONS
1.1 Administrative Agreement shall refer to a formal binding contract, approved under the process set forth in Section 15 of this Agreement, which implements technical, administrative, operational, and/or procedural details of this Agreement.
1.2 Administrative Approval is an approval mechanism authorized by this Agreement that refers to a City administrative process by which the subject of a particular action is presented to the City’s Director of the Public Utilities Department or their designee for approval, based on discussion and evaluation according to sound engineering standards if applicable, and any additional requirements related to review for the action requiring the City’s Administrative Approval as set forth in this Agreement.
1.3 Annual Average Daily Flow is the number, in millions of gallons of wastewater per day (“MGD”), calculated by dividing total Flow on a fiscal year basis by the number of days in the applicable year, which is a term used for billing purposes.
1.4 ARA shall mean the Amended and Restated Regional Wastewater Disposal Agreement between the City and the Participating Agencies effective August 22, 2021.
1.5 Capital Expense Rate shall mean the same as the term is defined in Section 6.7.2.
1.6 Capital Improvement Costs means all costs of the planning, design, financing, construction, and/or replacement necessary to render a capital project facility fully operational, including upgrades and reconstruction, consistent with the City’s policies and procedures. This includes costs for planning and environmental work; procurement of consultants or contractors to perform such work; construction management; investigative studies and pre-design work; labor and materials; inspection and testing; and financing cost including interest on financial instruments.
1.7 Centrate shall mean the liquid byproduct that results from the dewatering of digested solids as part of wastewater treatment processes.
1.8 Chemical Oxygen Demand or COD means the measure of the chemically decomposable material in wastewater, as determined by the procedures specified in the most EXHIBIT A 12 July 7, 2026 Item 4
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current edition of “Standard Methods for the Examination for Water and Wastewater,” or any successor publication which establishes the industry standard.
1.9 City shall mean and refer to the City of San Diego.
1.10 City’s Water Utility shall mean any and all facilities, properties, improvements and works at any time owned, controlled or operated by the City as part of the public utility system of the City for water purposes, for the development, obtaining, conservation, production, storage, treatment, transmission, furnishing and distribution of water and its other commodities or byproducts for public and private use (whether located within or without the City), and any related or incidental operations designated by the City as part of the Water System, including reclaimed and re-purified water.
1.11 City Water Utility PWP Costs are those Pure Water Program costs allocated to the City’s Water Utility and therefore excluded as Metro System Costs under Section 6.3 of this Agreement.
1.12 Contract Capacity is the contractual right possessed by each Participating Agency to discharge wastewater into the Metro System pursuant to this Agreement up to the limits set forth in Exhibit B, Distribution of Wastewater System Capacity Rights, attached hereto.
1.13 Contract Capacity Transfers shall refer to the capacity transfers initiated based on Metered Flow and Strength data using the methodology set forth in Exhibit E, Methodology for Contract Capacity Transfers, which change a Participating Agency’s Contract Capacity, as set forth more fully in Section 4.4.3.1 and 4.4.3.2. These changes will generally be made to a single Participating Agency’s annual Contract Capacity to correct capacity exceedances but can also be made to reduce a Participating Agency’s Contract Capacity.
1.14 CWA shall mean the San Diego County Water Authority.
1.15 ECAWP JPA shall mean the East County Advanced Water Purification Joint Powers Authority. The ECAWP JPA itself is not a Participating Agency or a Party to this Agreement.
1.16 ECAWP JPA Agencies shall mean collectively the City of El Cajon, the Padre Dam Municipal Water District, and the San Diego County Sanitation District.
1.17 ECAWP Project shall mean the ECAWP JPA’s project to capture and treat wastewater that would otherwise be disposed of in the Metro System to produce an annual average supply of approximately 11.5 MGD of new local drinking water, as well as other byproducts such as recycled water and energy recovery facilities.
1.18 Fixed Capacity shall mean the capacities for Monthly Average Daily Flow, Incremental Peak Flow, RSDP, COD and TSS for each agency as set forth in Exhibit B.
1.19 Fixed Capacity Charge shall mean the charges set forth in Exhibit B that are identified as “Fixed Capacity Charges” that represent the Parties’ proportional charges for EXHIBIT A 13 July 7, 2026 Item 4
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maintaining the Metro System. Items such as debt service are also included in the Fixed Capacity Charges.
1.20 Flow shall refer to the flow of wastewater discharged by the City and/or one or more Participating Agency/ies into the Metro System.
1.21 Functional Allocated Billing or FAB shall mean the method for distributing all capital, operations, and maintenance Metro System Costs and Revenues on an annual basis by grouping expenses according to their purposes and the current approved Functional-Design Methodology.
1.22 Functional-Design Methodology shall mean the process of allocating fixed and variable Operation and Maintenance Costs and Capital Improvement Costs to Flow, RSDP and Strength parameters recognizing the benefits of both the design criteria and the primary function of a unit process.
1.23 Incremental Peak Flow shall mean the Peak Flow minus the Monthly Average Daily Flow.
1.24 Industrial Wastewater means all wastewater, excluding domestic wastewater, and shall include all wastewater from any producing, manufacturing, processing, institutional, commercial, service, agricultural, or other operation. These may also include wastes of human origin similar to domestic wastewater.
1.25 Industrial User means a discharger of Industrial Wastewater to a public sewer. A Participating Agency may be an Industrial User.
1.26 Joint Administrative Approval Process is an approval process authorized by this Agreement by which an Administrative Agreement may be created, revised, supplemented, replaced or terminated, subject to the review and approval process set forth more fully in Section 15.
1.27 MBC Return shall mean and refer to Centrate created at the Metropolitan Biosolids Center, 5240 Convoy St, San Diego, CA 92111. MBC Return shall contain Metered Flow, TSS and COD.
1.28 Metered Flow shall mean the amount or volume of wastewater captured by meters that exist throughout the Metro System, estimates from unit count areas, or agreed upon estimates of flows where unit counts are not appropriate. When meters are out of service, estimates can be used to fill in data gaps. These meters, which may or may not be owned by the City, are further defined in Exhibit F, Metro System Flow Formulas and Sampling Locations, which may be amended from time to time.
1.29 Metro Commission or Metro JPA is the advisory body described under Section 9.
1.30 Metro System Costs shall mean, at a minimum, those costs set forth in Section 5.3 and as otherwise set forth in this Agreement.
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1.31 Metro System Revenues are those revenues set forth in Section 5.5.
1.32 Metropolitan Sewerage System or Metro System shall mean and consist of those facilities which are listed, shown and/or described in Exhibit A, Metro Facilities (Electronic Exhibit); file name: [Enter]; time stamp of file, software used to open and view file including version; included herewith as CD-ROM/DVD-ROM, including any amendments thereto authorized by this Agreement. Exhibit A includes current constructed facilities and proposed future facilities.
1.33 Monthly Average Daily Flow is the number, in MGD, calculated by dividing total Flow on a monthly basis by the number of days in that month.
1.34 Municipal System shall mean the City’s wastewater collection system, consisting of pipelines and pump stations, which collects wastewater within the City of San Diego and conveys it to the Metropolitan Sewerage System for treatment and disposal.
1.35 New Contract Capacity shall mean capacity in excess of the Contract Capacity set forth in Exhibit B and authorized subject to Section 3.3.
1.36 North City Water Reclamation Plant or NCWRP is the wastewater treatment facility located at 4949 Eastgate Mall in San Diego, which includes four major processes: primary treatment, secondary treatment, tertiary treatment, and disinfection.
1.37 Operation and Maintenance Costs are the costs to operate, maintain, manage, repair, and keep the Metro System conveyance, disposal, treatment, and reuse facilities functioning in accordance with all applicable laws, rules, and regulations.
1.38 Participating Agencies shall mean all the local governments and agencies that executed this Agreement other than the City.
1.39 Peak Flow represents the wastewater flow in millions of gallons of wastewater per day that is captured in the highest 1-hour period in a fiscal year.
1.40 Point Loma Wastewater Treatment Plant or PLWTP is the main City wastewater treatment plant with a Monthly Average Daily Flow capacity of 240 million gallons per day and a peak flow capacity of 432 million gallons per day (as of the date of this Agreement). It is an advanced primary treatment plant which includes four major processes: screening, grit removal, chemically enhanced sedimentation, and digestion.
1.41 Pooled Capacity shall refer to the capacity in the Metro system greater than that which has been designated in Exhibit B. Pooled Capacity amounts are shown in Exhibit E, Methodology for Contract Capacity Transfers, and may be recalculated from time to time as set forth more fully in this Agreement.
1.42 Postage Stamp Methodology is a methodology that can allocate a single uniform cost to any of the annual Contract Capacity cost parameters identified in Exhibit B. This methodology assumes that even though a particular discharger may not utilize all of the infrastructure, all dischargers into the Metro System benefit from the shared infrastructure.
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1.43 Projected Future Strength and Flow Amounts are the five (5) values described below:
1.43.1 Projected Future Metro Flow is the estimated amount of Monthly Average Daily Flow, stated in millions of gallons per day (MGD), that the City and each Participating Agency are projected to have in a designated future year – currently, the 2050 fiscal year. Projected Future Metro Flow for each Party is stated in Exhibit B.
1.43.2 Projected Future Incremental Peak Flow is the estimated amount of Annual Incremental Peak Flow, stated in millions of gallons per day (MGD), that the City and each Participating Agency are projected to have in a designated future year – currently, the 2050 fiscal year. Projected Future Incremental Peak Metro Flow for each Party is stated in Exhibit B.
1.43.3 Projected Future RSDP Flow is the estimated amount of RSDP Flow, stated in millions of gallons per day (MGD), that the City and each Participating Agency are projected to have in a designated future year – currently, the 2050 fiscal year. Projected Future RSDP Flow for each Party is stated in Exhibit B.
1.43.4 Projected Future COD Flows is the estimated amount of Chemical Oxygen Demand (COD), stated in pounds per day, that the City and each Participating Agency are projected to have in a designated fiscal year – currently, the 2050 fiscal year. Projected Future COD Flows for each Party are stated in Exhibit B.
1.43.5 Projected Future TSS Flows is the estimated amount of Total Suspended Solids (TSS) stated in pounds per day, that the City and each Participating Agency are projected to have in a designated fiscal year – currently, the 2050 fiscal year. Projected Future TSS Flows for each Party are stated in Exhibit B.
1.44 Pure Water Capital Melded Percentage is the proportionate share stated in Column 7 of Exhibit B (formerly Column 12 of Exhibit G of the ARA), by which Pure Water Program Capital Improvement Costs, Repurified Water Revenue, and the Capital Expense Rate will be allocated among the City and the Participating Agencies. The Pure Water Capital Melded Percentage is based on each Party’s proportionate share of Projected Future Metro Flow, Projected Future TSS Flows, and Projected Future COD Flows, which proportions are weighted as described in Footnote 5 of Exhibit B.
1.45 Pure Water Program or PWP is the City’s phased, multi-year program designed to produce up to 83 million gallons per day of Repurified Water using new, expanded, or modified facilities, some of which will include Metro System facilities.
1.46 PWP Phase 1 or Phase 1 shall mean the first phase of the Pure Water Program, which modifies/constructs Metro System and Water Repurification System facilities and is designed to produce an annual average of 30 million gallons per day of Repurified Water.
1.47 PWP Phase 2 or Phase 2 shall mean the second phase of the Pure Water Program which modifies/constructs Metro System and Water Repurification System facilities and is designed to produce up to an additional annual average of 53 million gallons per day of Repurified Water.
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1.48 Recycled Water shall have the definition set forth in Title 22, Division 4 of the California Code of Regulations and shall mean water which, as a result of treatment of wastewater, is suitable for a direct beneficial use or a controlled use that otherwise could not occur.
1.49 Reject Stream from Demineralization Process or RSDP is a flow reject stream and treatment byproduct from a demineralization process at a potable reuse facility that primarily contains liquid and salts.
1.50 Repurified Water shall mean water which, as a result of advanced treatment of Recycled Water, is suitable for use as a source of domestic (or potable) water supply.
1.51 Repurified Water Revenue is the cost savings that will be realized when the City’s Water Utility’s annual costs per-acre foot for Repurified Water, including City Water Utility PW Costs, are less than the purchase costs per-acre foot for comparable water from the San Diego County Water Authority, as further described in Section 6.
1.52 Residuals shall mean RSDP and Centrate. In the future, Residuals may include other waste byproducts if the Parties agree in writing that other byproducts may be discharged into the Metro System.
1.53 South Bay Ocean Outfall or SBOO is the facility that is jointly owned by the International Boundary & Water Commission (U.S. Section IBWC) and the City. The outfall conveys and discharges treated effluent from the IBWC’s International Wastewater Treatment Plant and treated effluent from the City’s South Bay Water Reclamation Plant. As of the date of this Agreement, the outfall has a current Average Daily Flow Capacity of 174 million gallons per day. As of the date of this Agreement, the City owns 39.94% of the capacity of the outfall and the balance of the capacity is owned by the IBWC.
1.54 South Bay Water Reclamation Plant or SBWRP is the wastewater treatment facility located at 2411 Dairy Mart Road in San Diego, which includes four major processes:
primary treatment, secondary treatment, tertiary treatment, and disinfection.
1.55 Strength means the measurement of Total Suspended Solids and Chemical Oxygen Demand within the Flow and any other measurement required by law after the date of this Agreement or necessary for the Functional Design Methodology.
1.56 Total Suspended Solids or TSS means the insoluble solid matter in wastewater that is separable by laboratory filtration, as determined by the procedures specified in the most current edition of “Standard Methods for the Examination of Water and Wastewater,” or any successor publication which establishes the industry standard.
1.57 Tertiary Component is that portion of the wastewater treatment process that currently filters the secondary treated wastewater effluent through fine sand and/or anthracite coal to remove fine suspended solids and disinfects it to meet the requirements of the California Administrative Code, Title 22, or its successor for filtered and disinfected wastewater used for recycled and repurified water.
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1.58 Two-Party Approval is an approval mechanism under this Agreement that requires the City’s Administrative Approval and a two-thirds (2/3) vote or greater of the Metro JPA Directors present at a duly noticed Metro JPA public meeting as described more particularly in Section 16.
1.59 Variable Costs shall refer to the portion of the Functional Design Methodology costs that are allocated based on Metered Flow and Strength.
1.60 Water Repurification System shall mean any facilities, including treatment and conveyance facilities, the purpose of which is the production or conveyance of Repurified Water.
Water Repurification System includes, but is not limited to: the Tertiary Component of the North City Water Reclamation Plant to the extent being used to produce Repurified Water, the North City Pure Water Facility; the Repurified Water conveyance system, which will transport Repurified Water from the North City Pure Water Facility and/or other facilities to the Miramar Reservoir or other alternative location(s) as determined by the City; and any other Repurified Water treatment or conveyance facilities which are part of the Pure Water Program. These facilities are constructed and maintained at the expense of the City water utility and are excluded Metro System Costs under this Agreement.
2. OWNERSHIP AND OPERATION OF THE METRO SYSTEM
2.1 Rights of the Parties. The City is the owner of the Metro System, and any additions to the Metro System or other facilities constructed pursuant to this Agreement. As more particularly set forth in this Agreement, and subject to the terms and conditions of this Agreement, the rights of the Parties generally include the following:
2.1.1 All decisions with respect to the planning, design, construction, operation and maintenance of the Metro System shall rest with the City, in consultation with the Metro JPA.
2.1.2 The Participating Agencies shall have a contractual right to use the Metro System and to participate in its operation.
2.1.3 The City may transfer ownership of all or part of the Metro System at any time. In the event of a transfer, including a sale under Section 2.7, the City’s successor shall be bound by the terms of this Agreement, and the Participating Agencies rights under this Agreement shall not be affected by such a transfer.
2.1.4 Any Participating Agency may transfer or assign its rights and obligations under this Agreement. Any transfer shall first be approved by the City. No transfer may occur if the City reasonably determines, after consultation with the Participating Agencies involved, that the proposed transfer will imbalance or adversely impact the City’s ability to operate the Metro System.
2.2 Metro System Services.
2.2.1 The City shall provide wastewater conveyance, treatment and disposal services to the Participating Agencies through the Metro System, under the terms set forth in this Agreement.
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2.2.2 The City shall operate the Metro System in an efficient and economical manner, maintaining it in good repair and working order, all in accordance with recognized sound engineering and management practices.
2.2.3 The City shall convey, treat, and dispose of or reuse all wastewater received under this Agreement in such a manner as to comply with all applicable laws, rules and regulations.
2.3 Flow Commitment.
2.3.1 Subject to the provisions of this Agreement and absent a separate agreement of the Parties, all Flow within the capacity limits set forth in Exhibit B or any amendments or changes thereto shall remain in the Metro System.
2.3.2 This Agreement shall not preclude any Party from diverting Flow as a result of the construction of reclamation/reuse facilities or New Capacity outside of the Metro System.
2.3.3 Any Participating Agency may negotiate an agreement with the City to reduce all or part of their Contract Capacity. If a Participating Agency reduces its Contract Capacity to zero, that Participating Agency’s rights shall terminate under this Agreement and that Participating Agency shall no longer be considered a member of the Metro JPA. However, the agreement between the City and Participating Agency shall provide that the Participating Agency pays its proportionate share of Capital Improvement Costs for the remainder of the useful life of the facility(ies) constructed during the time the Participating Agency possessed Contract Capacity in the Metro System. This shall include, but is not limited to, any remaining portions of outstanding debt that was incurred for capital facilities during the time the Participating Agency had the right to send Flow into the Metro System, and the cost to disconnect the Participating Agency’s system from the Metro System. Any Contract Capacity that a Participating Agency chooses to relinquish under this section shall be treated as Pooled Capacity after the effective date of an agreement between the City and that Participating Agency. This section does not apply to Inter-Agency transfers of Contract Capacity, which involve the relinquished Contract Capacity being assigned to and assumed by another Participating Agency or the City. Inter-Agency transfers are governed by Section 3.2
2.3.4 Flow Projections. Currently, the Projected Future Strength and Flow Amounts are projected to the year 2050 in order to allow the Parties time to plan for future development and growth. However, these projections may be amended from time to time through the Exhibit B amendment processes in this Agreement to more fairly align with actual flow and strength data. The parties shall begin discussion to recalculate the Projected Future Strength and Flow Amounts set forth in Exhibit B by no later than January 1, 2040.
2.4 Funding Obligations. The City shall fund the acquisition, construction, maintenance and/or operation of the Metro System from monies in (or sewer revenues which populate) the Sewer Revenue Fund for the Metro System, and/or from construction funds derived from the sale of duly authorized sewer revenue bonds for the Metro System. Nothing in this Section or Agreement shall (i) obligate the City to make any payment for the acquisition, construction, maintenance or operation of the Metro System from monies derived from taxes or any other income or revenue of the City; (ii) be construed to obligate the City or any Participating EXHIBIT A 19 July 7, 2026 Item 4
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Agency to pay from its annual income and revenues any sum which would create an indebtedness, obligation or liability within the meaning of the provisions of Section 18 of Article XVI of the Constitution of the State of California and, in the City’s case, San Diego Charter Section 99; or (iii) prevent the City, in its discretion, from using tax revenues or any other available revenues or funds of the City for any purpose for which the City is empowered to expend moneys under this Agreement. For the avoidance of doubt, subsections (i) and (ii) shall not relieve the City from its obligations to fund the Metro System as provided in this Section 2.4.
2.5 Limitations on Types and Condition of Wastewater.
2.5.1 Each Participating Agency shall minimize to the maximum extent practicable, the infiltration and inflow of surface, ground or stormwaters into its respective wastewater systems.
2.5.2 Each Participating Agency will ensure that all Industrial Users of its wastewater system are regulated by and comply with the City’s industrial pretreatment program.
City shall not require the Participating Agencies to take any actions against such Industrial Users beyond that which are (1) required under applicable laws, rules and regulations, (2) taken by the City, or (3) that can be taken, but are not being taken by the City.
2.5.3 City and the Participating Agencies agree that the Interjurisdictional Pretreatment Agreements executed by and between the City and each Participating Agency, as applicable, shall terminate effective upon the date of this Agreement. However, the separate transportation agreements that are currently in effect between or among the City and the Participating Agencies shall remain in effect in accordance with their terms. Each Participating Agency will not discharge wastewater originating outside its respective boundaries into the Metro System without the approval of the City, which shall not be unreasonably withheld.
2.5.4 Each Participating Agency shall be responsible for the violation of any applicable laws, rules or regulations associated with its respective discharge of wastewater into the Metro System. Nothing in this Agreement shall affect or prohibit the ability of any Participating Agency to hold third parties responsible for such violations. However, City shall be responsible for enforcement actions related to the violation of any applicable laws, rules, or regulations associated with industrial waste dischargers regulated by City, though each Participating Agency shall collaborate with City when necessary, on any enforcement response for pretreatment violations within a Participating Agency’s jurisdiction. However, the City shall not be responsible for enforcement or monitoring related to a Participating Agency’s compliance with its own NPDES Permit.
2.5.5 Food establishments and dischargers of fats, oils, and grease (FOG) are regulated and monitored by individual Participating Agencies within their jurisdiction.
Participating Agencies are responsible for the provision of FOG programs, services, and enforcement within their jurisdiction. The City will not provide FOG-related services or programs outside of the City’s jurisdiction.
2.5.6 Residuals shall be separately conveyed so that the Residuals bypass all secondary wastewater treatment processes, unless otherwise agreed to in writing by the City and a EXHIBIT A 20 July 7, 2026 Item 4
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Participating Agency or the City and a group of Participating Agencies. For the avoidance of doubt, the Agreement regarding Operation and Maintenance of the East County Residuals Line entered into by the City and the ECAWP JPA with an effective date of February 6, 2023 (specifically, Exhibit C to that agreement entitled Principles of Understanding for Operation and Residuals Management in Lieu of the East County Residuals Line), is an agreement that allows the Residuals from the ECAWP Project to convey Residuals in a manner that does not bypass all secondary wastewater treatment processes under certain conditions.
2.6 Enforcement Actions. In the event a regulatory agency, imposes any penalty or fine, or takes other enforcement action, or a private citizen brings a citizen enforcement action to enforce regulatory requirements, (collectively, “Enforcement Actions”) relating to the conveyance, treatment, or disposal of wastewater in or from the Metro System or operation of the Metro System, the City shall determine as part of its investigation and response to the notice of violation whether the City or a Participating Agency or Agencies caused or contributed to the violation for reasons which may include, without limitation, exceeding their Contract Capacity, the contents of their wastewater, or the failure to maintain or operate the Metro System or a Participating Agency’s system. Any costs associated with an Enforcement Action including but not limited to fines, penalties, corrective measures, and costs of defense (collectively, “Penalty(ies)”) shall be shared by the Participating Agencies and the City proportionately based on Fixed Capacity as set forth in the then current Exhibit B, unless the City determines, based on verifiable facts, that the violation for which the Penalty is imposed was caused by, or was the result of, gross negligence or willful misconduct of the City or a Participating Agency.
2.6.1 For any Enforcement Actions (1) related to sanitary sewer overflows of 10,000,000 gallons or more from the Metro System occurring after the effective date of this Agreement, or (2) that the City reasonably anticipates will result in the Participating Agencies’ collective responsibility for the Penalties imposed to exceed 10% of the Metro Participating Agencies combined annual operations and maintenance budget for the Metro System for the fiscal year in which the Penalty is imposed (“Threshold Amount”), the City’s determination will be subject to review by the Metro JPA as set forth in 2.6.1.1 through 2.6.1.8 below. The scope of the Metro JPA’s review shall be limited to whether the violation for which the Penalty is imposed was caused by, or was the result of, gross negligence or willful misconduct of the City or a Participating Agency, and if so, how the Penalty should be fairly allocated. For all other Enforcement Actions, the City’s determination related to the allocation of Penalty shall be final.
2.6.1.1 The City will provide a copy of any report submitted to a regulatory agency in response to an Enforcement Action to the Metro JPA within 30 days of submitting that report to the regulatory agency. In that same communication, the City will also provide a summary of the City’s findings regarding causation and preliminary determination regarding the allocation of any Penalties. If these determinations have not been made, the City will provide an anticipated date that the information will be provided.
2.6.1.2 If the Metro JPA disputes the City’s determination as to the allocation, as evidenced by a vote approved by two-thirds of the Metro JPA Directors present at a duly noticed meeting, it shall notify the City in writing of the same within 90 days of receiving the City’s preliminary allocation determination.
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2.6.1.3 The City and representatives of the Metro JPA shall meet and confer to discuss the matter and try to reach an agreement on the appropriate allocation. To facilitate resolution, the meet and confer process shall be treated as a settlement discussion under the California Evidence Code and shall be a confidential process. The meet and confer process shall focus on whether the violation for which the Penalties are being imposed is the result, in whole or in part, of the gross negligence or willful misconduct of the City or a Participating Agency, and if so, how the Penalties shall be allocated.
2.6.1.4 If through the meet and confer process, the City determines that the Participating Agencies’ collective responsibility for the Penalties imposed will be less than the Threshold Amount, then the City will inform the Metro JPA of this determination and allocate the Penalty as such, and no further action by the Metro JPA is required.
2.6.1.5 If through the meet and confer process, the City and representatives of the Metro JPA reach an agreement, and the Participating Agencies’ collective responsibility for the Penalties imposed will be equal to or greater than the Threshold Amount, then that agreement shall be subject to the Two-Party Approval process. The City and representatives of the Metro JPA shall have an opportunity to present the proposed agreement to the Metro JPA before a vote on the determination.
2.6.1.6 If the City and representatives of the Metro JPA are unable to reach an agreement and Participating Agencies’ collective responsibility for the Penalties imposed is equal to or exceeds the Threshold Amount, the City will make a final determination regarding allocation of the Penalty and present the determination to the Metro Commission.
2.6.1.7 In the event that Two Party Approval is required but is not achieved, each Participating Agency shall pay the portion of the Penalty allocated to them at the time that it is invoiced, however, such payment may be made under protest. The Parties shall engage in the dispute resolution procedures under this Agreement to resolve the issue, prior to any Party having the right to initiate litigation.
2.6.1.8 Penalties in excess of the Threshold Amount shall be separated out in the reconciliation billing and notated as a spill penalty with reference to the first day of the spill associated with the penalty.
2.7 Right of First Refusal.
2.7.1 The City shall not sell or agree to sell the Metro System without first offering it to the Participating Agencies. For the purposes of this section, “Participating Agencies” shall mean a Participating Agency, a group of Participating Agencies, or a third party representing one or more Participating Agencies. The term “sell” shall include any transfer or conveyance of the Metro System or of any individual treatment, collection, or reclamation facility or outfall within the Metro System.
2.7.2 The City and the Participating Agencies recognize that transfer of ownership of the Metro System is currently restricted by Sections 6.04 and 6.20 of the Installment Purchase Agreement between the City and the Public Facilities Financing Authority of the City, which inter alia restricts the transfer of ownership to the Metropolitan Wastewater Sewage District EXHIBIT A 22 July 7, 2026 Item 4
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or other governmental agency whose primary purpose is to provide wastewater treatment. The City shall not seek to impose on bond holders a waiver of Section 6.04 or 6.20. Absent such a restriction, before the City sells or agrees to sell the Metro System, or any portion of it, the City shall offer to sell the Metro System to the Participating Agencies (the “Offer”) on the terms and at a price equal to that proposed for the sale of the Metro System to a third party. The City shall provide all Participating Agencies with written notice of the Offer per Section 13 . The Participating Agencies shall have ninety (90) days from the date of mailing of the Offer (the “Intent to Respond Period”) in which to notify the City of their intent to respond to the Offer. If a Participating Agency or Agencies notify the City of their intent to respond to the Offer, that Participating Agency or those Agencies shall have five months from the expiration of the Intent to Respond Period in which to accept or reject the Offer. The Offer shall contain the name of the proposed purchaser, the proposed sale price, the terms of payment, the required deposit, the time and place for the close of escrow, and any other material terms and conditions on which the sale is to be consummated. If no Participating Agency or Agencies notifies the City of its (or their) intent to respond to the Offer within the Intent to Respond Period, the City may move forward with the sale of the Metro System without further notice to the Participating Agency in accordance with Section 2.7.3 below.
2.7.3 If the Participating Agencies give timely notice of their intent to respond and timely notice of their acceptance of the Offer, then the City shall be obligated to sell and the Participating Agencies shall be obligated to purchase the Metro System or any individual treatment, collection or reclamation facility or outfall within the Metro System, as applicable, at the price and on the terms and conditions of the Offer. If the Participating Agencies do not give timely notice of their intent to respond or their acceptance of the Offer, or do not submit an offer on the same terms and conditions as the Offer, the City may, following the end of the Offer period, sell the Metro System, or any portion of it, at a price and on terms and conditions no less favorable to the City than those in the Offer. The City shall not sell the Metro System to any third party on terms or at a price less favorable to the City from the terms and price contained in the Offer absent compliance with the terms of this Section. The City’s sale of the Metro System under Section 2.7, is a transfer of ownership subject to Section 2.1.3.
2.7.4 Nothing herein shall prevent the City from entering into a financing agreement which may impose limits on the City’s power to sell the Metro System to the Participating Agencies pursuant to Section 2.7.1 if the City reasonably believes that such a financing agreement is in the City’s best interest. Neither the entry into such a financing agreement by the City nor the performance thereof by the City shall constitute a breach or default by the City hereunder.
2.8 Uniform Enforcement of Pretreatment Program by City. The Parties have determined that it is in their best interests for a single agency to be responsible for management of the pretreatment program for the Metro System in order to: (a) Ensure protection of the entire Metro System, including the successful operation of the Pure Water Program; (b) Provide consistent and uniform regulation of Industrial Users, including those subject to pretreatment requirements; (c) Provide for transparent and fair cost recovery from all dischargers; and (d) Promote efficiency and accountability in the administration of the Metro System. For these reasons, the Parties are delegating pretreatment responsibilities to the City, except regulation of Food Establishments and FOG dischargers, as more fully set forth in this Agreement and in Administrative Agreement #1 Between City of San Diego and Participating Agencies for the EXHIBIT A 23 July 7, 2026 Item 4
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Unified Management of Industrial Waste Discharge Pretreatment and Enhanced Source Control Programs (“Administrative Agreement #1”). Notwithstanding the above, the City may enter into supplementary agreements with an individual Participating Agency, or a group of Participating Agencies, relating to industrial waste discharge pretreatment and enhanced source control programs unique to such Participating Agency(ies), so long as the supplementary agreement incorporates a separate cost proportional to the participation of such Participating Agency or group of Participating Agencies that is the sole responsibility of such Participating Agency(ies).
2.8.1 Delegation of Authority. Each Participating Agency shall and hereby does delegate to City full authority and responsibility to operate, manage, and enforce an effective pretreatment program throughout the Metro System to ensure that all Industrial Users are subject to uniform rules and regulations, with direct billing to Industrial Users by the City to begin on the first July 1 following execution of this Agreement.
2.8.2 Operations and Maintenance. Procedures relating to the operation, management, enforcement, and cost recovery for the pretreatment program are set forth in Administrative Agreement #1.
2.8.3 Amending Pretreatment Program Procedures. Administrative Agreement #1 may be amended from time to time as set forth in Section 15. In the event of any conflict between this Agreement and Administrative Agreement #1, the terms of this Agreement shall control.
2.8.4 Adoption of Local Ordinances. By no later than June 30 following the Effective Date of this Agreement, every Participating Agency shall adopt a local ordinance conforming with the sample ordinance contained in Administrative Agreement #1 and the City’s pretreatment ordinance, each as amended from time to time, to ensure consistency throughout the Metro System.
2.8.5 Identification of New Industrial Users. Participating Agencies shall notify the City of any identified potential new Industrial Users within their respective boundaries while the City will bear responsibility for inventory assessments on a regular basis as set forth in Administrative Agreement #1.
2.8.6 Permitting and Permit Compliance. Nothing in this Agreement shall be construed to relieve any discharger to the Metro System of the responsibility to obtain and comply with any required permits for, and to comply with rules and regulations applicable to, dischargers to the Metro System. If the City determines that an Industrial Wastewater Control Program Permit is required, it shall issue the permit subject to the City’s permit requirements. The City’s approval or denial of any application for, or revocation of, an Industrial User Permit shall be in accordance with Chapter 6, Article 4 of the San Diego Municipal Code as well as any other applicable federal, state or local regulations, any published City guidance related to the Industrial Wastewater Control Program, and the City’s Enforcement Response Plan, all as may be amended, renumbered, or renamed from time to time. The City and any Participating Agency may elect to coordinate and combine issuing their wastewater discharge permits to Industrial Users when deemed appropriate by both parties. Any agreement between the City and the Participating Agencies related to permitting under the Industrial Wastewater Control Program, shall not transfer responsibility to City for any other type of permitting outside of the City’s jurisdiction, or subject any local agency EXHIBIT A 24 July 7, 2026 Item 4
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as that term is defined in California Government Code section 53090, to local building and zoning ordinances that the local agency is not otherwise legally subject to.
2.8.7 Inventory of Industrial Users. City shall create and maintain an inventory of all Industrial User within the Metro System as soon as reasonably practicable following execution of this Agreement. The Participating Agencies shall review the inventory and shall notify the City of an Industrial User(s) in its jurisdiction that is not identified on the inventory as set forth in Administrative Agreement #1.
2.8.8 Evaluation, Monitoring, Enforcement and Program Review. Upon the effective date of this Agreement, it shall be the City’s right and obligation to carry out pretreatment evaluation, permitting, monitoring and/or enforcement throughout the Metro System consistent with the procedures set forth in Administrative Agreement #1. The City’s pretreatment program review shall occur as necessary, but no less than once every five (5) years. Nothing herein shall be construed as prohibiting any Participating Agency from enforcement of its own pretreatment ordinance within its jurisdiction.
2.8.9 City’s Direct Billing of Industrial Users. The City shall directly bill Industrial User throughout the Metro System to recover costs associated with the pretreatment program as set forth in Administrative Agreement #1. The City Council shall set and approve such costs in a publicly noticed meeting pursuant to the procedures set forth in Administrative Agreement #1.
2.9 Wastewater Generated at Military Bases. The City may contract directly with federal military bases that are connected to the Metro System for wastewater services and capacity subject to the terms of this Section 2.9. If a United States military base is located within a Participating Agency’s jurisdiction, the Participating Agency may request that the City bill that military base directly as a separate and distinct customer. In the event the City agrees to accept the military’s wastewater and bill the military base as a separate and distinct customer, then (1) the Participating Agency shall have no billing obligations with respect to the military base; (2) each Participating Agency whose sewage line conveys the military base’s wastewater reserves the right to negotiate and charge the federal government a conveyance or transportation fee for use of that Participating Agency’s sewer line; (3) the City shall require that the military base comply with the applicable City pretreatment rules; and (4) the City agrees that the wastewater generated by the military base shall not be considered wastewater of the Participating Agency with respect to capacity once the City enters into an agreement with the military base. Any transfers of capacity that are appropriate or necessary to accommodate flow from military bases, if needed, would be governed by Section 3.2 herein, “Inter-Agency Transfers of Contract Capacity.”
3. CAPACITY RIGHTS
3.1 Contract Capacity. Each Participating Agency shall have the contractual right to discharge wastewater to the Metro System up to the limits set forth in Exhibit B (“Contract Capacity”). Each Party’s Contract Capacity as stated in Exhibit B, is used for the purpose of allocating the Metro System’s Pure Water Program Capital Improvement Costs, Repurified Water Revenue, and the Capital Expense Rate under this Agreement.
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3.2 Inter-Agency Transfers of Contract Capacity. The Participating Agencies and the City may buy, transfer, sell or exchange all or part of their Contract Capacity among themselves on such terms as they may agree upon, subject to the following:
3.2.1 Any Party requesting to buy, transfer, sell, or exchange all or part of their Contract Capacity (“Inter-Agency Transfer”) shall provide a written proposal to the City including the proposed terms of such Inter-Agency Transfer. The Party requesting the Inter-Agency Transfer shall also provide notice to all other Participating Agencies under Section 13 concurrently with submitting the proposal to the City.
3.2.2 All Participating Agencies will have 45 days to provide any technical input to the City regarding the proposed Inter-Agency Transfer. Any Participating Agency providing technical input shall provide a copy of such input to all other Participating Agencies under Section 13 concurrently with submitting the input to the City.
3.2.3 Upon receipt of a request for an Inter-Agency Transfer, the City will review the request, consult with the affected Participating Agencies, and consider any technical input provided by other Participating Agencies.
3.2.4 All proposed purchases, transfers, sales or exchanges of Contract Capacity require the City’s Administrative Approval prior to becoming effective. No Contract Capacity may be transferred if the City determines that said transfer will imbalance, or will otherwise adversely impact the City’s ability to operate the Metro System. Provided, however, that the Participating Agency seeking the transfer may offer to cure such imbalance at its own expense. If the Participating Agency makes such an offer, the City may not unreasonably withhold Administrative Approval.
3.2.5 If the City approves the offer as proposed, the City shall adjust the Contract Capacity set forth in Exhibit B per Section 3.6 to reflect the approved changes. If the City determines, after taking the steps in Section 3.2.3 that an Inter-Agency Transfer may be approved if the request is modified, the City will provide a written notice to all Participating Agencies of the modified Inter-Agency Transfer under Section 13 no less than 30 days prior to the Inter-Agency Transfer becoming effective. Such modified Inter-Agency Transfer will become effective 30 days following the written notice being provided, and the City will prove an updated Exhibit B per Section 3.6 reflecting the approved changes.
3.2.6 If a Participating Agency reduces its Contract Capacity to zero through an Inter-Agency Transfer, that Participating Agency’s rights under this Agreement shall terminate and that Participating Agency shall no longer be a member of the Metro JPA. The Participating Agency shall remain responsible for all outstanding financial obligations under this Agreement, unless the Inter-Agency Transfer Agreement assigns those obligations to the Participating Agency accepting the transfer and that agency assumes those obligations. Outstanding financial obligations include, but are not limited to, a Participating Agency’s proportionate share of Capital Improvement Costs for the remainder of the useful life of the facility(ies) constructed during the time the Participating Agency possessed Contract Capacity in the Metro System, including any remaining portions of outstanding debt incurred for capital facilities during the time the Participating Agency had the EXHIBIT A 26 July 7, 2026 Item 4
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right to send Flow into the Metro System, and the cost to disconnect the Participating Agency’s system from the Metro System.
3.3 New Contract Capacity. The Parties recognize that the Metro System may be modified to create capacity in the Metro System beyond that set forth in Exhibit B as a result of the construction of additional facilities, acquisition of facilities, increased flows, or as required by regulatory or similar such action. If capacity in excess of the Contract Capacity (“New Contract Capacity”) is required or requested by a Party, the Parties shall negotiate in good faith to provide the needed or requested capacity. If the Parties agree to provide New Contract Capacity, they shall memorialize the agreement for New Contract Capacity in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. If the parties execute an Administrative Agreement for New Contract Capacity, Exhibit B shall also be adjusted pursuant to Section 3.6 to reflect the New Contract Capacity.
3.4 Reductions in Metro System Capacity. The Parties further recognize that Metro System Capacity may be reduced to comply with, or in response to, applicable permit conditions, or related regulatory action, or sound engineering principles. In the event that the capacity of the Metro System is re-rated to levels below the numbers reflected in the Totals Line set forth in Exhibit B, then the Contract Capacity shall be reallocated proportionately among the Parties based on the percentages of fixed ownership set forth in Exhibit B at that point in time, subject to the City’s Administrative Approval and amendment of Exhibit B.
3.5 Restrictions on Veto of Transfers and Acquisitions of Capacity. Each Party understands and agrees that no Participating Agency has a right to veto or prevent the transfer of capacity between other Participating Agencies or the City, nor the creation or acquisition of new capacity for another Participating Agency or Agencies. By signing this Agreement, each Participating Agency is expressly preapproving such actions. The sole right of a Participating Agency to object to any of the foregoing shall be through expression of its opinion to the Metro JPA and, where applicable, through exercise of its rights under the dispute resolution provisions of this Agreement.
3.6 Amendments to Exhibits B. If the City determines that an amendment to Exhibit B is required for any reason other than a request from a Participating Agency under Sections 2.3.3 and Sections 3.2, and that reason only requires the City’s Administrative Approval, the City shall prepare and circulate to all Participating Agencies a notice explaining the facts and circumstances that the City’s determination is based on(including any relevant data available), and the proposed amendment to Exhibit B within 60 days of determining such an amendment is necessary. The Participating Agencies will have sixty (60) days to provide comments to the City, and all comments submitted to the City by a Participating Agency shall also concurrently be submitted to all other Participating Agencies. The City will review all comments received, prepare final amendments to Exhibit B to reflect adjustments in Contract Capacity, and circulate the final amended Exhibit B by no later than sixty (60) days after the City’s Administrative Approval. If the amendment to Exhibit B requires an approval process other than the City’s Administrative Approval, the Parties will follow the required approval process, and once that is completed, the City will prepare and provide the final version of Exhibit B within 60 days of the completion of the approval process.
The City shall note each amendment and amendment date in the Exhibit List and shall keep an EXHIBIT A 27 July 7, 2026 Item 4
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updated version of Exhibit B on file with the City Public Utilities Department at all times. An amendment to Exhibit B shall not be retroactive, except as provided in Section 4.4.3.3.
3.7 The South Bay Ocean Outfall. Nothing in this Agreement shall limit the City’s right to transfer capacity rights in assets that are not a part of the Metro System, including without limitation that portion of the South Bay Ocean Outfall which is not part of the Metro System.
4. FINANCE, BUDGETING, AND ACCOUNTING: PAYMENT AND MONITORING
PROVISIONS
4.1 Payment for Metro System Facilities. Through the system of charges set forth in Section 5 of this Agreement, each Participating Agency shall pay its share of the costs of planning, design and construction of all of the Metro System facilities which are identified in Exhibit A .
4.2 Payment for Additional Metro System Facilities. Through the system of charges set forth in Section 5 of this Agreement, each Participating Agency shall pay its share of the costs of acquisition, planning, design and construction of such facilities, in addition to those set forth on Exhibit A, as are necessary to (a) convey, treat, dispose, and reuse wastewater in the Metro System; (b) provide the Contract Capacity set forth in Exhibit B; and (c) maintain hydraulic capacity as otherwise required by sound engineering principles. Each Participating Agency shall pay its share of the costs necessary to ensure the Metro System maintains compliance with applicable laws, rules and regulations, including the Ocean Pollution Reduction Act of 1994 and its successor(s), as well as present and future waivers of applicable treatment standards at any Metro System treatment facility. Exhibit A may be amended to reflect replaced or rehabilitated facilities, or changes in facilities, subject to the City’s Administrative Approval; however, if the City proposes to add a new Metro facility to Exhibit A, or convert a City facility to a Metro facility that will be added to Exhibit A, then each such amendment shall be (1) subject to the City’s Administrative Approval, in its sole discretion, when the addition or conversion is for the purpose of complying with applicable laws, rules, or regulations; or (2) supported by an independent third-party study setting forth the benefits to the Metro System of each new facility, including a cost allocation for capital and projected annual maintenance costs if the addition or conversion is for any other purpose. For any new Metro facility or conversion of a City facility to a Metro facility proposed to be added or converted under (2) above, any such proposal must be memorialized in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. Once approved, the City shall amend Exhibit A accordingly and shall give notice of any amendments to all Participating Agencies. The City shall keep an updated version of Exhibit A on file with the City Public Utilities Department. Exhibit A may be amended to reflect other changes to the Metro System only as expressly provided in this Agreement.
4.3 Payment for Operation and Maintenance. Through the system of charges set forth in Section 5 of this Agreement, each Participating Agency shall pay its share of the Operation and Maintenance Costs of all Metro System facilities. The Participating Agencies shall not pay for the Operation and Maintenance Costs of the Water Repurification System, which are City Water Utility PW Costs.
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4.4 Charges Based on Flow, Strength and Fixed Capacity: Exception.
4.4.1 Except as otherwise described in this Section 4.4, a Participating Agency’s share of the charges in this Section 4 shall be based on its proportionate Flow, Strength, and Fixed Capacities as set forth in Exhibit B, as described more fully in Section 5.
4.4.2 Notwithstanding Section 4.4.1, or any other provision of this Agreement, a Participating Agency’s share of PWP Phase 1 Capital Improvement Costs, PWP Phase 1 Repurified Water Revenue, and Pure Water Program Capital Expense Rate attributable to the Metro System as described in Sections 6.6 and 6.7 shall be assessed or credited based on the Parties’ proportionate share of the Pure Water Capital Melded Percentages set forth in Column 7 of Exhibit B. The City shall annually allocate the estimated and actual PWP Phase 1 Capital Improvement Costs and revenues which are attributable to the Metro System in proportion to each Party’s Pure Water Capital Melded Percentages as set forth in Column 7 of Exhibit B when estimating quarterly payments and conducting year-end adjustments.
4.4.3 Each Party recognizes that operation within respective Projected Future Strength and Flow Amounts is essential to the accurate allocation of costs and revenues under the Pure Water Program. In recognition of same, the Parties agree as follows:
4.4.3.1 Contract Capacity Transfers – Increases in Fixed Capacity Components. Beginning in the next fiscal year after the effective date of this Agreement, if a Party exceeds their Capacity Rights or any individual component of the Capacity Rights set forth in Exhibit B, by any one of the following triggers based upon data available at the completion of a fiscal year: (1) Three percent (3%) in a fiscal year for any two consecutive fiscal years, (2) One MGD in a fiscal year for any two consecutive fiscal years, or (3) The equivalent Strength of one MGD in a fiscal year for any two consecutive fiscal years; then, the City shall prepare an amendment to Exhibit B that reflects a Contract Capacity Transfer for that Party based on the available information about such Party’s exceedance(s) and the methodology set forth in Exhibit E.
After Phase 2 is completed, if, due to contract capacity transfers or reductions in capacity, the Pooled Capacity drops to less than two percent (2%) of the total Contract Capacity, a capacity study shall be initiated to evaluate existing facilities for new capacity. The City shall thereafter amend Exhibit B under the process set forth in Section 3.6 to reflect the new Contract Capacity for all Parties. Any changes to the methodology in Exhibit E shall be made pursuant to an Administrative Agreement subject to the Joint Administrative Approval Process described in Section 15.
4.4.3.2 Contract Capacity Transfers – Decreases in Fixed Capacity Components. Beginning in the next fiscal year after the effective date of this Agreement, if a Party can show through an independent report that its Monthly Average Daily Flow, annual average pounds per day of COD, annual average pounds per day of TSS, Incremental Peak Flow, or RSDP is projected to decrease ten percent (10%) or more below their Projected Future Strength and Flow Amounts using data from a minimum of three (3) consecutive prior fiscal years as support, then City shall prepare a proposed amendment to Exhibit B that reflects the new Projected Future Strength and Flow Amounts for all Parties based on such Party’s decrease and other relevant information using sound engineering principles and the guidelines set forth in Exhibit E. The City’s EXHIBIT A 29 July 7, 2026 Item 4
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proposed amendment shall be subject to the Two-Party Approval Process. If approved, the City shall thereafter amend Exhibit B using the process set forth in Section 3.6.
4.4.3.3 If Exhibit B is amended to update one or more Parties’ Projected Future Strength and Flow Amounts pursuant to Section 4.4.3.1 or 4.4.3.2, the change in Projected Future Strength and Flow Amounts shall be effective retroactively to the beginning of that fiscal year, and the City shall use the updated amounts in estimating quarterly payments and conducting year-end adjustments for Pure Water Program costs and revenues. Therefore, any Party that underpaid based on prior Exhibit B Fixed Capacity amounts (which were based on prior Projected Future Strength and Flow Amounts) shall pay the retroactive amount due in quarterly installments in its quarterly payments the following fiscal year; any Party that overpaid based on previous Exhibit B Fixed Capacity amounts shall receive a credit in quarterly installments in its quarterly payments the following fiscal year. Notwithstanding the preceding sentence, if the retroactive amount due exceeds 20% of a Party’s average annual Metro System payments for the previous four (4) fiscal years, such Party may elect to pay the retroactive amount due in its quarterly payments over the subsequent four (4) fiscal years, with interest, based on the most recent quarterly earnings rate of the City’s Treasurer’s Pooled Rate of Return; any Party that overpaid in an amount that exceeds 20% of their annual average Metro System payments for the previous four (4) fiscal years based shall receive a credit in its quarterly payments spread over the following four (4) fiscal years.
4.5 Monitoring Flow and Strength.
4.5.1 The City shall monitor Flow and Strength. The City shall own and operate as part of the Metro System monitoring devices which will measure the amount of Flow discharged into the Metro System, unless otherwise agreed by the City and a Participating Agency. These devices shall be installed at locations appropriate to accurately monitor Flow and Strength. The City may also monitor Flow and Strength at other locations as it deems appropriate. For all currently unmetered areas, unit counts or agreed upon flow estimates where unit counts are not appropriate shall be used. For adding or subtracting unit count areas, the average current Metro Flow per unit shall be used consistently for all Parties. These unmetered unit counts will be updated at least once every five (5) years. If the flow in an unmetered area is over 0.5 MGD at a specific connection point, then a meter shall be added for that area, if possible. Exhibit F provides the Flow formulas that shall be used to determine the payment obligation for each Party, or a grouping or subgrouping of Parties, as applicable. Exhibit F shall be distributed to all Parties with the budget estimates that are sent annually pursuant to Section 5.7.1. The City currently provides all Participating Agencies with access to their data from the Flow metering devices, including providing access to their raw data, and will continue to do so according to the Parties’ established practices on the Effective Date of this Agreement. Changes to Exhibit F may be made upon the City’s Administrative Approval.
4.5.2 In measuring Strength, the frequency and nature of the monitoring shall not be more stringent for the Participating Agencies than it is for the City. The frequency, nature, and locations of Strength measurements, as well as the procedures used to determine Strength, shall be reviewed at least once every five (5) years and if changes are appropriate or required, the City may change the Strength measurements subject to the Two-Party Approval process. When conducting sampling within a Participating Agency’s service area, the City shall follow appropriate safety and EXHIBIT A 30 July 7, 2026 Item 4
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security measures. The City and Participating Agencies will coordinate with the Participating Agency’s operations staff to ensure facilities are not negatively impacted by inspections.
4.5.3 The City shall report Strength data to the Participating Agencies at least quarterly.
4.5.4 The City shall notify the Metro JPA’s Executive Director and any directly affected Participating Agency within 24 hours of any unpermitted or unlawful discharge or release of effluent from the Metro System which may be reportable to the Regional Board, or any other regulatory agency, and which may result in civil or criminal penalties or administrative enforcement proceedings pursuant to Water Code sections 13261, et seq., section 13300, et seq., Government Code section 54740 et seq., or other provisions of law. Upon request from the Metro JPA or a Participating Agency, City shall provide the Metro JPA or affected Participating Agencies with copies of all non-privileged related correspondence to and from the Regional Board. The City shall endeavor to confer with Metro JPA staff during the report preparation process and before any report is submitted to a regulatory or enforcement agency.
5. FINANCE, BUDGETING, AND ACCOUNTING: SYSTEM OF CHARGES
5.1 Charges Authorized. The City agrees to implement, and the Parties agree to abide by a system of charges called Functional Allocated Billing (FAB). This system allows the City to equitably recover from all Participating Agencies their proportional share of the net Metro System Costs described in this section:
5.2 Functional Allocated Billing (FAB). The City shall annually determine the FAB rate based on the projected Metro System Costs (as defined below) for the forthcoming fiscal year, less all Metro System Revenues (as defined below). A detailed illustration of the FAB methodology using sample data is attached hereto as Exhibit J (the Sample FAB Calculation) to assist the Parties in understanding how the FAB methodology works. Exhibit J provides an illustration of the application of FAB to applicable parameters and the derivation of unit rates and resulting charges. The Parties agree that Exhibit J is intended to promote transparency and a common understanding of the implementation of FAB under this Agreement, but the Parties acknowledge that Exhibit J is illustrative only and shall not control over the terms of this Agreement or the actual calculation of annual FAB rates, which shall be determined in accordance with this Section 5.
5.2.1 Calculation of FAB Rates.
5.2.1.1 The City shall determine the unit FAB rates by allocating net costs (Metro System Costs less Metro System Revenues) between the fixed and measured variable parameters of Capacity Rights, such as Monthly Average Daily Flow, Incremental Peak Flow, COD, TSS, and RSDP as set forth in Exhibit B. These allocations are based on the approved Functional-Design Methodology analyses for sewer system components and estimated Operation and Maintenance (O&M) Costs allocated to each parameter.
5.2.1.2 Beginning one (1) year after substantial completion of the final project of Phase 1 of the Pure Water Program for which sewer revenue funds were used, the City shall have the FAB, which includes the Functional Design Methodology, professionally reviewed at least once every five (5) years.
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5.2.1.3 After conducting a professionally developed independent thirdparty report, the City may propose to change the FAB, including the Functional Design Methodology, to include any other parameter, or modify any term governed by this Section 5.2.1, by way of an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. However, the City may revise the FAB, including the Functional Design Methodology at any time to include any other measurement required by law after the effective date of this Agreement subject to the City’s Administrative Approval, in its sole discretion. City will notify all Participating Agencies of any such review or revision no later than sixty (60) days after City’s Administrative Approval. Once approved, the FAB resulting from any review or revision under this Section will become the current approved version until it is revised by a future professional independent third-party study or a change in law.
5.2.1.4 Each of the parameters will have a fixed and variable O&M charge between 0% and 100%. Fixed Capacity Charges will be based on the Contract Capacity in Exhibit B. Variable charges will be based on measured parameters such as Metered Flow, Strength and RSDP.
5.2.1.5 Costs for capital improvements, capital replacement, and rehabilitation costs including financing shall be based on the approved Functional-Design Methodology and the Contract Capacity in Exhibit B.
5.2.1.6 The net cost allocated to each of the parameters shall be divided by the total Metro System quantity for that parameter to determine the unit rates for each parameter.
These unit rates shall apply uniformly to all Parties.
5.3 Metro System Costs. The following shall at a minimum be considered Metro System Costs for purposes of calculating the annual FAB rate:
5.3.1 Except as provided in Section 5.4 (Excluded Costs), the annual Operation and Maintenance Costs and annual costs associated with administration, replacement, annual debt service costs and other periodic financing costs and charges, capital improvement, insurance premiums, claims payments and claims administration costs of the Metro System, including projected overhead, shall be calculated using generally accepted accounting practices to reflect the costs of the Metro System.
5.3.2 Fines or penalties imposed on the City as a result of the operation of the Metro System, unless the fine/penalty is allocated to the City or a Participating Agency as provided in Section 2.5.5.
5.4 Excluded Costs. The following items shall not be considered Metro System Costs for purposes of calculating the annual FAB rate:
5.4.1 Costs related to the City of San Diego’s municipal sewer, water (including City Water Utility PWP Costs), and/or stormwater systems as determined by City’s reasonable calculations consistent with sound engineering and best management practices.; EXHIBIT A 32 July 7, 2026 Item 4
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5.4.2 Right-of-way charges for the use of public streets of the City or any Participating Agency. The City and the Participating Agencies agree not to impose a right-of- way charge for the use of its public rights-of-way for Metro System purposes;
5.4.3 Capital Improvement Costs or Operations and Maintenance Costs of any non-Metro System facility not included in Exhibit A, including, but not limited to, any costs associated with the ECAWP Project;
5.4.4 Those costs otherwise identified as excluded costs in Section 6.3.
5.5 Metro System Revenues and Allocations. The following revenues shall be at a minimum considered Metro System Revenues for purposes of determining the annual FAB rate:
5.5.1 Any grant or loan receipts or any other receipts that are attributable to the Metro System or Metro System components of the Pure Water Program, including, but not limited to, all compensation or receipts from the sale, lease, or other conveyance or transfer of any asset of the Metro System or Metro System components of the Pure Water Program. Any such receipts attributable to the Metro System components of the Pure Water Program shall be allocated among the City and the Participating Agencies in the proportions set forth in Exhibit B Fixed Capacity amounts.
5.5.2 All compensation or receipts from the sale or other conveyance or transfer of any Metro System byproducts, including, but not limited to, gas, electrical energy, sludge products, and Recycled Water produced at the NCWRP and SBWRP and the future Central Area Plant.
5.5.3 Payments by the City’s Water Utility for the Capital Expense Rate, as calculated under provisions in Section 6.7. These proceeds shall be allocated among the City and Participating Agencies in the proportions set forth in Exhibit B Fixed Capacity amounts.
5.5.4 Those portions of Repurified Water Revenue attributable to the Metro System, as calculated under provisions in Section 6.6.3. These revenues shall be allocated among the City and Participating Agencies in the proportions set forth in Exhibit B Fixed Capacity amounts.
5.5.5 Any other non-operating revenues, including, but not limited to interest income included in the income credit portion of the annual audit.
5.6 Excluded Revenue. The following revenues shall be excluded from Metro System Revenues for purposes of determining the annual FAB rate:
5.6.1 Proceeds from the issuance of debt for Metro System projects.
5.7 Estimate and Billing Schedule and Year End Adjustment.
5.7.1 The City shall estimate the FAB rates on an annual basis prior to January 15 and provide budget estimates for the upcoming fiscal year to all Parties. The City shall quantify the FAB rates by estimating the quantity of Flow, Strength, and Fixed Capacity Charges for each EXHIBIT A 33 July 7, 2026 Item 4
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Party, based on that Party’s Metered Flow for the past year and the cumulative data of sampling for Strength constituents such as COD and TSS over the preceding five years and Fixed Capacities set forth in Exhibit B. If the cumulative five-year Strength data is no longer indicative of discharge from a Party, and a Contract Capacity Transfer has been approved pursuant to Sections 4.4.3.1,
4.4.3.2, or 3.2, then the City may eliminate the previous higher readings subject to the City’s Administrative Approval.
5.7.2 Prior to March 1 of each year the City will provide a mid-year review of the current year’s Metro System Capital Improvement Costs and Operations and Maintenance Costs and offsetting non-operating revenues such as grant or loan proceeds, including fiscal year-end projections and provide such reviews to the Participating Agencies.
5.7.3 The City shall determine the volume of MBC Return on an annual basis and for billing purposes only. The costs of treating MBC Return shall be allocated to the Parties in proportion to their Metered Flow and Strength. If a Party’s Monthly Average Daily Flow plus MBC Return exceeds their Contract Capacity set forth in Exhibit B, it shall not be treated as an exceedance pursuant to Section 4.4.3.1.
5.7.4 The City shall bill the Participating Agencies quarterly, invoicing on August 1, November 1, February 1 and May 1. Each bill shall be paid within thirty (30) days of mailing. Quarterly payments will consist of the total estimated cost for each Participating Agency, based on their estimated Flow, Strength, and Fixed Capacity Charges, divided by four.
5.7.5 At the end of each fiscal year, the City shall determine the actual Metro System Costs and the actual Metered Flow as well as the cumulative Strength data for the City and each of the Participating Agencies. The City shall make any necessary adjustments to the unit rates for Flow and Strength such as COD, TSS and Fixed Capacity Charges based on actual costs for the year as determined through the annual audit process in Section 5.8.2 of this Agreement. The City shall then recalculate the FAB rate for the year using actual audited costs for the year, actual Metered Flow, Residuals, MBC Return, cumulative Strength factors, and Fixed Capacity Charges for the City and for each Participating Agency. The City shall credit any future charges or bill for any additional amounts due against the quarter after the prior year costs have been audited.
5.8 Financial Statements.
5.8.1 The City shall keep records and accounts of all costs and expenses relating to conveyance, treatment, disposal, and reuse of wastewater, and production of Repurified Water, and the acquisition, planning, design, construction, administration, monitoring, operation and maintenance of the Metro System and Water Repurification System, and any grants, loans, or other revenues received therefor. The City shall keep such records and accounts for at least four (4) years after the completed audit, or for any longer period required by law or outside funding sources.
5.8.2 Annual Audit. Said records and accounts shall be subject to reasonable inspection by any authorized representative of any Participating Agency at its expense. Further, said accounts and records shall be audited annually by an independent certified public accounting firm appointed by the City. A copy of said report shall be available to any Participating Agency.
As part of said audit, the actual amount of City Water Utility’s PW Costs, Pure Water Program EXHIBIT A 34 July 7, 2026 Item 4
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costs attributable to the Metro System, Repurified Water Revenue, and the Capital Expense Rate shall be determined and audited by the City’s external auditors and Participating Agency representatives, and a cumulative and annual summary of such amounts shall be included as a footnote or attached to the audit of the Metro System. Cost summaries shall include separate lines for Capital Improvement Costs and Operation and Maintenance Costs.
5.8.3 The City shall make a good faith effort to complete the annual audit, and any related adjustments under this Agreement as described in Section 5.8.2, by the end of the following fiscal year.
5.9 Debt Financing. The City retains the sole right to determine the timing and amount of debt financing required to provide Metro System Facilities. The annual debt service plus inprogress Capital Improvement Costs to maintain capacity in and of the Metro System shall be allocated to the Participating Agencies consistent with the Exhibit B Contract Capacity allocations effective on the date the debt is issued. If a Participating Agency wishes to prepay Capital Improvement Costs, and the City is able to accommodate such a request, then a Participating Agency may prepay their proportional share of Capital Improvement Projects. If a Participating Agency wishes to withdraw or reduce their Flows and/or Strengths from the Metro System per Section 2.3.3 of this Agreement, such agency will remain responsible for its pro-rata share of all outstanding debt incurred at the time the debt was issued until it is satisfied, irrespective of withdrawal, reduction in Flows and/or Strengths, or Agreement expiration. If the City refunds debt, it shall allocate such refunds consistent with the Exhibit B Contract Capacity allocations effective on the date the debt was issued.
5.10 Allocation of Operating Reserves and Debt Service Coverage. The Parties shall continue to comply with the protocol set forth in Exhibit C, Administrative Protocol on Allocation of Operating Reserves and Debt Service Coverage to Participating Agencies, which exhibit may be amended from time to time consistent with Section 5.11.
5.11 Amending the System of Charges. Except as otherwise provided in Section 5.2.1.3, the Parties may amend any provision in this Section 5 regarding the Finance, Budgeting, and Accounting System of Charges in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15.
6. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 1
6.1 North City Water Reclamation Plant Modification. As part of Phase 1 of the Pure Water Program, the City intends to modify the North City Water Reclamation Plant (a Metro System facility) and expand its capacity to 52 MGD. In addition, the City intends to construct the North City Pure Water Facility on a nearby site to produce Repurified Water. This Section sets forth the costs and revenues associated with the Pure Water Program attributable to the Metro System. Exhibit A includes current constructed Metro System facilities and existing and proposed future Phase 1 facilities.
6.2 New, Expanded or Modified Metro System Facilities. Each new, expanded, or modified Metro System facility, which is part of the Pure Water Program, and is used in relation EXHIBIT A 35 July 7, 2026 Item 4
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to the production of Repurified Water (in addition to the modification and expansion of the North City Water Reclamation Plant) shall be governed by this Section.
6.3 Costs Excluded from Metro System Costs – Phase 1. All of the following Pure Water Program costs, including Capital Improvement Costs, Operation and Maintenance Costs, and other related costs (including administration, insurance, claims, and overhead) shall be excluded from Metro System Costs for purposes of calculating the annual FAB rate.
6.3.1 General Exclusions:
6.3.1.1 Costs of the Water Repurification System and any Metro System facilities to the extent constructed, modified, expanded, or used for the purpose of treating wastewater beyond secondary treatment (ocean discharge standard under current law). This shall include costs for preliminary treatment, primary treatment, and secondary treatment to the extent such costs are higher than they would otherwise be due to the production of Repurified Water.
6.3.1.2 Costs for fail-safe disposal, if necessary, for design capacity for Repurified Water, including, but not limited to, any costs associated with the reservation of capacity at the Point Loma Wastewater Treatment Plant.
6.3.1.3 Costs for the demolition or replacement of existing Metro System facilities with similar facilities for the purpose of making space available for Water Repurification System facilities. Such costs may consider the current asset value or market value of the existing Metro System facility.
6.3.2 Cost Exclusions Specific to North City Water Reclamation Plant Improvements:
6.3.2.1 Costs for increased aeration tank volume to the extent the new volume exceeds the amount necessary to provide 52 MGD capacity. Determination of sizing to provide 52 MGD capacity shall be based on the current tank volume necessary to provide 30 MGD capacity.
6.3.2.2 Costs for the methanol feed system.
6.3.2.3 Costs for RSDP disposal, including, but not limited to, pump stations, pipelines, retreatment, ocean outfall, and monitoring.
6.3.2.4 Costs for the use of existing tertiary water filters for Repurified Water purposes. Such costs may consider the depreciated value of such filters or use such other appropriate valuation methods as agreed by the City and authorized representatives of the Metro JPA. Costs under this section shall be reimbursed or credited by City’s Water Utility to the Metro System.
6.4 North City Water Reclamation Plant Improvement Costs Included as Metro System Costs. Notwithstanding the above exclusions, the City and the Participating Agencies have specifically agreed that the following Capital Improvement Costs and Operation and Maintenance Costs related to North City Water Reclamation Plant improvements shall be included as Metro EXHIBIT A 36 July 7, 2026 Item 4
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System Costs for purposes of calculating the annual FAB rate (and therefore not qualify as City Water Utility PW Costs):
6.4.1 Costs for chemically enhanced primary treatment for up to 52 MGD capacity.
6.4.2 Costs for primary effluent equalization for up to 52 MGD capacity.
6.4.3 Costs for increased volume of aeration tanks that will provide up to, but not exceeding, 52 MGD capacity.
6.4.4 Costs to add secondary clarifier tanks sufficient for up to 52 MGD capacity.
6.4.5 Costs for wastewater conveyance facilities to provide wastewater for replacement of Centrate flows that cannot be treated at the North City Water Reclamation Plant due to the production of Repurified Water.
6.4.6 Costs for treatment and conveyance of all MBC Return (micro-filtration and tertiary backwash) based on Flow, COD, and TSS.
6.5 Reallocation of PWP Costs incurred since FY 2014.
6.5.1 The allocation of Pure Water Program costs, retroactive to June 30, 2014, will be calculated the year the Agreement goes into effect, will be completed no less than two fiscal years following the production of 30 MGD by Phase 1 of the Pure Water Program.
6.5.1.1 All the O&M task orders, or costs that cannot be directly assigned to a PWP Phase 1 capital improvement project such as program management, environmental documents, etc., will be reallocated by the final water/wastewater cost split, and will include interest accruing since June 2014 at the interest rate earned by the City of San Diego for each applicable fiscal year as shown by the sample interest calculation included in Exhibit G, Sample of Interest Calculation. This postpones the reconciliation of costs until the substantial completion of all construction projects for Phase 1 (City Water Utility PW Costs and Metro). This reconciliation will be performed during the audit of the fiscal year in which substantial completion of all projects occurs.
6.5.1.2 All Phase 1 PWP CIP projects were bid and awarded by October 2022 which is FY2023. All shared Phase 1 CIP projects will be reallocated to the actual construction cost split once the project is awarded, and the cost loaded CPM is completed and negotiated between the City and the Participating Agencies during the FY2023 audit. All CIP soft costs incurred since 2014 will be reallocated like the O&M task orders during the audit of the year of substantial completion of the actual Phase 1 CIP projects. If interest is owed to the Metro System for soft costs starting in FY 2014, such interest shall be considered Metro System Revenues consistent with Section 5.5.5.
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6.6 Revenue Sharing for Repurified Water.
6.6.1 Background. Initially, the Parties anticipate that the cost per acre foot associated with the production of Repurified Water will be more expensive than the cost per acre foot of untreated imported water. However, it is anticipated that Repurified Water produced under Phase 1 will be less expensive than untreated imported water sometime in the future. Once Repurified Water produced under Phase 1 becomes less expensive than the cost of untreated imported water, the Parties agree that there will be revenue from the Pure Water Program.
6.6.2 Calculation. Revenue sharing shall occur in each fiscal year during which the annual cost per acre foot associated with the production of Repurified Water is less than the cost of untreated water per acre foot from the San Diego County Water Authority (“CWA”). The annual cost difference shall be known as “Repurified Water Revenue.” Repurified Water Revenue shall be determined as follows:
Annual cost per acre foot of CWA untreated water purchased by the City for delivery at Miramar Reservoir (which shall be determined based on the total costs for water actually billed to the City by CWA for water delivered at Miramar Reservoir in a fiscal year, divided by the number of acre-feet of CWA water delivered at Miramar Reservoir that year)
less
Annual cost per acre-foot of City Water Utility PW Costs (which shall be determined based on total annual City Water Utility PW Costs divided by the number of acre-feet of Repurified Water actually produced in that year) the result of which is multiplied by
The number of acre feet of Repurified Water produced by Pure Water Program facilities during the applicable fiscal year.
Exhibit H, Summary of Billings from County Water Authority Showing Costs for Untreated Water, is a summary of the most recent CWA rate structure and cost allocations to the City of San Diego for untreated water. The Parties agree that Exhibit H shall be referred to by the Parties in the future in determining how costs for water delivered at Miramar Reservoir are calculated. If no untreated water is delivered at Miramar Reservoir in a given year, then the closest point of delivery of untreated water to the City shall be used. The City shall annually update Exhibit H to reflect the most recent CWA rate structure and cost allocations to the City of San Diego.
The City shall estimate whether there will be Repurified Water Revenue in the upcoming fiscal year prior to January 15 of each year, and these amounts shall be incorporated into the budget estimates for the upcoming fiscal year to all Parties.
6.6.3 Revenue Sharing. Repurified Water Revenue shall initially be shared between the City’s Water Utility and the Metro System based on the relative actual Capital Improvement Costs for the Pure Water Program contributed by City’s Water Utility and the Metro EXHIBIT A 38 July 7, 2026 Item 4
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System. Such Capital Improvement Cost contributions are currently estimated as 62% City’s Water Utility and 38% Metro System. The Metro System’s portion of the Repurified Water Revenue shall be applied to debt attributable to the Metro System first, until the debt attributable to the Metro System is fully paid.
Following full payment of debt attributable to the Metro System, Repurified Water Revenue shall be shared based on the relative actual Operation and Maintenance Costs for Pure Water Program facilities contributed by City’s Water Utility and the Metro System, calculated annually. Such Operation and Maintenance Costs are currently estimated as 76% City’s Water Utility and 24% Metro System on an annual basis.
In all instances referred to in this Section 6.6.3, the Metro System portion of the Repurified Water Revenue shall be allocated among the City and the Participating Agencies consistent with Section 4.4.2.
6.6.4 Year-End Adjustment. At the end of each fiscal year during which there is Repurified Water Revenue, the City shall determine the actual cost per acre foot of CWA untreated water purchased by the City, the actual cost per acre foot of City Water Utility PW Costs, and the actual amount of Repurified Water produced at Pure Water Program facilities.
Based on the actual cost and production information, the City will recalculate the Repurified Water Revenue for the prior fiscal year. The City will credit any future charges or bill for any additional amounts due the quarter after the prior year costs have been audited.
6.6.5 Change in Potable Reuse Method. The Parties acknowledge that the Pure Water Program Phase 1 will initially use indirect potable reuse surface water augmentation. The use of CWA untreated water costs in calculating Repurified Water Revenue is intended to provide an appropriate point of comparison to costs for producing Repurified Water that will be introduced into surface water. The Parties agree that if the City desires to implement direct potable reuse (in which Repurified Water would be introduced directly into a water supply pipeline or facility), the Parties shall meet and negotiate in good faith regarding an amendment to this Section 6.6, to appropriately update the formula for Repurified Water Revenue, which form of amendment shall occur via an Administrative Agreement and shall be subject to the Joint Administrative Approval Process set forth in Section 15.
6.7 Capital Expense Rate.
6.7.1 Background. The Point Loma Wastewater Treatment Plant operates under a National Pollutant Discharge Elimination System (“NPDES”) permit modified under section 301(h) & (j)(5) of the Clean Water Act. If such modified permit were ever revoked or not renewed, the Parties agree that, under current law, the City would have an obligation to upgrade the PLWTP to secondary treatment. The Parties further agree that $1.8 billion is a fair and comprehensive estimation of the costs that could be incurred by the Metro System to meet the legal requirements related to the Metro System under current law. The estimate of $1.8 billion is based on the net present value of the capital cost to develop 180 MGD of secondary treatment at PLWTP as of November 15, 2018.
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Therefore, the Parties agree that $1.8 billion represents the maximum amount of Capital Improvement Costs that the Metro System should be obligated to contribute to the Pure Water Program, the purpose of which is not solely the disposal of wastewater, but also the production of Repurified Water. The Parties agree that this $1.8 billion maximum contribution should apply whether or not the PLWTP is actually upgraded to secondary treatment to meet legal requirements in the future because, as of the date of the Agreement, the Parties have the option of upgrading the PLWTP to full secondary treatment for the cost of approximately $1.8 billion.
In light of the above, the Parties have agreed that if Metro System costs related to the Pure Water Program exceed the $1.8 billion, City’s Water Utility will pay a charge for each acre foot of secondary treated effluent produced by Metro System facilities and used for the production of Repurified Water.
6.7.2 Capital Expense Rate. Under the circumstances described in this Section 6.7, City’s Water Utility shall pay a charge (“Capital Expense Rate”) for each acre-foot of secondary treated effluent produced by Metro System facilities and used for the production of Repurified Water. The Capital Expense Rate costs or revenues attributable to the Metro System shall be assessed or credited consistent with Section 4.4.2. City’s Water Utility shall pay the Capital Expense Rate if the following costs alone, or in combination, exceed $1.8 billion (which amount shall be adjusted for inflation):
6.7.2.1 The sum of all Capital Improvement Costs and associated debt attributable to the Metro System components of the Pure Water Program under this Section 6.7.2; and/or
6.7.2.2 The sum of all Capital Improvement Costs and associated debt for the full or partial upgrading of the PLWTP to secondary treatment.
Notwithstanding the above, the Capital Expense Rate shall not apply if the PLWTP is actually upgraded to secondary treatment (or beyond) due to: (a) a change in federal or state statutory law making it necessary to upgrade the PLWTP to comply with such new discharge standard; or (b) a final decision by a state or federal court or a federal administrative agency of competent jurisdiction that an NPDES permit modified under section 301(h) & G)(5) of the Clean Water Act is thereby revoked or denied renewal due to a finding that the discharge from the PLWTP violates anti-degradation rules or regulations promulgated under section 403 of the Clean Water Act.
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6.7.3 Calculation of Capital Expense Rate. The amount per acre-foot of the Capital Expense Rate shall be determined as follows:
The sum of all Capital Improvement Costs and associated debt attributable to (i) the Metro System components of the Pure Water Program under this Section 6 and (ii) upgrading of the PLWTP to secondary treatment (if any) less
$1.8 billion, as adjusted for inflation each July 1 (starting on July 1, 2019) to reflect the annual percentage change in the Engineering News Records – Los Angeles construction cost index
the result of which is multiplied by
1.42 (which estimates the total interest on a 30-year State Revolving Fund loan with an interest rate of 2.5%)
the result of which is divided by
The total number of acre feet per year of secondary treated effluent that is expected to be produced by Metro System facilities for the production of Repurified Water over a period of thirty (30) years.
The City shall estimate whether the Capital Expense Rate shall apply to the upcoming fiscal year (and its amount) prior to January 15 of each year, and the estimated amount of the Capital Expense Rate shall be effective on July 1 of the upcoming fiscal year.
For purposes of this Section 6.7.3, Capital Improvement Costs and associated debt shall include such costs and revenue incurred by the Metro System prior to the effective date of the Agreement.
6.7.4 Year-End Adjustment. At the end of each fiscal year during which the Capital Expense Rate applies, the City shall determine the actual Capital Improvement Costs and associated debt attributable to the Metro System components of the Pure Water Program under this Section 6 and any upgrading of the PLWTP to secondary treatment, and the actual amount of secondary treated effluent produced by Metro System facilities and used for the production of Repurified Water.
Based on the actual cost, interest, and effluent information, the City will recalculate the Capital Expense Rate for the prior fiscal year. The City will credit any future charges or bill for any additional amounts due the quarter after the prior year costs have been audited.
6.7.5 Duration; Expiration. The Capital Expense Rate shall continue until the cost difference between (a) the actual sum of Pure Water Program Capital Improvement Costs and associated debt attributable to the Metro System under Section 6.7 and/or the costs to upgrade the PLWTP and (b) $1.8 billion (as adjusted for inflation), has been fully paid, or the Agreement expires, whichever is sooner. Notwithstanding, it is the express intent and desire of the City and the Participating Agencies that if the Agreement expires before the cost difference has been paid EXHIBIT A 41 July 7, 2026 Item 4
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through the Capital Expense Rate, that the Capital Expense Rate continue in any extension of this Agreement negotiated by the Parties pursuant to Section 14.2 until the cost difference has been fully paid.
6.8 Amending Pure Water Program Cost Allocation and Revenues – Phase 1. Except as otherwise provided in Section 6.6.2, the Parties may amend any provision in this Section 6 regarding the Finance, Budgeting, and Accounting for the Pure Water Program Cost Allocation and Revenues for Phase 1 in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15.
7. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 2
7.1 Pure Water Program – Phase 2. The Second Phase of the Pure Water Program (“Phase 2”) shall create up to an additional 53 MGD of Repurified Water at Phase 2 facilities. The Parties agree to incorporate all terms relating to Phase 2 into this Agreement through an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15, subject to the requirements set forth in this Section 7 below.
7.2 Costs Excluded As Metro System Costs.
Costs Excluded from Metro System Costs for Phase 2 shall be identified in an Administrative Agreement subject to the Joint Administrative Approval Process and approvals set forth in Section 15. However, the Administrative Agreement must reflect that all of the following PWP Phase 2 costs, including Capital Improvement Costs, Operation and Maintenance Costs, and other related costs (including administration, insurance, claims, and overhead) shall be excluded from Metro System Costs for the purposes of calculating the annual Phase 2 FAB rate, and shall be City Water Utility PW Costs:
7.2.1 Costs of the Phase 2 Water Repurification System and any Metro System facilities to the extent constructed, modified, expanded, or used for the purpose of treating water beyond secondary treatment (ocean discharge standard under current law). This shall include costs for preliminary treatment, primary treatment, and secondary treatment to the extent such costs are higher than they would otherwise be due to the production of Phase 2 Repurified Water.
7.2.2 Costs for fail-safe disposal, if necessary, for design capacity for Phase 2 Repurified Water, including, but not limited to, any costs associated with the reservation of capacity at the Point Loma Wastewater Treatment Plant.
7.2.3 Costs for the demolition or replacement of existing Metro System facilities with similar facilities for the purpose of making space available for Phase 2 Water Repurification System facilities. Such costs may take into account the current asset value or market value of the existing Metro System facility.
7.2.4 Costs for the Phase 2 methanol feed system.
7.2.5 Costs for Phase 2 RSDP disposal including, but not limited to, pump stations, pipelines, retreatment, ocean outfall, and monitoring.
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7.2.6 50% of the costs for the MBR Tanks and system for Phase 2.
7.2.7 All membrane integrity monitoring systems for Phase 2.
7.2.8 All Phase 2 systems downstream of MBR’s.
7.3 Revenue Sharing for Repurified Water – Phase 2. Terms regarding revenue sharing for Repurified Water for Phase 2 shall be identified in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. However, this Administrative Agreement must reflect terms related to Phase 2 revenue sharing for Repurified Water that conceptually mimic those terms set forth in Section 6.6. The Metro System portion of the Repurified Water Revenue for Phase 2 shall be allocated among the City and the Participating Agencies consistent with Section 4.4.2, as may be amended or updated to account for changes in PWP Phase 2.
7.4 Capital Expense Rate – Phase 2. Terms regarding the Capital Expense Rate for Phase 2 shall be identified in an Administrative Agreement subject to the Joint Administrative Approval Process and approvals set forth in Section 15. However, this Administrative Agreement must reflect terms that conceptually mimic the terms in Section 6.7, reflecting a continuation of the Capital Expense Rate through Phase 2 up until the PWP achieves up to 83 MGD of Repurified Water, taking into account production of water suitable for potable reuse occurring at all treatment processes for wastewater upstream from and at the PLWTP. The Pure Water Program Capital Expense Rate costs or revenues attributable to the Metro System shall be assessed or credited consistently with Section 4.4.2, as may be amended or updated to account for changes in PWP Phase 2.
8. FUTURE NEGOTIATIONS AND COOPERATION
This Agreement specifically contemplates Phase 1 and Phase 2 of the Pure Water Program, which consists of new, expanded, or modified Metro System and Water Repurification System facilities projected to produce up to 83 million gallons per day of Repurified Water. The Parties intend to meet and negotiate in good faith regarding the referenced Administrative Agreements identified in this Agreement. All items outside the scope of the Joint Administrative Approval Process shall be negotiated by the Parties through the amendment processes described in Section 16.3, if necessary.
9. THE METRO COMMISSION
9.1 Establishment and Membership. The 1998 Agreement created and established (and the ARA reestablished) the Metro Commission as a commission consisting of one representative from each Participating Agency. On October 25, 2000, the Participating Agencies entered into a Joint Exercise of Power Agreement which created a separate public entity, the Metro Wastewater Joint Powers Authority (“Metro JPA”), for the purpose, among others, of taking responsibility, actions, and making decisions pertaining to the 1998 Agreement on behalf of the Participating Agencies. The Metro Commission and the Metro JPA are and shall hereinafter be treated as one and the same entity for all intents and purposes under this Agreement, including for the purpose of accepting and executing the responsibilities delegated to the Metro JPA in this Agreement. Each Participating Agency shall have the right to appoint a representative of its choice EXHIBIT A 43 July 7, 2026 Item 4
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to the Metro Commission/Metro JPA, and the Participating Agency’s appointee to the Metro Commission shall also serve as that Participating Agency’s representative on the Metro JPA Board of Directors. If a Participating Agency is a dependent district whose governing body is that of another independent public agency, that Participating Agency shall be represented on the Metro Commission/Metro JPA by a representative appointed by the governing body which shall have no more than one representative no matter how many Participating Agencies it governs. Each member has one vote in any matter considered by the Metro Commission/Metro JPA. The Metro Commission/Metro JPA shall establish its own meeting schedule and rules of conduct. The City may participate in the Metro Commission on an ex officio, non-voting basis. To the extent this Agreement expands or amends the powers or purposes set forth in the Metro JPA Joint Exercise of Powers Agreement, the Participating Agencies expressly agree to such expansion or amendment consistent with the terms of this Agreement.
9.2 Advisory Responsibilities of Metro JPA.
9.2.1 The Metro JPA shall act as an advisory body to the Mayor and City Council on policy issues and matters affecting and relating to the Metro System and shall be included in the City’s list of boards and commissions on the City’s website. The City shall present the position of the majority of the Metro JPA to the City’s governing body in written staff reports. The Metro JPA may prepare and submit materials in advance and may appear at any City hearings on Metro System matters and present its position to the governing body of the City.
9.2.2 The Metro JPA may advise the City of its position on any issue relevant to the Metro System.
9.3 Delegation of Decision-Making Authority of the Metro JPA. The Participating Agencies hereby delegate to the Metro JPA the authority to take certain actions pursuant to the approval processes provided in this Agreement, as permitted by law, including but not limited to Government Code 6506. The Participating Agencies agree that the Metro JPA has delegated authority to approve Administrative Agreements on behalf of each Participating Agency pursuant to the process set forth in Section 15. The Participating Agencies agree and acknowledge that the Metro JPA has authority to bind each Participating Agency to Administrative Agreements through the Joint Administrative Approval Process. All Participating Agencies agree to promptly execute Administrative Agreements after approval by the Metro JPA. By signing this Agreement, each Participating Agency is expressly preapproving such actions.
9.4 Standing. If a dispute arises among the Parties relating to or arising from a Party’s obligation under this Agreement or an associated Administrative Agreement, the Metro JPA shall have standing to enforce the terms of this Agreement against the City on behalf of two or more Participating Agencies if a majority of the Metro JPA votes to take action relating to this Agreement on behalf of two or more Participating Agencies.
10. DISPUTE RESOLUTION
This Section governs all disputes arising out of this Agreement and any associated Administrative Agreements.
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10.1 Mandatory Non-Binding Mediation. If a dispute arises among the Parties relating to or arising from a Party’s obligations under this Agreement or an associated Administrative Agreement that cannot be resolved through informal discussions and meetings, the Parties involved in the dispute shall first endeavor to settle the dispute in an amicable manner, using mandatory non-binding mediation under the rules of JAMS, AAA, or any other neutral organization agreed upon by the Parties before having recourse in a court of law. Mediation shall be commenced by sending a Notice of Demand for Mediation to the other Party or Parties to the dispute. A copy of the notice shall be sent to the City, all other Participating Agencies, and the Metro JPA.
10.2 Selection of Mediator. A single mediator that is acceptable to the Parties involved in the dispute shall be used to mediate. The mediator will be knowledgeable in the subject matter of this Agreement, if possible, and chosen from lists furnished by JAMS, AAA, or any other agreed upon mediator.
10.3 Mediation Expenses. The expenses of witnesses for either side shall be paid by the Party producing such witnesses. All mediation costs, including required travel and other expenses of the mediator, and the cost of any expert advice produced at the direct request of the mediator, shall be Metro System costs.
10.4 Conduct of Mediation. Mediation hearings will be conducted in an informal manner. Discovery shall not be allowed. The discussions, statements, writings and admissions and any offers to compromise during the proceedings will be confidential to the proceedings (pursuant to California Evidence Code sections 1115 - 1128 and 1152) and will not be used for any other purpose unless otherwise agreed by the Parties in writing. The Parties may agree to exchange any information they deem necessary. The Parties involved in the dispute shall have representatives attend the mediation who are authorized to settle the dispute, though a recommendation of settlement may be subject to the approval of each agency’s boards or legislative bodies. Either Party may have attorneys, witnesses or experts present.
10.5 Mediation Results. Any resultant agreements from mediation shall be documented in writing. The results of the mediation shall not be final or binding unless otherwise agreed to in writing by the Parties. Mediators shall not be subject to any subpoena or liability and their actions shall not be subject to discovery.
10.6 Performance Required During Dispute. Nothing in this Section shall relieve the City and the Participating Agencies from performing their obligations under this Agreement. The City and the Participating Agencies shall be required to comply with this Agreement, including the performance of all disputed activity and disputed payments, pending the resolution of any dispute under this Agreement.
11. INSURANCE
11.1 City Shall Maintain All Required Insurance.
11.1.1 Throughout the term of this Agreement the City shall procure and maintain in effect liability insurance covering Metro System assets and operations in the same manner, and to the same extent, as the City insures similar assets and operations of the City. Such insurance EXHIBIT A 45 July 7, 2026 Item 4
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may be provided through separate policies for the Metro System, or by consolidating the Metro System with other City assets and operations for insurance purposes. If the Metro System is insured separately, policy limits, deductibles, and self-insured retentions shall be equivalent to what the City procures for other similar City assets and operations. The City shall maintain all insurance required by law, including workers’ compensation insurance, and may self-insure for certain losses when allowed by law. The proportionate cost of insurance for the Metro System shall be included in the computation of the FAB.
11.1.2 If the Metro System is insured separately, any policy or policies of liability insurance carried by the City for the Metro System shall name the Participating Agencies as additional insureds with evidence of same supplied to each upon request.
11.1.3 Upon request by the Metro JPA or a Participating Agency, the City shall promptly provide written coverage and policy information, including, but not limited to, the scope of coverage, policy limits, deductibles, and self-insured retentions, including information on any claims made against the policies and remaining limits and deductibles.
11.2 Substantially Equivalent Coverage. In the event of a transfer of the Metro System to a nonpublic entity pursuant to Section 2.1, coverage substantially equivalent to all the above provisions shall be maintained by any successor in interest.
12. INTERRUPTION OF SERVICE
Should the Metro System services to the Participating Agencies be interrupted as a result of a major disaster, by operation of federal or state law, or other causes beyond the City’s control, the Participating Agencies shall continue all payments required under this Agreement during the period of interruption.
13. NOTICES REQUIRED UNDER AGREEMENT
The City and each Participating Agency shall give notice when required by this Agreement.
All notices required by this Agreement must be in writing and must be sent via email and either served personally or mailed via first class U.S. mail. The notices shall be sent to the officer listed for each Party, at the address and email address listed for each Party in Exhibit D, Notice Listing, in accordance with this Section. If a Party wishes to change the officer and/or address to which notices are given, the Party shall notify all other Parties in accordance with this Section. Upon such notice, the City shall amend Exhibit D to reflect the changes. The amendment shall be made within sixty (60) days after receipt of the Party’s notice regarding the change in officer and/or address.
The City shall keep an updated version of Exhibit D, notated with the most recent amendment date, on file with the City Public Utilities Department. The City shall provide a copy of the amended Exhibit D to all Parties by no later than sixty (60) days after amending Exhibit D.
14. EFFECTIVE DATE AND EXPIRATION
14.1 Effective Date. Once all Parties have executed this Agreement, this Agreement shall be considered effective on July 1, 2026 irrespective of the date on which the last executing party signs the Agreement.
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14.2 Expiration. Subject to the rights and obligations set forth in Section 14.3, unless amended, replaced, or terminated earlier by mutual consent of all the Parties, this Agreement shall expire on June 30, 2065. This Agreement is subject to extension by agreement of the Parties. The Parties shall commence discussions on an agreement to provide wastewater treatment services beyond the year 2065 on or before December 31, 2055, or at such time, if any, that the PLWTP is required to be upgraded to secondary treatment. The Parties may create, amend or terminate any associated Administrative Agreements addressing implementation of this Agreement, as provided in this Agreement.
14.3 Contract Capacity Rights Survive Expiration. The Participating Agencies’ Contract Capacity rights and rights to obtain wastewater treatment services from the facilities referred to in, or constructed pursuant to this Agreement shall survive the expiration of the Agreement. Provided, however, for any Participating Agency to exercise such rights, the Participating Agency shall comply with all the following requirements: (a) provide at least six months’ written notice prior to the expiration of this Agreement; (b) upon expiration of this Agreement, pay their proportional share of Metro System Costs according to the billing methodologies set forth in this Agreement in order to maintain their right(s) to such wastewater treatment services; and (c) agree to recalculate and pay proportional share of future Metro System Costs based on the City’s and all remaining Participating Agencies’ proportionate shares. In the event this Agreement expires and one or more Participating Agency(ies) continue to pay their proportional share of all Metro System Costs, the City shall have the right to continue managing, operating, and expanding the Metro System subject to the same terms set forth in this Agreement, unless otherwise agreed to in writing by and between the City and a Participating Agency. In the event one or more Participating Agency(ies) exercise its/their right(s) to maintain Contract Capacity and wastewater treatment services, such Participating Agency(ies) shall also maintain the right to continue receiving any and all revenues contemplated by this Agreement, including, but not limited to, Metro System Revenues.
14.4 Abandonment. After June 30, 2065, the City may abandon operation of the Metro System upon delivery of notice to the Participating Agencies ten (10) years in advance of said abandonment. Upon notice by the City to abandon the Metro System, the Parties shall meet and confer over the nature and conditions of such abandonment. In the event the Parties cannot reach agreement, the matter shall be submitted to mediation under Section 10. In the event of abandonment, the City shall retain ownership of all Metro System assets free of any claim of the Participating Agencies. Abandonment by the City with continued operation by a different entity shall not terminate or affect a Contract Capacity rights of a Participating Agency so long as that Participating Agency has continued to pay their proportional share of Capital Improvement Costs and Operation and Maintenance Costs according to the billing methodologies set forth in this Agreement. Nothing in this language shall be construed to require the City to continue as operator of the Metro System after the ten-year (10) notice period has run.
15. ADMINISTRATIVE AGREEMENTS
15.1 Use and Process for Administrative Agreements.
15.1.1 Purpose. Administrative Agreements are intended to implement the intent of the Parties in an efficient and effective manner without reopening or renegotiating the terms of this Agreement. Administrative Agreements are limited to addressing issues that are authorized by EXHIBIT A 47 July 7, 2026 Item 4
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this Agreement. Administrative Agreements are separate and distinct from Exhibits to this Agreement, and are designed to address procedural, operational, technical, and administrative issues. Terms in this Agreement may only be modified through the Joint Administrative Approval Process if this Agreement expressly authorizes the use of an Administrative Agreement.
15.1.2 Amendments, Supplements, or Successors to Administrative Agreements.
Where this Agreement refers to an Administrative Agreement, such reference shall include any amendment(s) to that Administrative Agreement or supplemental or successor Administrative Agreement(s).
15.1.3 Function. Administrative Agreements are made among all the Parties but deal with a specific function or group of like functions, for the benefit of regional wastewater treatment within the Metro System, or for the implementation of this Agreement.
15.1.4 Current Agreements. The Administrative Agreements which are approved and executed simultaneously with the execution of this Agreement are listed Exhibit I, List of Administrative Agreements. The City shall update Exhibit I each time an Administrative Agreement is approved, amended, revised or terminated pursuant to this Agreement.
15.1.5 Development and Joint Administrative Approval Process. Any Party can present an Administrative Agreement, or an amendment or supplement thereto, or termination thereof, to the City for approval by way of the Joint Administrative Approval Process set forth in this Section. The City will endeavor in good faith to respond within 60 days of submission of a proposed Administrative Agreement. If the City needs additional time to evaluate the proposed Administrative Agreement, it will advise all Participating Agencies in writing of the anticipated review time. Once an Administrative Agreement receives City’s Administrative Approval, then, with respect to the Participating Agencies, the proposed Administrative Agreement may be presented to the Metro JPA at a duly noticed meeting for review and a first reading. Sixty (60) days or more after the first reading, after the Metro JPA Directors have had opportunity to consult with their respective agency staff and governing boards, the Administrative Agreement may be presented at a duly noticed meeting for a second reading and approved upon an affirmative vote by no less than two-thirds of the members of the Metro JPA during a duly noticed public meeting (in other words, upon the affirmative vote of at least eight or more of the twelve members of the Metro JPA, irrespective of how many Metro JPA Directors are present at the meeting, unless the number of Participating Agencies changes), except that any changes to (i) the FAB, including the Functional Design Methodology required to be approved by way of an Administrative Agreement under Section 5.2.1.3, (ii) how Repurified Water Revenue is shared under Section 6.6, (iii) how the Capital Expense Rate is determined as set forth in Section 6.7; or (iv) how Pure Water Program Cost Allocation and Revenues for Phase 2 are calculated under Section 7, shall require approval by no less than three-quarters of the members of the Metro JPA during a duly noticed public meeting (in other words, upon the affirmative vote of at least nine or more of the twelve members of the Metro JPA, irrespective of how many Metro JPA Director are present at the meeting, unless the number of Participating Agencies changes). If the second reading does not occur within One Hundred and Twenty (120) days after the first reading, the proposed Administrative Agreement shall no longer be taken into consideration, unless the City and the Metro JPA Directors agree to a different timeline. An Administrative Agreement, amendment thereto, or termination thereof, must receive City’s Administrative Approval and at least a two-third affirmative vote by the Metro JPA EXHIBIT A 48 July 7, 2026 Item 4
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Directors before it can become effective. Administrative Agreements are binding contracts as against the City and all Participating Agencies, irrespective of whether or not any Participating Agency’s particular Metro JPA Director voted to approve the agreement or not, or was absent or abstained. The Metro JPA has the authority to bind the Participating Agencies to Administrative Agreements pursuant to the delegated authority provided to the Metro JPA in Section 9.3 herein.
16. GENERAL
16.1 Exhibits.
16.1.1 Exhibit List. This Agreement references Exhibits A through J. Each exhibit is attached to this Agreement and is incorporated herein by reference. All exhibits to this agreement shall be listed in Exhibit K, Exhibit List. The City shall update the Exhibit List from time to time each time an Exhibit is amended or revised pursuant to this Agreement.
16.2 Electronic Exhibits and Attachments. Acknowledgement and Acceptance: The Parties hereby acknowledge and agree that the exhibit(s) and attachment(s) related to this Agreement, or any of its associated Administrative Agreements, indicated as an Electronic Exhibits above (collectively, the “Electronic Exhibits”) may be in an electronic format that cannot be readily or accurately converted into a physical or printed form. The Parties expressly agree that such Electronic Exhibits shall nonetheless be deemed to be valid and enforceable attachments to this Agreement and shall be incorporated by reference as if fully set forth herein.
16.2.1 Identification and Access: All Electronic Exhibits shall bear the same Exhibit identifier and name (i.e., Exhibit A – Metro Facilities) set forth in the Exhibit List, and shall be clearly identified as an Electronic Exhibit in the Exhibit List, including a file name, a time stamp of file, and a note indicating the software used to open and view the file, including version.
The Electronic Exhibit shall be loaded on to a CD-ROM, DVD-ROM, or other electronic storage medium that is a write-once medium without the ability to further edit. Each Party shall receive an identical copy of the Electronic Exhibit(s) via identical storage mediums. The City shall ensure that all Participating Agencies have full and unrestricted access to Electronic Exhibits for the duration of the Agreement and any applicable retention period thereafter, including by providing access to any necessary software, applications, or systems required to view, interact with, or manipulate the Electronic Exhibits in their native format; such as through website access via the GIS Online platform: https://sandiego.maps.arcgis.com. No interaction or manipulation of any Electronic Exhibit shall in any way constitute a bona fide change or amendment to the Electronic Exhibit.
16.2.2 Storage and Security: Each Party shall be responsible for securely storing and maintaining the integrity of the Electronic Exhibits in their possession or control. This includes, but is not limited to, implementing and maintaining reasonable and appropriate technical, administrative, and physical safeguards to protect the confidentiality, availability, and integrity of the Electronic Exhibits, and to prevent unauthorized access, disclosure, alteration, or destruction thereof.
16.2.3 Authentication and Admissibility: The Parties hereby stipulate and agree that the Electronic Exhibits shall be deemed to be original documents and authentic for all purposes EXHIBIT A 49 July 7, 2026 Item 4
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under applicable law, and that the Parties may rely upon and introduce such Electronic Exhibits as evidence in any proceeding arising out of or relating to this Agreement, without the need for further foundation, authentication, or certification.
16.2.4 Receipt and Completeness: Each Party hereby acknowledges and confirms that they have received, reviewed, and had a reasonable opportunity to inspect all Electronic Exhibits that are attached to and incorporated into this Agreement as of the Effective Date. By executing this Agreement, each Party represents and warrants that, to the best of their knowledge, the Electronic Exhibits are complete, accurate, and free from material errors, omissions, or defects.
The Parties further agree to notify the other Party promptly upon discovering any discrepancies or inaccuracies in the Electronic Exhibits, and to cooperate in good faith to resolve any such issues in a timely manner.
16.2.5 Amendments and Modifications to Electronic Exhibits: Any amendments or modifications to the Electronic Exhibits shall be made in accordance with the procedures set forth in this Agreement for amending or modifying the terms and conditions hereof, and any such amended or modified Electronic Exhibits shall be deemed to replace and supersede any prior version thereof. Amended Electronic Exhibits shall also be loaded onto a new and separate CDROM, DVD-ROM, or other electronic storage medium that is a write-once medium without the ability to further edit. Each Party shall receive identical copies of the Electronic Exhibits via identical storage mediums. Amended Electronic Exhibits shall bear identical Exhibit Identifiers as their predecessor exhibits, but with a different suffix (for example, Exhibit A, when amended, shall be identified as Exhibit A-1, a subsequent amendment shall be identified as Exhibit A-2, etc.).
16.3 Amendments to Agreement. There shall be four (4) ways to amend, modify, and/or change the terms set forth in this Agreement:
16.3.1 Amendments. Except as set forth in Sections 16.3.2, 16.3.3, and 16.3.4, amendments to this Agreement require the approval of all Parties. Such amendments must be in writing and signed by a duly authorized representative from each Party. Unless specifically referenced as being subject to one of the approval mechanisms set forth in Sections 16.3.2, 16.3.3, or 16.3.4 below, any amendment, modification, and/or changes to the terms of this Agreement must occur pursuant to this Section 16.3.1. This provision controls over all other provisions in this Agreement.
16.3.2 Joint Administrative Approval Process. As set forth in this Agreement, the Joint Administrative Approval Process requires the approval described in Section 15.1.5. The following actions may be taken subject to the Joint Administrative Approval Process:
(a) Agreements for New Contract Capacity as specifically set forth in Section 3.3
(b) Addition of new Metro Facilities or conversion of City facility to a Metro facility as specifically set forth in Section 4.2 (c) Changes to Exhibit E (Methodology for Contract Capacity Transfers)
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(d) Revisions to FAB as specifically set forth in Section 5.2.1.3, except as provided therein
(e) Changes to Finance, Budgeting, and Accounting System of Charges as specifically set forth in Section 5.11
(f) Changes to Costs Excluded from Metro System Costs – Phase 1 as specifically set forth in Section 6.3
(g) Amending the formula for Repurified Water Revenue as specifically set forth in Section 6.6.2
(h) Changes to Finance, Budgeting, and Accounting for the Pure Water Program Cost Allocation and Revenues for Phase 1 as specifically set forth in Section 6.8
(i) Certain terms relating to Phase 2 as specifically set forth in Section 7.1
(j) Changes to Costs Excluded from Metro System Costs – Phase 2 as specifically set forth in Section 7.2
(k) Terms regarding revenue sharing for Repurified Water for Phase 2 as specifically set forth in Section 7.3
(l) Terms regarding the Capital Expense Rate for Phase 2 as specifically set forth in Section 7.4
(m) Creation, changes, amendments, modifications to, or terminations of any Administrative Agreements as specifically set forth in Article 15.
16.3.3 Two-Party Approval. As set forth in this Agreement, Two-Party Approval requires the City’s Administrative Approval and a two-thirds (2/3) vote or greater of the Metro JPA Directors present at a duly noticed Metro JPA public meeting. The following actions may be taken subject to Two-Party Approval:
(a) Determinations regarding liability as specifically set forth in Section 2.5.5
(b) Contract Capacity Transfers – Decreases as specifically set forth in Section 4.4.3.2
(c) Changes to Strength measurements as specifically set forth in Section 4.5.2
16.3.4 City Administrative Approval. As set forth in this Agreement, the City’s Administrative Approval requires discussion, evaluation, and approval by the Director of the City EXHIBIT A 51 July 7, 2026 Item 4
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of San Diego’s Public Utilities Department or their designee. The City may, in the City’s sole discretion, refer a decision subject to the City’s Administrative Approval to the City Council for a recommendation, approval, or other action. No action is required on the part of a Participating Agency. The following actions may be taken subject to the City’s Administrative Approval:
(a) Transfers of Contract Capacity as specifically set forth in Section 3.2
(b) Reductions in Metro System Capacity as specifically set forth in Section 3.4
(c) Amending Exhibit B as specifically set forth in Section 3.6 (d) Amending Exhibit A as specifically set forth in Section 4.2 (e) Contract Capacity Transfers – Increases as specifically set forth in Section 4.4.3.1
(f) Changes to Exhibit F (Metro System Flow Formulas and Sampling Locations) as specifically set forth in Section 4.5.1
(g) Changes to FAB to include measurements required by law as specifically set forth in Section 5.2.1.3
(h) Changes to Exhibit H if CWA changes their rate structure as specifically set forth in Section 6.6.2
(i) Changes to Exhibit D (Notice) as specifically set forth in Section 13.
16.4 Construction of Agreement.
16.4.1 Drafting of Agreement. It is acknowledged that the City and the Participating Agencies, with the assistance of competent counsel, have participated in the drafting of this Agreement and that no ambiguity should be construed for or against the City or any Participating Agency on account of such drafting.
16.4.2 Entire Agreement. The City and each Participating Agency represent, warrant and agree that no promise or agreement not expressed herein has been made to them, that this Agreement contains the entire agreement between the Parties, that this Agreement supersedes any and all prior agreements or understandings between the Parties unless otherwise provided herein, and that the terms of this Agreement are contractual and not a mere recital; that in executing this Agreement, no Party is relying on any statement or representation made by the other Party, or the other Party’s representatives concerning the subject matter, basis or effect of this Agreement other than as set forth herein; and that each Party is relying solely on its own judgement and knowledge.
16.4.3 Agreement Binding on All; No Third-Party Beneficiaries. This Agreement shall be binding upon and shall inure to the benefit of each of the Parties, and each of their EXHIBIT A 52 July 7, 2026 Item 4
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respective successors, assigns, trustees or receivers. All the covenants contained in this Agreement are for the express benefit of each and all such Parties. This Agreement is not intended to benefit any third parties, and any such third-party beneficiaries are expressly disclaimed.
16.4.4 Severability.
16.4.4.1 Should any provision of this Agreement or any associated Administrative Agreement be held invalid or illegal, such invalidity or illegality shall not invalidate the whole of the Agreement, but, rather, the Agreement shall be construed as if it did not contain the invalid or illegal part, and the rights and obligations of the Parties shall be construed and enforced accordingly except to the extent that enforcement of the Agreement without the invalidated provision would materially and adversely frustrate either the City’s or a Participating Agency’s essential objectives set forth in this Agreement or the applicable Administrative Agreement.
16.4.4.2 Should a court determine that one or more components of the allocation of costs set forth in this Agreement or any associated Administrative Agreement places the City or a Participating Agency in violation of Article XIII D, Section 6 of the California Constitution with respect to their ratepayers, such components shall no longer be of force or effect.
In such an event, the City and the Participating Agencies shall promptly meet to renegotiate the violative component of the cost allocation to comply with Article XIII D, Section 6 of the California Constitution, and use the dispute resolution process in Section 10 of this Agreement if an agreement cannot be reached through direct negotiation.
16.4.4.3 Should a state or federal agency provide a final, written determination that the method of allocating Pure Water Program Capital Improvement Costs under this Agreement violates the requirements of state or federal grants or loans which are, or will be, used to fund the wastewater components of the Pure Water Program, such allocation method will no longer be of any force or effect. In such an event, the allocation of Repurified Water Revenue and the Capital Expense Rate will continue to be based on the Parties’ actual payments to fund the Pure Water Program Capital Improvement Costs attributable to the Metro System. The City and the Participating Agencies shall also promptly meet to negotiate an alternative cost allocation method that would comply with such grant or loan funding requirements.
16.4.5 Choice of Law. This Agreement and any of its associated Administrative Agreements shall be construed and enforced pursuant to the laws of the State of California.
16.4.6 Recognition of San Diego Sanitation District as Successor to Certain Parties. The Parties hereby acknowledge and agree that the San Diego County Sanitation District is a Participating Agency under this Agreement as the successor in interest to the Alpine Sanitation District, East Otay Mesa Sewer Maintenance District, Lakeside Sanitation District, Spring Valley Sanitation District, and Winter Gardens Sewer Maintenance District.
16.5 Declarations Re: Agreement.
16.5.1 Understanding of Intent and Effect of Agreement. The Parties expressly declare and represent that they have read the Agreement and that they have consulted with their respective counsel regarding the meaning of the terms and conditions contained herein. The Parties EXHIBIT A 53 July 7, 2026 Item 4
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further expressly declare and represent that they fully understand the content and effect of this Agreement and they approve and accept the terms and conditions contained herein, and that this Agreement is executed freely and voluntarily.
16.5.2 Warranty Regarding Obligation and Authority to Enter Into This Agreement. Each Party represents and warrants that its respective obligations herein are legal and binding obligations of such Party, that each Party is fully authorized to enter into this Agreement, and that the person signing this Agreement hereinafter for each Party has been duly authorized to sign this Agreement on behalf of said Party.
16.6 Right to Make Other Agreements. Nothing in this Agreement limits or restricts the right of the City or the Participating Agencies to make separate agreements among themselves, including through joint powers agreements, without the need to amend this Agreement, provided that such agreements are consistent with this Agreement. Nothing in this Agreement or Section 6 limits or restricts the right of the City or the Participating Agencies to enter into separate agreements regarding the industrial pretreatment program, or for the purchase or sale of Repurified Water produced by the Water Repurification System, or sharing in City Water Utility PW Costs; however, such agreements shall not affect the cost allocation and Metro System revenues delineated in Section 5.
16.7 Statute of Limitations to Resolve Billing Issues. Notwithstanding any longer statute of limitations in State law, if the City or a Participating Agency wishes to dispute a bill (including, but not limited to, an audited bill or an audit reconciliation) on the basis of an alleged overpayment or underpayment arising under this Agreement, the Party alleging the dispute must provide written notice regarding the disputed bill to all Parties to this Agreement promptly upon discovery of such a billing issue. The written notice shall invoke or reference this Section. The Parties agree that such refunds or collections shall not accrue for more than three (3) years from the date that such billing is received by the Participating Agency, or one (1) year from the date that an audited reconciliation is received by the Participating Agency, whichever date is later. The City and the Participating Agencies hereby waive any applicable statute of limitations available under State law that exceed the time frames set forth in this Section 16.7. Upon receipt of the written notice regarding the billing dispute, any Participating Agency wishing to participate in the resolution of the dispute shall be allowed to do so and to present evidence to all Parties in support of their position. The involved Parties’ determination regarding the outcome of the billing dispute, including any related adjustments to each Participating Agency’s share of net Metro System costs or revenues resulting from the resolution of such billing issues, shall be final. Nothing in this section relieves a Participating Agency from its obligations to make timely payments under this Agreement irrespective of whether or not a bill is being disputed. If the Parties are unable to resolve a billing dispute, the Parties shall utilize the dispute resolution processes in this Agreement.
16.8 Counterparts and Electronic Signatures. This Agreement may be executed in counterparts. This Agreement shall become operative as soon as one counterpart hereof has been executed by each Party. The counterparts so executed shall constitute one Agreement notwithstanding that the signatures of all Parties do not appear on the same page. A faxed, .pdf, or other electronic copy of the fully executed original version of this Agreement shall have the same legal effect as an executed original for all purposes. Electronic signatures (including but not limited EXHIBIT A 54 July 7, 2026 Item 4
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to signatures via DocuSign) shall be acceptable, enforceable, and shall have the same legal effect as an original signature.
16.9 Transparency. Upon request, the City shall promptly provide each Participating Agency with access to all records and information reflecting Flow and Strength of sewage in the Metro System, including, but not limited to, Flow data from all Metro System meters, worksheets or calculations that are used by City to develop cost information for any costs contemplated by this Agreement, and any Strength or other data utilized by the City when calculating annual sewage Flow and/or other costs imposed pursuant to this Agreement (including, but not limited to, pretreatment costs). The Parties shall work in good faith together to ensure the Participating Agencies have reasonable and full transparency under this Agreement.
16.10 Incorporation of Recitals. All of the recitals set forth in this Agreement, and all of the exhibits attached to this Agreement, are by this reference incorporated in and made a part of this Agreement as though fully set forth herein.
16.11 Joint Exercise of Power. It is the intent of the Parties that this Agreement is intended to exercise the governmental authority granted pursuant to Gov. Code Section 6500 et seq. which provides for the joint exercise of governmental powers.
IN WITNESS WHEREOF, the Parties have executed this Second Amendment and Restated Regional Wastewater Disposal Agreement and the associated Administrative Agreements(s) identified herein as of the date first set forth above.
CITY OF CHULA VISTA
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF CORONADO
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF DEL MAR
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF EL CAJON
Name:
Title:
Approved as to Form:
Name:
Title:
EXHIBIT A 55 July 7, 2026 Item 4
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CITY OF IMPERIAL BEACH
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF LA MESA
Name:
Title:
Approved as to Form:
Name:
Title:
LEMON GROVE SANITATION DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF NATIONAL CITY
Name:
Title:
Approved as to Form:
Name:
Title:
OTAY WATER DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
PADRE DAM MUNICIPAL WATER
DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF POWAY
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF SAN DIEGO
Name:
Title:
Approved as to Form:
Name:
Title:
EXHIBIT A 56 July 7, 2026 Item 4
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SAN DIEGO COUNTY SANITATION
DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
EXHIBIT A 57 July 7, 2026 Item 4
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EXHIBIT A
Metro Facilities (Electronic Exhibit); file name: 2025-10_Exhibit A Metro Facilities.aprx; time stamp of file: 10/23/2025 3:38 PM, software used to open and view file including version: ArcGIS Pro 3.5.0; included herewith as CD-ROM/DVD-ROM EXHIBIT A 58 July 7, 2026 Item 4
Exhibit A: Listing of Metro Facilities as of 6/12/2026
Metro Facilities (Electronic Exhibit);
file name: 2025-10_Exhibit A Metro Facilities.aprx
time stamp of file: 10/23/2025 3:38 PM
software used to open and view file including version:
ArcGIS Pro 3.5.
EXHIBIT A 59 July 7, 2026 Item 4
1 The South Bay Land/Ocean Outfall is jointly owned by the International Boundary and Water Commission, U.S. Section (60.06%) and the City of San Diego (39.94%). The capacity of the City's portion of the outfall as of the date of this Agreement is 74 MGD average dry weather flow, of which the Metro System has a capacity right to 69.2 MGD and the City as an exclusive right to 4.8 MGD 2 Gravity pipeline connection between NCWRP and the North Metro Interceptor 3 Included separately from rest of treatment plant to acknowledge role in sludge treatment process.
EXHIBIT A
METRO FACILITIES AS OF 6/12/2026
TREATMENT FACILITIES
Point Loma Facilities (PLWWTP)
• Advanced Primary Treatment Plant
• Ocean Outfall
• Access Road
• Power Generation Facility
North City
• Water Reclamation Plant (NCWRP)
South Bay
• Water Reclamation Plant (SBWRP)
• South Bay Land/Ocean Outfall1
SLUDGE TREATMENT CONVEYANCE FACILITIES
• Metro Biosolids Center (MBC)
• Point Loma Digesters3
• Digested Sludge Pipeline: Point Loma to MBC
• Raw sludge pipeline: NCWRP to MBC
• Centrate Pipeline: MBC to NCWRP
• Raw sludge pipeline: SBWRP to South Metro Interceptor
CONVEYANCE
• Pump Station 1
• Pump Station 1 Force Main
• Pump Station 2
EXHIBIT A 60 July 7, 2026 Item 4
1 The South Bay Land/Ocean Outfall is jointly owned by the International Boundary and Water Commission, U.S. Section (60.06%) and the City of San Diego (39.94%). The capacity of the City's portion of the outfall as of the date of this Agreement is 74 MGD average dry weather flow, of which the Metro System has a capacity right to 69.2 MGD and the City as an exclusive right to 4.8 MGD 2 Gravity pipeline connection between NCWRP and the North Metro Interceptor 3 Included separately from rest of treatment plant to acknowledge role in sludge treatment process. • Pump Station 2 Force Mains
• Pump Station 2 Backup Power Generation Facility
• South Metro Interceptor
• North Metro Interceptor
• Grove Avenue Pump Station
• Grove Avenue Pump Station Force Main
• Rose Canyon Parallel Trunk Sewer 2
• Second Rose Canyon Trunk Sewer 2
• East Mission Bay Trunk Sewer 2
• Morena Blvd. Interceptor 2
• Metro System Meters (including 88 billing meters and 14 operational meters) • North City Tunnel Connector
• West Point Loma Interceptor
OTHER FACILITIES
• Environmental Monitoring and Technical Services Laboratory (95% Metro Ownership)
• Metro Operation Center aka MOC (17% Metro Ownership)
• Dairy Mart Road & Bridge
FUTURE METRO FACILITIES
Phase 1 Pure Water (Under Construction – Percent ownership will be assigned after audit) • Expand NCWRP
• Morena Pump Station
• Morena Pump Station Force Main
• Centrate/RSDP Line (From NCWRP to North Metro Interceptor) • East Mission Gorge / East County residuals line (Water, Muni, and Metro combined assets)
EXHIBIT A 61 July 7, 2026 Item 4
1 The South Bay Land/Ocean Outfall is jointly owned by the International Boundary and Water Commission, U.S. Section (60.06%) and the City of San Diego (39.94%). The capacity of the City's portion of the outfall as of the date of this Agreement is 74 MGD average dry weather flow, of which the Metro System has a capacity right to 69.2 MGD and the City as an exclusive right to 4.8 MGD 2 Gravity pipeline connection between NCWRP and the North Metro Interceptor 3 Included separately from rest of treatment plant to acknowledge role in sludge treatment process.
Phase 2 Pure Water Planned
• Phase 2 Pure Water (TBD)
• Phase 2 Pure Water Centrate Line (TBD)
Reserved Rights- Other Future Facilities
The facilities listed in this category will potentially be required as part of the Metro System for hydraulic capacity, good engineering practices and/or compliance with applicable law, rules or regulations, including compliance with OPRA, and continuation and maintaining the City’s Waiver of applicable treatment standards at the Point Loma Wastewater Treatment Plant (“Waiver”).
• South Bay Secondary Treatment Plant (21-28 MGD)
• South Bay Secondary Sewers & Pump Station (Sweetwater River) • South Bay Sludge Processing Facility
• Wet Weather Storage Facilities
EXHIBIT A 62 July 7, 2026 Item 4
EXHIBIT A 63 July 7, 2026 Item 4
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EXHIBIT B
DISTRIBUTION OF WASTEWATER SYSTEM CAPACITY RIGHTS
EXHIBIT A 64 July 7, 2026 Item 4
1 2 3 4 5 6 7
Average Flow2,
MGD
Incremental
Peak Flow3,
MGD
RSPD4, MGD
Total Allowable
Flow3,
MGD
TSS2,
1,000 lbs.
COD2,
1,000 lbs. Pure Water Phase 15
18.33 19.52 0 37.85 22,082 38,419 11.699%
1.90 3.03 0 4.93 2,089 3,336 1.152%
0.00 0.30 0 0.30 0 0 0.020%
1.79 3.48 0 5.27 1,915 3,336 1.096%
1.29 19.93 0.602 21.82 2,196 3,052 0.497%
2.47 4.48 0 6.95 2,045 3,844 1.411%
5.29 23.90 0 29.19 4,668 9,636 2.823%
0.07 1.67 0.310 2.05 238 293 0.153%
2.40 4.51 0 6.91 2,289 4,387 1.395%
4.65 3.07 0 7.72 4,562 9,161 2.852%
0.38 0.57 0 0.95 984 835 0.457%
0.44 6.54 0.364 7.34 632 890 0.444%
3.10 8.80 0 11.90 3,113 5,073 1.869%
5.74 5.05 0 10.79 6,039 10,597 3.765%
0.02 1.08 0.080 1.18 65 80 0.044%
47.9 105.9 1.356 155.1 52,916 92,938 29.677%
124.05 136.16 0 260.21 130,032 252,818 70.323%
0 0 14.3 0.00 0 0 0
124.1 136.2 14.3 260.2 130,032 252,818 70.323%
- 82 - 82 - - -
171.9 324.1 15.7 497.4 182,948 345,756 100%
2. Based on monthly average flow and strength.
3. Based on hourly average flow.
ANNUAL FIXED CAPACITY RIGHTS1
DISTRIBUTION OF WASTEWATER SYSTEM CAPACITY RIGHTS
Lakeside/Alpine
AGENCY
Chula Vista
Coronado
Del Mar
East Otay Mesa
El Cajon
Imperial Beach
La Mesa
SUBTOTAL
Lemon Grove
National City
Otay
Padre Dam
Poway
Spring Valley
Wintergardens
SUBTOTAL
5. Pure Water Phase 1 Capital Melded Percentages as established in Exhibit G of the "Amended and Restated Regional Wastewater Disposal Agreement Between the City of San Diego and the Participating Agencies in the Metropolitan Sewerage System" memorialized here only for use in billing Pure Water Phase 1 capital expenses. The following fractions were used to calculate the Melded Percentage (Based on 5 year average and not subject to change except by agreement of the parties.)
FLOW SS COD
0.482 0.257 0.243
4. Reject Stream from Demineralization Process
1. Currently based on 2050 projected flows and strengths.
EXHIBIT B
Metro I&I
San Diego
Wastewater
Water
TOTAL
7/18/2025
EXHIBIT A 65 July 7, 2026 Item 4
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EXHIBIT C
ADMINISTRATIVE PROTOCOL ON ALLOCATION OF OPERATING RESERVES
AND DEBT SERVICE COVERAGE TO PARTICIPATING AGENCIES
EXHIBIT A 66 July 7, 2026 Item 4
EXHIBIT A 67 July 7, 2026 Item 4
EXHIBIT A 68 July 7, 2026 Item 4
EXHIBIT A 69 July 7, 2026 Item 4
EXHIBIT A 70 July 7, 2026 Item 4
EXHIBIT A 71 July 7, 2026 Item 4
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EXHIBIT D
NOTICE LISTING
EXHIBIT A 72 July 7, 2026 Item 4
4914-3650-2326
EXHIBIT D
NOTICE LISTING
Maria Kachadoorian
City Manager
City of Chula Vista
276 Fourth Avenue
Chula Vista, CA 91919
Phone: (619) 691 5031
mkachadoorian@chulavista
ca.gov
Tina Friend
City Manager
City of Coronado
1825 Strand Way
Coronado, CA 92113
Phone: (619) 522-7335
[email protected]
Ashley Jones
City Manager
City of Del Mar
1050 Camino Del Mar
Del Mar, CA 92014
Phone: 755-9313 ext. 25
[email protected]
Graham Mitchell
City Manager
City of El Cajon
200 Civic Center Way
El Cajon CA 92020
Phone: (619) 441-1716
[email protected]
Tyler Foltz
Greg Humora
City Manager
City of La Mesa
8130 Allison Avenue
La Mesa, CA 91942
Phone: (619) 667-1101
[email protected]
Lydia Romero
City Manager
City of Lemon Grove
3232 Main Street
Lemon Grove, CA 91945
Phone: (619) 464-6934
[email protected]
Scott Huth
Acting City Manager
City of National City
1243 National City Blvd.
National City, CA 91950
Phone: (619) 336-4240
[email protected]
Chris Hazeltine
City Manager
City of Poway
13325 Civic Center Drive
Poway, CA 92064
Phone: (858) 679-4200
[email protected]
Mayor Todd Gloria
Chief Operating Officer
City of San Diego
202 "C" Street
San Diego, CA 92101
Phone: (619) 236-5949
[email protected]
Ebony Shelton
Chief Administrative Officer County
of San Diego
1600 Pacific Highway, Rm. 209
San Diego, CA 92101
Phone: (619) 531-5250
[email protected]
Jose Martinez
General Manager
Otay Water District
2554 Sweetwater Springs Blvd.
Spring Valley, CA 91977
Phone: (619) 670-2210
[email protected]
Kyle Swanson
CEO/General Manager
Padre Dam Municipal Water
District
9300 Fanita Pkwy
Santee, CA 92071
Phone: (619) 258-4673
[email protected]
City Manager
City of Imperial Beach
825 Imperial Beach Blvd.
Imperial Beach, CA 91932
Phone: (619) 423-8300 ext. 7
[email protected]
EXHIBIT A 73 July 7, 2026 Item 4
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EXHIBIT E
METHODOLOGY FOR CONTRACT CAPACITY TRANSFERS
EXHIBIT A 74 July 7, 2026 Item 4
Last Updated: 5/29/2025
EXHIBIT E
METHODOLOGY FOR CONTRACT CAPACITY TRANSFERS
The following exhibit describes the methodology for transferring contract capacities from the Metro Pooled Capacity (summarized in the table below) to a Party’s contract capacity defined in Exhibit B.
POOLED CAPACITY
Average Flow,
mgd
Incremental Peak1,
mgd
TSS,
1,000 lbs.
COD,
1,000 lbs.
After Phase 1 Pure Water 0 10296,820 27,521
After Phase 2 Pure Water 10 20 96,820 27,521
1. At Point Loma WWTP
2. Assume system storage
If a transfer of contract capacity is initiated as set forth in Section 4.4.3.1, capacity will be taken from the Pooled Capacity and added to the Party in need of additional capacity. Thereafter, the above table of Pooled Capacity will be updated with the subject column reduced, and Exhibit B will be updated with the subject Party’s contract capacity correspondingly increased.
In lieu of transferring average flow capacity from the Pooled Capacity to a Party, the Party can choose to transfer Incremental Peak Flow Capacity to Average Flow Capacity keeping Total Allowable Flow the same, assuming the Party would still have sufficient Total Allowable Flow Capacity for their peak flows.
If a transfer of contract capacity as set forth in Section 4.4.3.2, the reverse shall occur and the subject Party’s contract capacity will be reduced in Exhibit B and the Pooled increased.
In lieu of transferring average flow capacity to the Pooled Capacity from a Party, the Party can choose to transfer Average Flow Capacity to Incremental Peak Flow Capacity keeping Total EXHIBIT A 75 July 7, 2026 Item 4
Last Updated: 5/29/2025
Allowable Flow the same, if they anticipate needing their current Total Allowable Flow for their peak flows.
The remainder of this Exhibit has examples of how these transfers would be performed and the estimated effect on a Party’s share of Metro System Costs under the FAB Billing System. Please note Metro System costs will change from time to time as well as Contract Capacities per Exhibit B, so the following are only examples and not meant to be exact. These examples are based on Exhibit B as of the signing of this agreement, not necessarily the last revision of this exhibit. These examples are currently based on FY24 unaudited costs and estimated FY27 billing units.
EXHIBIT A 76 July 7, 2026 Item 4
EXHIBIT A 77 July 7, 2026 Item 4
EXHIBIT A 78 July 7, 2026 Item 4
EXHIBIT A 79 July 7, 2026 Item 4
EXHIBIT A 80 July 7, 2026 Item 4
EXHIBIT A 81 July 7, 2026 Item 4
EXHIBIT A 82 July 7, 2026 Item 4
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EXHIBIT F
METRO SYSTEM FLOW FORMULAS AND SAMPLING LOCATIONS
EXHIBIT A 83 July 7, 2026 Item 4
EXHIBIT F –
METRO SYSTEM FLOW FORMULAS AND
SAMPLING LOCATIONS
JULY 2025
LEGEND
Billing and Sampling Meters
Billing Meters
Municipal Meter
EXHIBIT A 84 July 7, 2026 Item 4
CHULA VISTA
Hollister
& Main
Meter
CV1
“J” ST
Meter
CV2
“G” ST
Meter
CV3
Autopark
&
Crossings
(0.025
mgd)
Waterpark &
Amphitheater
(0.031 mgd)
Lagoon
Drive
(0.011
mgd)
Bay Blvd
North
(106
EDUs)
Bay Blvd
South
(16
EDUs)
Gunpowder
Point
(51 EDUs)
Acacia
Ave
SV to CV
(4 EDUs)
Combined
Housecounts
(1,040
EDUs)
E. Flower
Street
Meter
CV5
Plaza
Bonita-1
Meter
CV6M
Plaza
Bonita-2
Meter
CV7M
Las Flores
Dr
Meter
CV8
N. Fifth
Ave
Meter
CV9
Acacia
Ave
Meter
CV10
Otay
Lakes
Road
Meter
CV11
Proctor
Valley
Meter
CV12
Main
Street
Meter
CV14
CHULA
VISTA
TOTAL
EXHIBIT A 85 July 7, 2026 Item 4
CORONADO
Trans-Bay
Meter C1M
Amphibious
Base
Meter C2
North Island
Meter C3
CORONADO
TOTAL
EXHIBIT A 86 July 7, 2026 Item 4
DEL MAR
Meter DM2
Riviera Del
Mar
(110 EDUs)
Connection
#1
(96 EDUs)
Connection
#2
(21 EDUs)
Del Mar
Estates
(27 EDUs)
DEL MAR
TOTAL
EXHIBIT A 87 July 7, 2026 Item 4
EAST OTAY MESA
EOM1 Meter
East Otay Mesa
(55.4 EDUs)
EAST OTAY
MESA TOTAL
EXHIBIT A 88 July 7, 2026 Item 4
EL CAJON
El Cajon Meter
EC1B
To LM Meter
LM4
To LM
(321.5 EDUs)
Winter Gardens
Meter WG1M
Winter Gardens
(1,383 EDUs)
EL CAJON
TOTAL
EXHIBIT A 89 July 7, 2026 Item 4
IMPERIAL BEACH
9 th & Imp.
Meter IB1
Elder St.
Meter IB2M
Palm Ave.
Meter IB3M2
Georgia Street
(170.5 EDUs)
Palm Avenue
(29.5 EDUs)
IMPERIAL
BEACH
TOTAL
EXHIBIT A 90 July 7, 2026 Item 4
LA MESA
La Mesa
North
LM3
Meter
Colorado
(16
EDUs)
73rd &
Sar.
(22
EDUs)
Alvarado
Trtmnt
Plant
(61 EDUs)
Alvarado
Lab
(27
EDUs)
Alvarado
Training
Ctr.
(2 EDUs)
Blue
Lake
(69
EDUs)
East
Lake
(349
EDUs)
Jackson
(279
EDUs)
Keeny
(28
EDUs)
Lake
Arago
(292.7
EDUs)
Lake
Murray
(119.8
EDUs)
La Mesa
South
LM1AM
Meter
LM7
Meter
68th &
Univ
(91
EDUs)
67th &
Valencia
(158.5
EDUs)
Rosefield
(20
EDUs)
Alamo
(4 EDUs)
Vigo
(204
EDUs)
69th &
University
(34 EDUs)
70th &
Colony
(551.5
EDUs)
73rd & El
Cajon
(15.6
EDUs)
To SV
(52
EDUs)
To SV
LM2
Meter
To SV
LM5A
Meter
To SV
LM8
Meter
To LG
(921.7
EDUs)
From EC
LM4
Meter
From EC
(311
EDUs)
LA
MESA
TOTAL
EXHIBIT A 91 July 7, 2026 Item 4
LAKESIDE/ALPINE
Meter
LS2
LAKESIDE
ALPINE
TOTAL
EXHIBIT A 92 July 7, 2026 Item 4
LEMON GROVE
Winnett &
Oriole St
LG1M
Meter
Akins &
69th
LG2M
Meter
Imperial &
Viewcrest
LG4
Meter
Total
Lemon
Grove to
SV
(1547.63
EDUs)
Net from
La Mesa
(921.7
EDUs)
69th &
Madera
LG3
Meter
Madera
(4 EDUs)
Calvacado
(121
EDUs)
69th &
Klauber
(3 EDUs)
Gold Lake
(48 EDUs)
Angelus
Avenue
(12 EDUs)
69th &
Evelyn
(4 EDUs)
College
Avenue
(498.6
EDUs)
Navy
Housing
(278 EDUs)
College
Grove
(25.6 EDUs)
69th &
Gibson
(3 EDUs)
College
Grove Way
(161 EDUs)
LEMON
GROVE
TOTAL
EXHIBIT A 93 July 7, 2026 Item 4
NATIONAL CITY
33rd St
NC2
Meter
21st &
Hoover
NC3A
Meter
2262
Hoover
NC3B
Meter
West of
I5
NC3C
Meter
22nd &
Hoover
NC Yard
& HC
(2 EDUs)
7 th &
Wilson
NC5
Meter
Nordica
NC7M
Meter
Stockman
NC15
Meter
Southland
Ind. Park
(76.5
EDUs)
Rachael
Ave.
North
(46
EDUs)
Olive
Avenue
(6
EDUs)
Bonita
Paradise
(47
EDUs)
Rachel
Ave.
South
(43
EDUs)
NC to SV
Inter-Agency
Compromise
(36 EDUs)
Plaza
Bonita
NC8M
Meter
Sweetwater
Road
(52.72%)
NC13
Meter
Prospect
St
(39.16%)
NC16
Meter)
SV to NC I-A
Compromise
(144 EDUs)
Harbor
Drive
NC6
Meter
Delta St.
NC9M
Meter
Paradise
Val
NC10
Meter
Olive
Ave.
NC11
Meter
18th &
Rachael
NC12
Meter
Dalbergia
(26.3
EDUs)
Nordica
(36
EDUs)
Bryanview
(16 EDUs)
Lorenz
(42
EDUs)
Mariposa
(18
EDUs)
Ebbs
(291
EDUs)
Delta St
(100.5
EDUs)
Navy
Sports
Center
(7 EDUs)
NATIONAL
CITY
TOTAL
EXHIBIT A 94 July 7, 2026 Item 4
NAVY
Amphibious Base
Meter (C2)
North Island
Meter (C3)
NAVY TOTAL
EXHIBIT A 95 July 7, 2026 Item 4
OTAY
Otay Net
OTAY
TOTAL
EXHIBIT A 96 July 7, 2026 Item 4
PADRE DAM
Padre Dam
Meter PD1B
Lakeside
Meter LS2
Simeon Dr.
(413 EDUs)
Padre Dam
Meter PD2
Cowles Mtn.
(270 EDUs)
Treviso
(186 EDUs)
PADRE DAM
TOTAL
EXHIBIT A 97 July 7, 2026 Item 4
POWAY
Springhurst
PO2
Meter
La
Manda
(53
EDUs)
Camino
Del Norte
PO1
Meter
Holland
Canyon
PO3M
Meter
Eastview
Ct.
PO4
Meter
Highland
Ranch
PO5
Meter
Creek
Road
PO6
Meter
Springhurst
Street
(72 EDUs)
Stone
Canyon
(727.14
EDUs)
POWAY
TOTAL
EXHIBIT A 98 July 7, 2026 Item 4
SPRING VALLEY
SubTotal Chula Vista to SV = Combined Housecounts – Acacia Ave + CV5 + CV6 + CV7M + CV8 + CV9 + CV10 + CV11 + CV12 + CV14
Brisbane
& 5th
SV8M
Meter
Lincoln
Acres/Alta
Drive
(84.4
EDUs)
Sweetwater
(52.72%)
NC13
Meter
Prospect
St
(39.16%)
NC16
Meter
SV to NC
Inter-Agency
Compromise
(144 EDUs)
NC to SV
Inter-Agency
Compromise
(36 EDUs)
From
NC
NC8M
Meter
SubTotal
Chula
Vista to
SV
To SV
LM2
Meter
To SV
LM5A
Meter
To SV
LM8
Meter
SubTotal
La Mesa
to SV
(52
EDUs)
SubTotal
Lemon
Grove to
SV
(1,547.63
EDUs)
Bonita
BO1
Meter
Manzana
Way
(439
EDUs)
Parkbrook
Street
(197
EDUs)
Noeline
Avenue
(109
EDUs)
Worthington
Street
(64 EDUs)
Innsdale
Avenue
(51
EDUs)
Greenridge
Avenue
(10 EDUs)
Ellenwood
Circle
North
(9 EDUs)
Delrose
Avenue
(109
EDUs)
Crestmore
Avenue
(8 EDUs)
Potrero
Street
(61
EDUs)
Carlsbad
Street
(41
EDUs)
Otay Net
SPRING
VALLEY
TOTAL
EXHIBIT A 99 July 7, 2026 Item 4
WINTER GARDENS
Winter Gardens
Meter (WG1M)
WG House Count
1,383 EDUs
WINTER
GARDENS
TOTAL
EXHIBIT A 100 July 7, 2026 Item 4
CITY OF SAN DIEGO
SD33
Meter
N. Harbor
Drive
(2,550.4
EDUs)
SD1E
Meter
SD2A
Meter
SD2B
Meter
Sports
Area
Blvd.
(498
EDUs)
SD3
Meter
Barnett
Avenue
(2551.6
EDUs)
SD5M
Meter
SD20
Meter
SD40M2
Meter
SD42M
Meter
SD7B
Meter
SD8
Meter
Commercial
Street
(1,458.6
EDUs)
SD12
Meter
SD6M
Meter
Del Mar
Net
Poway
Net
SD1B
Meter
EC1B
Meter
Padre
Dam Net
Lakeside
Net
LM
North to
San
Diego
Net
SD19
Meter
Anna
Street
(564
EDUs)
SD7A
Meter
SD7C
Meter
Coronado
Net
Beach
Street
(1,944.2
EDUs)
SD9
Meter
LG to
San
Diego
Net
LM
South to
San
Diego
Net)
SD9D
Meter
NC7M
Meter
NC9M
Meter
EXHIBIT A 101 July 7, 2026 Item 4
CITY OF SAN DIEGO (Continued)
NC10
Meter
NC11
Meter
Olive
Ave.
(6
EDUs)
NC12
Meter
Rachael
Ave.
North
(46
EDUs)
NC6
Meter
San
Diego
HC
Through
NC Total
BO1
Meter
NC15
Meter
Bonita
Paradise
(47
EDUs)
Rachael
Ave.
South
(43 EDUs)
Alta
Drive
(84.4
EDUs)
San Diego
HC
Through
SPV Total
SD10
Meter
Waterpark &
Amphitheater
Autopark &
Crossings
PC1
Meter
IB2M
Meter
Georgia
Street
(170.5
EDUs)
Palm
Avenue
(29.5
EDUs)
IB3M2
Meter
SB1
Meter
SD11
Meter
SD11A
Meter
SD18
Meter
Small SD
House
Count
(694.3
EDUs)
Elm
Street
(1,455
EDUs)
USN4
Meter
USN5
Meter
USN8
Meter
USN11
Meter
SAN
DIEGO
TOTAL
EXHIBIT A 102 July 7, 2026 Item 4
- 55 -
6-12-26
4932-3639-7490
EXHIBIT G
SAMPLE OF INTEREST CALCULATION
EXHIBIT A 103 July 7, 2026 Item 4
Exhibit G - Sample of the Interest Calculation (Section 6.6) Purpose: To document assumptions used to account for the time value of money for shared Pure Water costs (Allocated Shared Costs) that were agreed to be reconciled at a later date based on final Phase 1 project costs.
This is discussed in Section 6.6: Reallocation of PWP Costs incurred since FY2014 and cited in Section 6.6.1.3. See the example" Calculator Spreadsheet" below and accompanying footnotes. .
C D E F G H I J K L M
50/ 50 Expenses from
That Year
Original
Metro Split
%
Original Water
Split %
Original
Metro Share
Original
Water Share
Metro Post
Allocation
Share
Amounts Subject
to Interest
(50% Cost - Metro
Share%)
Running Metro
Balance Subject to
Interest
(New Activity + Prior
Year Balance + Prior
Interest Earning)
Yearly Interest
Earnings
(Compounded
Monthly)
Estimated PA
share
( Average share of
Interest Earnings)
Annual Interest
Rate
(San Diego City
Treasurers)
FY 2014 $630,109 50% 50% $315,055 $315,055 $283,549 $31,505 $31,505.46 $138.27 $41.48 0.438% FY 2015 $2,476,617 50% 50% $1,238,309 $1,238,309 $1,114,478 $123,831 $155,474.59 $871.33 $261.40 0.559% FY 2016 $4,503,182 50% 50% $2,251,591 $2,251,591 $2,026,432 $225,159 $381,505.03 $2,971.03 $891.31 0.776% FY 2017 $7,398,893 50% 50% $3,699,447 $3,699,447 $3,329,502 $369,945 $754,420.72 $8,150.10 $2,445.03 1.075% FY 2018 $6,194,711 50% 50% $3,097,355 $3,097,355 $2,787,620 $309,736 $1,072,306.36 $14,783.19 $4,434.96 1.370% FY 2019 $7,844,738 50% 50% $3,922,369 $3,922,369 $3,530,132 $392,237 $1,479,326.46 $31,230.90 $9,369.27 2.091% FY 2020 $8,018,735 50% 50% $4,009,367 $4,009,367 $3,608,431 $400,937 $1,911,494.09 $43,708.61 $13,112.58 2.263% FY 2021 50% 50% $0 $0 $0 $0 $1,955,202.70 $29,649.45 $8,894.84 1.506% FY 2022 50% 50% $1,984,852.16 $16,257.11 $4,877.13 0.816% FY 2023 32% 68% $2,001,109.26 $35,993.15 $10,797.94 1.784% FY 2024 32% 68% $2,037,102.41 $59,323.71 $17,797.11 2.874% FY 2025 32% 68% TBD
FY 2026 32% 68% TBD
FY 2027 32% 68% TBD
Totals $37,066,985 $18,533,493 $18,533,493 $16,680,143 $1,853,349 $13,764,299 $243,077 $72,923 N/A Pending Final Audits:
Estimated Final Metro % of Pure Water Costs (Draft) 45% Estimated JPA % Share of Metro Expenses (Draft) 30%
EXHIBIT A 104 July 7, 2026 Item 4
Exhibit G - Sample of the Interest Calculation (Section 6.6) (Continued) Procedures and Assumptions:
The City proposes the following procedures be used to allocate these costs. These costs will be allocated 1 year after substantial completion of Pure Water Phase 1, as part of the annual Audit of Metro costs (Projected to be annual audit of metro activity for Fiscal Year 2026). The City will prepare a yearly update to the calculator as part of the preparation for the yearly metro audit.
Column Description:
Cost Included (Column C) This column represents cost subject to this calculator. This includes Purchase Orders (and their associated expenditures) that have been split 50%/50% (50/50 POs) from 2014 to 2022 and have been included as part of each yearly audit of Metro JPA Pure Water costs. This sheet is prepared by the City and reviewed by the JPA's consultants on a yearly basis to determine samples for the Pure Water O&M costs. After awarding of all Pure Water construction contracts, new costs will use an updated percentage based on actual awarded construction contracts. This date will be called out on the purchase order sheet and a new line on the calculator will be added to track the change in percent allocation.
Open purchase orders using the 50/50 split will be separated on the calculator sheet until they are fully spent, closed or amended to the new split.
Original Splits % (Column D & E) These columns split the total costs of the 50/50 POs based on their original share between the water and Metro funds. This establishes each funds initial share of the costs Original Share (Column F & G) These columns split the total costs in Column C by the percentages in Columns D and E.
Metro Post Allocation Share(Column H) This column uses Metro funds final share of Phase 1 costs, as a percentage of total project costs, and applies it to costs included in Column C. This represents the actual share of costs based on the final allocation costs.
Amounts Subject to Interest (Column I) This column takes the difference between the initial splits for Metro (Column F) and the Metro post allocation share (Column H). These are the new expenditures from that fiscal year subject to the interest calculation.
Running Metro Balance Subject to This column takes any prior year balance in Column J, the prior year accrued interest in Column K and adds the new expenditures from Column I. This is the total balanced Interest (Column J) used to calculate each year's interest owed.
Yearly Interest Earnings (Column K) This column takes the annual interest earnings shown in Column M and assumed monthly compounding of Metro balance in Column J. Compounding period is consistent with the City's monthly interest earnings paid on City funds.
Estimated PA share (Column L) This column estimates the portion of interest earnings that is expected to be credited to the Participating Agencies. Individual Agencies will be credited during the audit following one year after the substantial completion of Pure Water Phase 1. Agencies will be credited at weighted average of costs from 2014 to one year after substantial completion of Phase 1, based on the PA's individual annual percent share of Metro costs.
Annual Interest Rate (Column M) This column shows the annual percent returns on funds invested by the City Treasurer. This is based on the Treasurers annual return on investments as invested under the City's investment policy. This is the rate used to calculate yearly interest owed.
Notes This calculator was designed to account for the time value of money related to (50/50 POs). If additional Phase 1item (CIP expenses, Revenue, etc.) need to account for the time value of money, the assumptions used in Columns I-K will remaining consistent in those calculations. Columns C through H and the associated percentages used will be adapted to fit the types of costs being allocated.
EXHIBIT A 105 July 7, 2026 Item 4
- 56 -
6-12-26
4932-3639-7490
EXHIBIT H
SUMMARY OF BILLINGS FROM COUNTY WATER AUTHORITY SHOWING COSTS
FOR UNTREATED WATER
EXHIBIT A 106 July 7, 2026 Item 4
Fixed Charges Total ($)
CWA Customer Service Charge $ 933,611.00
CWA Emergency Storage Charge $ 2,197,725.00
CWA Infrastructure Access Charge $ 1,760,089.00
CWA Supply Reliability Charge $ 1,504,825.00
Supply Charges Volume (AF) Rate ($/AF) Total ($)
CWA Forced Delivery - Untreated 231.3 $ 1,200.00 $ 277,560.00 CWA Regular Meter Delivery - Treated 2,069.2 $ 1,600.00 $ 3,310,720.00 CWA Regular Meter Delivery - Untreated 12,973.7 $ 1,200.00 $ 15,568,440.00 Subtotal 15,274.2 $ 19,156,720.00
CYTD Volume (AF)
46,134.1
17,627.4
129,500.4
193,261.9
Net Deliveries Current Month Volume (AF) Adjustment Volume (AF) CYTD Volume (AF)
Tier 1 Total Treated Water Delivered 2,081.1 17,964.3
Tier 1 Total Untreated Water Delivered 7,970.5 96,706.3 Tier 1 Usage 10,051.6 114,670.6
Water Exchanges Volume (AF) Rate($/AF) Total ($)
CWA Total To Other Agencies Untreated Water (5,285.0) $ 1,200.00 ($ 6,342,000.00) CWA Total From Other Agencies Treated Water 11.9 $ 1,600.00 $ 19,040.00 CWA Total From Other Agencies Untreated Water 50.5 $ 1,200.00 $ 60,600.00 Subtotal (5,222.6) ($ 6,262,360.00)
CYTD Volume (AF)
(79,483.9)
336.9
473.1
(78,673.9)
Subtotal 10,051.6 $ 1,899,752.40
Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Summary
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 1 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
Sample Bill from the County Water
Authority for all city of San Diego
Water purchases for the month of
December 2024 to provide clarity for
any sewer only providers. Additional
documentation will be provided at a
later date walking from this bill to the
purified water calculation
EXHIBIT A 107 July 7, 2026 Item 4
Fixed Charges Total ($)
MWD Capacity Reservation Charge $ 287,980.00
MWD Readiness-to-Serve Charge $ 406,779.00
Subtotal $ 7,091,009.00
Current Balance $ 21,885,121.40
Previous Balance $ 17,919,593.50
Total Due And Payable $ 39,804,714.90
REMIT TO:
SAN DIEGO COUNTY WATER AUTHORITY
4677 Overland Avenue
San Diego, CA 92123-1233
Payment is due on the last business day of the month and shall be delinquent if not received in investable funds by 2 p.m. of the tenth business day of the following month.
Delinquency charges are 1% of the total amount if paid within five business days of the delinquency, 2% thereafter. Reference San Diego County Water Authority Ordinance No. 2007-03 Revenue Collection Policy for a complete explanation of billing and payment for water deliveries.
Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Summary
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 2 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
Variable Charges Volume (AF) Rate($/AF) Total ($)
Transportation Charge - Meter Delivery 15,274.2 $ 189.00 $ 2,886,823.80 Transportation Charge - Water Exchange (5,222.6) $ 189.00 ($ 987,071.40) Variable Charges Volume (AF) Rate($/AF) Total ($)
Transportation Charge - Meter Delivery 15,274.2 $ 189.00 $ 2,886,823.80 Transportation Charge - Water Exchange (5,222.6) $ 189.00 ($ 987,071.40) EXHIBIT A 108 July 7, 2026 Item 4
Supply Charges
CWA
Forced Delivery - Untreated
Meter No Begin Read End Read 1000 CU. FT. AC. FT. Rate($/AF) Dollars($) Over Weir,WEIR 248,532 248,761 228 5.2 $ 1,200.00 $ 6,240.00 San Diego,02 2,012,753 2,022,602 9,849 226.1 $ 1,200.00 $ 271,320.00 Untreated Water Subtotal 231.3 $ 277,560.00
Regular Meter Delivery - Treated
Meter No Begin Read End Read 1000 CU. FT. AC. FT. Rate($/AF) Dollars($) San Diego, 27 197,491 210,099 12,609 289.5 $ 1,600.00 $ 463,200.00 San Diego, 30 3,079 3,080 2 0.0 $ 1,600.00 $ 0.00
San Diego,10 3,300,807 3,316,240 15,433 354.3 $ 1,600.00 $ 566,880.00 San Diego,11 11,413,060 11,461,025 47,966 1,101.1 $ 1,600.00 $ 1,761,760.00 San Diego,14 5,034,606 5,046,789 12,183 279.7 $ 1,600.00 $ 447,520.00 San Diego,15 3,837,922 3,839,738 1,816 41.7 $ 1,600.00 $ 66,720.00 SD 18/21 Bypass,
18/21 B/P 7,490 7,616 127 2.9 $ 1,600.00 $ 4,640.00
Treated Water Subtotal 2,069.2 $ 3,310,720.00
Regular Meter Delivery - Untreated
Meter No Begin Read End Read 1000 CU. FT. AC. FT. Rate($/AF) Dollars($) Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Detail
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 3 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
EXHIBIT A 109 July 7, 2026 Item 4
Water Exchanges
CWA
To Other Agencies Untreated Water
Exchange Location To Agency AC. FT. Rate($/AF) Dollars($) Comments DCFSV66 San Diego County Water Authority (4,974.8) $ 1,200.00 ($ 5,969,760.00) credit for no purchase Del Mar (NA) Del Mar, City of (78.9) $ 1,200.00 ($ 94,680.00) San Vicente Acct San Diego County Water Authority (231.3) $ 1,200.00 ($ 277,560.00) To Other Agencies Untreated Water Subtotal (5,285.0) ($ 6,342,000.00) Supply Charges
CWA
Leakage (SD-1),01 0 31 540 12.4 $ 1,200.00 $ 14,880.00
San Diego, 28 7,377,561 7,443,701 66,141 1,518.4 $ 1,200.00 $ 1,822,080.00 San Diego, DCFSV66 1,434,378 1,651,079 216,701 4,974.8 $ 1,200.00 $ 5,969,760.00 San Diego,05A 9,627,449 9,733,405 105,956 2,432.4 $ 1,200.00 $ 2,918,880.00 San Diego,05B 8,808,476 8,932,713 124,237 2,852.1 $ 1,200.00 $ 3,422,520.00 San Diego,05C 1,405,570 1,428,831 23,261 534.0 $ 1,200.00 $ 640,800.00 San Diego,06A 2,967,595 2,969,351 1,756 40.3 $ 1,200.00 $ 48,360.00 San Diego,06B WEIR 1,591,412 1,591,432 20 0.5 $ 1,200.00 $ 600.00 San Diego,20 11,002,113 11,028,633 26,520 608.8 $ 1,200.00 $ 730,560.00 Untreated Water Subtotal 12,973.7 $ 15,568,440.00
Supply Charges Subtotal 15,274.2 $ 19,156,720.00
Supply Charges Total 15,274.2 $ 19,156,720.00
Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Detail
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 4 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
EXHIBIT A 110 July 7, 2026 Item 4
Variable Charges
Transportation Charge - Meter Delivery
Meter No./Location AC. FT. Rate($/AF) Dollars($) Comments Leakage (SD-1),01 12.4 $ 189.00 $ 2,343.60
Over Weir,WEIR 5.2 $ 189.00 $ 982.80
San Diego, 27 289.5 $ 189.00 $ 54,715.50
San Diego, 28 1,518.4 $ 189.00 $ 286,977.60
San Diego, 30 0.0 $ 189.00 $ 0.00
San Diego, DCFSV66 4,974.8 $ 189.00 $ 940,237.20
Water Exchanges
CWA
From Other Agencies Treated Water
Exchange Location From Agency AC. FT. Rate($/AF) Dollars($) Comments El Camino Real Santa Fe I.D. 1.0 $ 1,600.00 $ 1,600.00
Highland Ct. Santa Fe I.D. 0.2 $ 1,600.00 $ 320.00
Otay TP Otay W.D. 10.7 $ 1,600.00 $ 17,120.00
From Other Agencies Treated Water Subtotal 11.9 $ 19,040.00 From Other Agencies Untreated Water
Exchange Location From Agency AC. FT. Rate($/AF) Dollars($) Comments Fletcher Well Helix W.D. 50.5 $ 1,200.00 $ 60,600.00
From Other Agencies Untreated Water Subtotal 50.5 $ 60,600.00 Water Exchanges Subtotal (5,222.6) ($ 6,262,360.00)
Water Exchanges Total (5,222.6) ($ 6,262,360.00)
Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Detail
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 5 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
EXHIBIT A 111 July 7, 2026 Item 4
Variable Charges
San Diego,02 226.1 $ 189.00 $ 42,732.90
San Diego,05A 2,432.4 $ 189.00 $ 459,723.60
San Diego,05B 2,852.1 $ 189.00 $ 539,046.90
San Diego,05C 534.0 $ 189.00 $ 100,926.00
San Diego,06A 40.3 $ 189.00 $ 7,616.70
San Diego,06B WEIR 0.5 $ 189.00 $ 94.50
San Diego,10 354.3 $ 189.00 $ 66,962.70
San Diego,11 1,101.1 $ 189.00 $ 208,107.90
San Diego,14 279.7 $ 189.00 $ 52,863.30
San Diego,15 41.7 $ 189.00 $ 7,881.30
San Diego,20 608.8 $ 189.00 $ 115,063.20
SD 18/21 Bypass, 18/21 B/P 2.9 $ 189.00 $ 548.10
Transportation Charge - Meter Delivery Subtotal 15,274.2 $ 2,886,823.80 Transportation Charge - Water Exchange
Meter No./Location AC. FT. Rate($/AF) Dollars($) Comments DCFSV66 (4,974.8) $ 189.00 ($ 940,237.20) credit for no purchase Del Mar (NA) (78.9) $ 189.00 ($ 14,912.10)
El Camino Real 1.0 $ 189.00 $ 189.00
Fletcher Well 50.5 $ 189.00 $ 9,544.50
Highland Ct. 0.2 $ 189.00 $ 37.80
Otay TP 10.7 $ 189.00 $ 2,022.30
San Vicente Acct (231.3) $ 189.00 ($ 43,715.70)
Transportation Charge - Water Exchange Subtotal (5,222.6) ($ 987,071.40) Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Detail
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 6 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
EXHIBIT A 112 July 7, 2026 Item 4
Fixed Charges
CWA
Customer Service Charge Annual ($) Monthly ($)
Annual Customer Service Charge for Calendar Year 2024 $ 11,203,332.00 Customer Service Charge December $ 933,611.00
Emergency Storage Charge Annual ($) Monthly ($)
Annual Emergency Storage Charge for Calendar Year 2024 $ 26,372,700.00 Emergency Storage Charge December $ 2,197,725.00
Infrastructure Access Charge Annual ($) Monthly ($)
Annual Infrastructure Access Charge for Calendar Year 2024 $ 21,121,068.00 Infrastructure Access Charge December $ 1,760,089.00
Supply Reliability Charge Annual ($) Monthly ($)
Annual Supply Reliability Charge for Calendar Year 2024 $ 18,057,900.00 Supply Reliability Charge December $ 1,504,825.00
MWD
Capacity Reservation Charge Annual ($) Monthly ($)
Annual Capacity Reservation Charge for Calendar Year 2024 $ 3,455,760.00 Capacity Reservation Charge December $ 287,980.00
Readiness-to-Serve Charge Annual ($) Monthly ($)
Annual Readiness-to-Serve Charge for Fiscal Year 2025 $ 4,881,348.00 Readiness-to-Serve Charge December $ 406,779.00
Fixed Charges Subtotal $ 7,091,009.00
Current Balance $ 21,885,121.40
Previous Balance $ 17,919,593.50
Total Due And Payable $ 39,804,714.90
Variable Charges Subtotal 10,051.6 $ 1,899,752.40
Variable Charges Total 10,051.6 $ 1,899,752.40
Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Detail
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 7 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
EXHIBIT A 113 July 7, 2026 Item 4
REMIT TO:
SAN DIEGO COUNTY WATER AUTHORITY
4677 Overland Avenue
San Diego, CA 92123-1233
Payment is due on the last business day of the month and shall be delinquent if not received in investable funds by 2 p.m. of the tenth business day of the following month.
Delinquency charges are 1% of the total amount if paid within five business days of the delinquency, 2% thereafter. Reference San Diego County Water Authority Ordinance No. 2007-03 Revenue Collection Policy for a complete explanation of billing and payment for water deliveries.
Generated Date: 01/10/2025 11:21 AM
19-6364
A Public Agency
4677 Overland Avenue, San Diego, California, 92123-1233 (858) 522-6673 FAX (858) 522-6561
December 2024
Invoice Detail
Billed to:
San Diego, City of
Mailed: 1/10/2025 Due Date: 2/14/2025
Invoice Number: 1224-15 Page 8 of 8
Service Address:
2797 Caminito Chollas
San Diego, CA 92105-
EXHIBIT A 114 July 7, 2026 Item 4
- 57 -
6-12-26
4932-3639-7490
EXHIBIT I
LIST OF ADMINISTRATIVE AGREEMENTS
NO. TITLE EFFECTIVE
DATE
AMENDMEN
T DATE
1. Agreement Between City of San Diego and
Participating Agencies in the Metropolitan Sewerage
System for Unified Management of Industrial Waste
Discharge Pretreatment and Enhanced Source
Control Programs
2. EXHIBIT A 115 July 7, 2026 Item 4
- 58 -
6-12-26
4932-3639-7490
EXHIBIT J
SAMPLE FAB CALCULATION
ILLUSTRATIVE EXAMPLE:
FY 2024 AND POST FY 2027
FUNCTIONAL ALLOCATED BILLING (FAB)
DISTRIBUTION OF
METRO WASTEWATER SYSTEM TOTAL COSTS
EXHIBIT A 116 July 7, 2026 Item 4
TABLE A: EXAMPLE 2024 FAB DISTRIBUTION OF METRO WASTEWATER SYSTEM TOTAL COSTS
OWNERSHIP
AGENCY
Average Flow,
MGD
Incremental Peak Flow,
MGD
RSDP,
MGD
TSS,
1,000 lbs.
COD,
1,000 lbs. Pure Water Phase 1
Unit Cost $160,947 $67,220 $0 $123 $17 $14,035,210
Chula Vista $2,950,163 10% $1,312,269 8% $0 0% $2,709,139 11% $638,388 $1,641,933 12% Coronado $305,800 1% $203,680 1% $0 0% $256,267 1% $55,428 $161,744 1% Del Mar $0 0% $20,166 0% $0 0% $0 0% $0 $2,789 0%
East Otay Mesa $287,774 1% $234,061 1% $0 0% $234,962 1% $55,427 $153,843 1% El Cajon $1,255,389 4% $1,345,963 8% $0 0% $1,498,185 6% $287,760 $69,733 0% Imperial Beach $398,023 1% $300,738 2% $0 0% $250,850 1% $63,881 $198,036 1% La Mesa $850,815 3% $1,606,991 10% $0 0% $572,743 2% $160,116 $396,205 3% Lakeside/Alpine $609,361 2% $112,258 1% $0 0% $514,773 2% $121,832 $21,464 0% Lemon Grove $386,273 1% $303,056 2% $0 0% $280,774 1% $72,899 $195,821 1% National City $748,405 3% $206,568 1% $0 0% $559,705 2% $152,221 $400,266 3% Otay $61,160 0% $38,273 0% $0 0% $120,737 0% $13,878 $64,182 0% Padre Dam $400,759 1% $439,621 3% $0 0% $1,051,084 4% $167,951 $62,343 0% Poway $499,097 2% $591,194 4% $0 0% $381,951 2% $84,300 $262,248 2% Spring Valley $1,002,862 3% $306,603 2% $0 0% $803,788 3% $191,022 $528,429 4% Wintergardens $142,827 0% $72,598 0% $0 0% $136,597 1% $27,243 $6,196 0% SUBTOTAL $9,898,708 33% $7,094,038 44% $0 0% $9,371,554 37% $2,092,345 $4,165,233 30% San Diego
SD Wastewater $19,965,508 67% $9,152,721 56% $0 0% $15,953,330 63% $4,200,992 $9,869,977 70% SD Water $0 0% $0 0% $0 0% $0 0% $0 $0 0%
SUBTOTAL $19,965,508 67% $9,152,721 56% $0 0% $15,953,330 63% $4,200,992 $9,869,977 70% Regional Sludge $0 0.00 $0 0.00 $0 0.00 $0 0.00 $0
TOTAL $29,864,216 100% $16,246,760 100% $0 0% $25,324,885 100% $6,293,337 $14,035,210 100% *Based on FY 2024 Metro System expenses as of last available data, March 20, 2025 *2024 billed units based on Exhibit B & use estimates developed as part of FAB & SARA creation process. 2024 units do not represent the actual billed flows and loadings form FY 2024, but rather are the same as the 2027 units with the exception of the East County agencies and the City of San Diego whose billed units are assumed to change post-2027. Focus of the analysis is to compare the changes in bills due to the change in flows and loadings after 2027 as a result of San Diego and East County Pure Water programs EXHIBIT J - FY 2024
EXHIBIT A 117 July 7, 2026 Item 4
USE
AGENCY
Metered Flow,
MGD
RSDP,
MGD
TSS,
1,000 lbs.
COD,
1,000 lbs. TOTAL % of Total
Unit Cost $692,178 $0 $561 $120
Chula Vista $12,469,072 11% $0 0% $10,048,689 12% $4,565,526 12% $ 36,335,178 11% Coronado $1,043,278 1% $0 0% $889,552 1% $324,301 1% $ 3,240,049 1% Del Mar -$4,292 0% $0 0% -$3,496 0% -$1,108 0% $ 14,059 0% East Otay Mesa $201,189 0% $0 0% $138,032 0% $65,154 0% $ 1,370,441 0% El Cajon $5,822,210 5% $0 0% $5,252,268 6% $2,050,847 5% $ 17,582,355 5% Imperial Beach $1,635,544 1% $0 0% $1,192,406 1% $504,382 1% $ 4,543,860 1% La Mesa $3,243,976 3% $0 0% $1,500,928 2% $692,016 2% $ 9,023,790 3% Lakeside/Alpine $2,558,395 2% $0 0% $1,883,109 2% $910,190 2% $ 6,731,381 2% Lemon Grove $1,507,949 1% $0 0% $625,924 1% $303,769 1% $ 3,676,465 1% National City $2,892,939 2% $0 0% $1,995,264 2% $973,714 3% $ 7,929,082 2% Otay $202,861 0% $0 0% $463,478 1% $92,973 0% $ 1,057,542 0% Padre Dam $1,925,768 2% $0 0% $3,117,893 4% $880,795 2% $ 8,046,214 2% Poway $1,965,607 2% $0 0% $906,717 1% $435,731 1% $ 5,126,846 2% Spring Valley $3,844,185 3% $0 0% $2,564,363 3% $1,202,187 3% $ 10,443,439 3% Wintergardens $688,072 1% $0 0% $530,720 1% $246,761 1% $ 1,851,013 1% SUBTOTAL $39,996,753 34% $0 0% $31,105,847 37% $13,247,238 34% $ 116,971,715 35% San Diego
SD Wastewater $78,078,006 66% $0 0% $52,296,287 63% $25,327,225 66% $ 214,844,047 65% SD Water $0 0% $0 0% $0 0% $0 0% $ - 0%
SUBTOTAL $78,078,006 66% $0 0% $52,296,287 63% $25,327,225 66% $ 214,844,047 65% Regional Sludge $0 0% $0 0% $0 0.00 $0 0.00 $ - 0%
TOTAL $118,074,759 100% $0 0% $83,402,134 100% $38,574,463 100% $ 331,815,762 100% *Based on FY 2024 Metro System expenses as of last available data, March 20, 2025 *2024 billed units based on Exhibit B & use estimates developed as part of FAB & SARA creation process. 2024 units do not represent the actual billed flows and loadings form FY 2024, but rather are the same as the 2027 units with the exception of the East County agencies and the City of San Diego whose billed units are assumed to change post-2027. Focus of the analysis is to compare the changes in bills due to the change in flows and loadings after 2027 as a result of San Diego and East County Pure Water programs EXHIBIT J - FY 2024 (CONTINUED)
TABLE B: EXAMPLE 2024 FAB DISTRIBUTION OF METRO WASTEWATER SYSTEM TOTAL COSTS EXHIBIT A 118 July 7, 2026 Item 4
TABLE C: EXAMPLE POST-2027 FAB DISTRIBUTION OF METRO WASTEWATER SYSTEM TOTAL COSTS
OWNERSHIP
AGENCY
Average Flow,
MGD
Peak Flow,
MGD
RSDP,
MGD
TSS,
1,000 lbs.
COD,
1,000 lbs. Pure Water Phase 1
Unit Cost $172,597 $67,944 $12,948 $138 $18 $14,035,210 Chula Vista $3,163,707 11% $1,326,405 8% $0 0% $3,056,672 12% $699,281 $1,641,933 12% Coronado $327,935 1% $205,874 1% $0 0% $289,141 1% $60,715 $161,744 1% Del Mar $0 0% $20,383 0% $0 0% $0 0% $0 $2,789 0%
East Otay Mesa $308,604 1% $236,583 1% $0 0% $265,104 1% $60,714 $153,843 1% El Cajon $222,650 1% $1,354,134 8% $7,795 4% $303,984 1% $55,551 $69,733 0% Imperial Beach $426,833 1% $304,657 2% $0 0% $283,029 1% $69,974 $198,036 1% La Mesa $912,400 3% $1,623,623 10% $0 0% $646,216 3% $175,388 $396,205 3% Lakeside/Alpine $12,082 0% $113,467 1% $4,014 2% $32,945 0% $5,333 $21,464 0% Lemon Grove $414,233 1% $306,321 2% $0 0% $316,792 1% $79,852 $195,821 1% National City $802,577 3% $208,793 1% $0 0% $631,505 2% $166,740 $400,266 3% Otay $65,587 0% $38,685 0% $0 0% $136,226 1% $15,201 $64,182 0% Padre Dam $75,943 0% $444,357 3% $4,713 2% $87,485 0% $16,199 $62,343 0% Poway $535,224 2% $598,242 4% $0 0% $430,948 2% $92,341 $262,248 2% Spring Valley $990,708 3% $343,267 2% $0 0% $835,989 3% $192,882 $528,429 4% Wintergardens $3,452 0% $73,380 0% $1,036 1% $8,998 0% $1,456 $6,196 0% SUBTOTAL $8,261,935 28% $7,198,171 44% $17,558 9% $7,325,034 29% $1,691,630 $4,165,233 30% San Diego
SD Wastewater $21,410,950 72% $9,251,313 56% $0 0% $17,999,850 71% $4,601,706 $9,869,977 70% SD Water $0 0% $0 0% $185,160 91% $0 0% $0 $0 0%
SUBTOTAL $21,410,950 72% $9,251,313 56% $185,160 91% $17,999,850 71% $4,601,706 $9,869,977 70% Regional Sludge $0 0.00 $0 0.00 $0 0.00 $0 0.00 $0
TOTAL $29,672,885 100% $16,449,484 100% $202,718 100% $25,324,885 100% $6,293,337 $14,035,210 100% *Based on FY 2024 Metro System expenses as of last available data, March 20, 2025 *2024 billed units based on Exhibit B & use estimates developed as part of FAB & SARA creation process. 2024 units do not represent the actual billed flows and loadings form FY 2024, but rather are the same as the 2027 units with the exception of the East County agencies and the City of San Diego whose billed units are assumed to change post-2027. Focus of the analysis is to compare the changes in bills due to the change in flows and loadings after 2027 as a result of San Diego and East County Pure Water programs EXHIBIT J - POST FY 2027
EXHIBIT A 119 July 7, 2026 Item 4
USE
AGENCY
Metered Flow,
MGD
RSDP,
MGD
TSS,
1,000 lbs.
COD,
1,000 lbs. TOTAL % of Total
Unit Cost $731,597 $194,605 $492 $120
Chula Vista $12,783,094 11% $0 0% $10,354,251 12% $4,398,500 11% $ 37,423,843 11% Coronado $1,005,540 1% $0 0% $743,279 1% $289,814 1% $ 3,084,041 1% Del Mar $0 0% $0 0% $0 0% $0 0% $ 23,172 0%
East Otay Mesa $206,276 0% $0 0% $148,557 0% $63,175 0% $ 1,442,856 0% El Cajon $724,109 1% $58,382 4% $843,730 1% $284,766 1% $ 3,924,834 1% Imperial Beach $1,706,929 1% $0 0% $948,898 1% $435,622 1% $ 4,373,980 1% La Mesa $3,683,276 3% $0 0% $2,187,040 3% $1,102,207 3% $ 10,726,356 3% Lakeside/Alpine $39,441 0% $31,137 2% $89,152 0% $26,555 0% $ 375,590 0% Lemon Grove $1,358,771 1% $0 0% $871,176 1% $407,758 1% $ 3,950,724 1% National City $3,061,864 3% $0 0% $2,019,790 2% $990,269 3% $ 8,281,804 2% Otay $313,573 0% $0 0% $546,022 1% $113,139 0% $ 1,292,615 0% Padre Dam $40,801 0% $35,029 3% $92,226 0% $27,471 0% $ 886,568 0% Poway $1,886,688 2% $0 0% $1,273,560 2% $506,725 1% $ 5,585,975 2% Spring Valley $3,301,611 3% $0 0% $2,334,121 3% $999,997 3% $ 9,527,005 3% Wintergardens $14,632 0% $7,784 1% $31,974 0% $9,608 0% $ 158,517 0% SUBTOTAL $30,126,604 26% $132,332 10% $22,483,777 27% $9,655,607 25% $ 91,057,881 27% San Diego
SD Wastewater $86,434,079 74% $0 0% $60,918,357 73% $28,918,856 75% $ 239,405,089 72% SD Water $0 0% $1,167,632 90% $0 0% $0 0% $ 1,352,792 0% SUBTOTAL $86,434,079 74% $1,167,632 90% $60,918,357 73% $28,918,856 75% $ 240,757,881 73% Regional Sludge $0 0% $0 0% $0 0.00 $0 0.00 $ - 0%
TOTAL $116,560,684 100% $1,299,963 100% $83,402,134 100% $38,574,463 100% $ 331,815,762 100% *Based on FY 2024 Metro System expenses as of last available data, March 20, 2025 *2024 billed units based on Exhibit B & use estimates developed as part of FAB & SARA creation process. 2024 units do not represent the actual billed flows and loadings form FY 2024, but rather are the same as the 2027 units with the exception of the East County agencies and the City of San Diego whose billed units are assumed to change post-2027. Focus of the analysis is to compare the changes in bills due to the change in flows and loadings after 2027 as a result of San Diego and East County Pure Water programs TABLE D: EXAMPLE POST-2027 FAB DISTRIBUTION OF METRO WASTEWATER SYSTEM TOTAL COSTS EXHIBIT J -POST FY 2027 (CONTINUED)
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EXHIBIT K
EXHIBIT LIST
Exhibit Name Amended Date
A
Metro Facilities (Electronic Exhibit); file name: 2025-10_Exhibit A Metro Facilities.aprx; time stamp of file: 10/23/2025 3:38 PM, software used to open and view file including version: ArcGIS Pro 3.5.0; included herewith as CD-ROM/DVD-ROM
B Distribution of Wastewater System Capacity Rights
C Administrative Protocol on Allocation of Operating Reserves and Debt Service Coverage to Participating Agencies
D Notice Listing
E Methodology for Contract Capacity Transfers
F Metro System Flow Formulas and Sampling Locations
G Sample of Interest Calculation
H Summary of Billings from County Water Authority Showing Costs for Untreated Water
I List of Administrative Agreements
J Sample FAB Calculation
K Exhibit List
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SECOND AMENDED AND RESTATED
REGIONAL WASTEWATER DISPOSAL AGREEMENT
BETWEEN
THE CITY OF SAN DIEGO
AND
THE PARTICIPATING AGENCIES
IN
THE METROPOLITAN SEWERAGE SYSTEM
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TABLE OF CONTENTS
Page
1. DEFINITIONS .................................................................................................................... 3
2. OWNERSHIP AND OPERATION OF THE METRO SYSTEM ...................................... 9
2.1 Rights of the Parties ................................................................................................ 9
2.2 Metro System Services ....................................................................................... 109
2.3 Flow Commitment ................................................................................................ 10
2.4 Funding Obligations........................................................................................... 1110
2.5 Limitations on Types and Condition of Wastewater ............................................. 11
2.6 Enforcement Actions ...................................................................................... 121112
2.7 Right of First Refusal ........................................................................................ 1413
2.8 Uniform Enforcement of Pretreatment Program by City .................................. 1514
2.9 Wastewater Generated at Military Bases .............................................................. 16
3. CAPACITY RIGHTS .................................................................................................... 1716
3.1 Contract Capacity.............................................................................................. 1716
3.2 Inter-Agency Transfers of Contract Capacity ............................................... 171617
3.3 New Contract Capacity ................................................................................. 181718
3.4 Reductions in Metro System Capacity .................................................................. 18
3.5 Restrictions on Veto of Transfers and Acquisitions of Capacity ........................... 18
3.6 Amendments to Exhibits B ............................................................................... 1918
3.7 The South Bay Ocean Outfall ....................................................................... 191819
4. FINANCE, BUDGETING, AND ACCOUNTING: PAYMENT AND MONITORING PROVISIONS ........................................................................................................... 191819
4.1 Payment for Metro System Facilities ............................................................ 191819
4.2 Payment for Additional Metro System Facilities .................................................. 19
4.3 Payment for Operation and Maintenance ......................................................... 2019
4.4 Charges Based on Flow, Strength and Fixed Capacity: Exception ............... 201920
4.5 Monitoring Flow and Strength .............................................................................. 21
5. FINANCE, BUDGETING, AND ACCOUNTING: SYSTEM OF CHARGES............... 22
5.1 Charges Authorized ............................................................................................... 22
5.2 Functional Allocated Billing (FAB) ...................................................................... 22
5.3 Metro System Costs .......................................................................................... 2423
5.4 Excluded Costs.................................................................................................. 2423
5.5 Metro System Revenues and Allocations ..................................................... 242324
5.6 Excluded Revenue ............................................................................................ 2524
5.7 Estimate and Billing Schedule and Year End Adjustment ................................ 2524
5.8 Financial Statements ......................................................................................... 2625
5.9 Debt Financing .............................................................................................. 262526
5.10 Allocation of Operating Reserves and Debt Service Coverage ........................ 2726
5.11 Amending the System of Charges ..................................................................... 2726 ATTACHMENT B 123 July 7, 2026 Item 4
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6. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 1 .......................................................... 2726
6.1 North City Water Reclamation Plant Modification ........................................... 2726
6.2 New, Expanded or Modified Metro System Facilities ...................................... 2726
6.3 Costs Excluded from Metro System Costs – Phase 1 ................................... 272627
6.4 North City Water Reclamation Plant Improvement Costs Included as Metro System Costs ..................................................................................................... 2827
6.5 Reallocation of PWP Costs incurred since FY 2014 .................................... 282728
6.6 Revenue Sharing for Repurified Water ......................................................... 292829
6.7 Capital Expense Rate ........................................................................................ 3130
6.8 Amending Pure Water Program Cost Allocation and Revenues – Phase 1 .. 333233
7. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 2 ...................................................... 343234
7.1 Pure Water Program – Phase 2 ...................................................................... 343234
7.2 Costs Excluded As Metro System Costs ....................................................... 343234
7.3 Revenue Sharing for Repurified Water – Phase 2 ......................................... 343334
7.4 Capital Expense Rate – Phase 2 .................................................................... 353335
8. FUTURE NEGOTIATIONS AND COOPERATION ................................................... 3534
9. THE METRO COMMISSION ..................................................................................... 3534
9.2 Advisory Responsibilities of Metro JPA ....................................................... 363436
9.3 Delegation of Decision-Making Authority of the Metro JPA ........................... 3635
9.4 Standing ............................................................................................................ 3635
10. DISPUTE RESOLUTION ............................................................................................ 3635
10.1 Mandatory Non-Binding Mediation ............................................................. 363536
10.2 Selection of Mediator .................................................................................... 373537
10.3 Mediation Expenses ...................................................................................... 373537
10.4 Conduct of Mediation ................................................................................... 373537
10.5 Mediation Results ............................................................................................. 3736
10.6 Performance Required During Dispute ............................................................. 3736
11. INSURANCE ................................................................................................................ 3736
11.1 City Shall Maintain All Required Insurance ..................................................... 3736
11.2 Substantially Equivalent Coverage ............................................................... 383638
12. INTERRUPTION OF SERVICE .............................................................................. 383638
13. NOTICES REQUIRED UNDER AGREEMENT ........................................................ 3837
14. EFFECTIVE DATE AND EXPIRATION .................................................................... 3837
14.1 Effective Date ................................................................................................... 3837
14.2 Expiration ...................................................................................................... 393739
14.3 Contract Capacity Rights Survive Expiration ............................................... 393739
14.4 Abandonment .................................................................................................... 3938 ATTACHMENT B 124 July 7, 2026 Item 4
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15. ADMINISTRATIVE AGREEMENTS ......................................................................... 3938
15.1 Use and Process for Administrative Agreements .............................................. 3938
16. GENERAL ................................................................................................................ 413941
16.1 Exhibits ......................................................................................................... 413941
16.2 Electronic Exhibits and Attachments ............................................................ 413941
16.3 Amendments to Agreement ........................................................................... 424042
16.4 Construction of Agreement ............................................................................... 4443
16.5 Declarations Re: Agreement ............................................................................. 4644
16.6 Right to Make Other Agreements ................................................................. 464446
16.7 Statute of Limitations to Resolve Billing Issues ........................................... 464446
16.8 Counterparts and Electronic Signatures ............................................................ 4745
16.9 Transparency ................................................................................................. 474547
16.10 Incorporation of Recitals ............................................................................... 474547
16.11 Joint Exercise of Power ................................................................................ 474547 ACRONYM LIST:
ARA Amended and Restated Regional Wastewater Disposal Agreement COD Chemical Oxygen Demand
CIP Capital Improvement Project(s)
CPM Construction Project Management
CWA San Diego County Water Authority
ECAWP JPA East County Advanced Water Purification Joint Powers Authority FAB Functional Allocated Billing
MBC Metropolitan Biosolids Center
MGD Millions of Gallons per Day
NCWRP North City Water Reclamation Plant
NPDES National Pollutant Discharge Elimination System
PLWTP Point Loma Wastewater Treatment Plant
PWP Pure Water Program
RSDP Reject Stream from Demineralization Process
SBOO South Bay Ocean Outfall
SBWRP South Bay Water Reclamation Plant
TSS Total Suspended Solids
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SECOND AMENDED AND RESTATED REGIONAL WASTEWATER DISPOSAL
AGREEMENT
THIS SECOND AMENDED AND RESTATED REGIONAL WASTEWATER
DISPOSAL AGREEMENT (“Agreement”) is made and entered into this ___1st day of ______________, 20___,July, 2026, by and between the CITY OF SAN DIEGO, a municipal corporation (the “City”), on the one hand; and the CITY OF CHULA VISTA, a municipal corporation; the CITY OF CORONADO, a municipal corporation; the CITY OF DEL MAR, a municipal corporation; the CITY OF EL CAJON, a municipal corporation; the CITY OF IMPERIAL BEACH, a municipal corporation; the CITY OF LA MESA, a municipal corporation; the LEMON GROVE SANITATION DISTRICT, a political subdivision of the State of California; the CITY OF NATIONAL CITY, a municipal corporation; the CITY OF POWAY, a municipal corporation; the OTAY WATER DISTRICT, a political subdivision of the State of California; the PADRE DAM MUNICIPAL WATER DISTRICT, a political subdivision of the State of California; and the SAN DIEGO COUNTY SANITATION DISTRICT, a political subdivision of the State of California (collectively, the “Participating Agencies”), on the other hand. The City and the Participating Agencies may be referred to herein individually as a “Party,” and collectively as the “Parties.”
RECITALS
WHEREAS, the City and the Participating Agencies (or their predecessors in interest) entered into that certain Regional Wastewater Disposal Agreement dated May 18, 1998 (the “1998 Agreement”), which provided, among other things, for certain contract rights to capacity in the Metropolitan Sewerage System, a system of wastewater conveyance, treatment, and disposal facilities (“Metro System”) and the establishment of a mechanism to fund the planning, design, construction, operation, and maintenance of the Metro System by the City and the Participating Agencies; and
WHEREAS, the purposes of the 1998 Agreement were: (1) to replace the prior-existing sewage disposal agreements between the City and the Participating Agencies; (2) to provide certain contract rights to capacity in the Metro System to the Participating Agencies; (3) to establish a mechanism to fund the planning, design, construction, operation and maintenance of the Metro System by the City and the Participating Agencies as necessary to provide hydraulic capacity, and to comply with applicable law and with generally accepted engineering practices; and (4) to establish a system of charges which allocates the costs of the planning, design and construction of such new wastewater conveyance, treatment and disposal facilities as are necessary solely to provide for new capacity on a fair and equitable basis; and WHEREAS, on April 29, 2014 the San Diego City Council gave its approval and support for the Pure Water San Diego program by adoption of Resolution No. R-308906, which approved and supported the City’s efforts to develop an implementation strategy to offload wastewater flow from the Point Loma Wastewater Treatment Plant through implementation of potable reuse, resulting in effluent discharged to the Pacific Ocean being equivalent to what would be achieved by upgrading the Point Loma Wastewater Treatment Plant to a secondary treatment plant (secondary equivalency); and
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WHEREAS, the City is implementing a phased, multi-year program designed to achieve compliance with the Clean Water Act and regionally produce up to 83 million gallons per day of safe, reliable potable water using new, expanded, or modified facilities, some of which will include Metro System facilities, in order to achieve secondary equivalency at the Point Loma Wastewater Treatment Plant; and
WHEREAS, the Pure Water Program will not only benefit the City by producing repurified water, but also the Participating Agencies and their wastewater customers, especially if secondary equivalency is recognized through federal legislation amending the Clean Water Act. Specifically, implementation of the Pure Water Program will reduce wastewater discharges to the Point Loma Wastewater Treatment Plant, part of the Metro System where a large portion of the Participating Agencies’ wastewater is currently treated and disposed by discharging it into the Pacific Ocean.
By diverting wastewater from the Point Loma Wastewater Treatment Plant and reducing the effluent discharged into the Pacific Ocean, the City and the Participating Agencies will potentially avoid billions of dollars in unnecessary capital, financing, energy, and operating costs to upgrade the Point Loma plant to secondary treatment at full capacity. Avoiding such costs would result in significant savings for regional wastewater customers and achieve environmental benefits by reducing ocean discharge; and
WHEREAS, on or around November 2019, the East County Advanced Water Purification Joint Powers Authority (the “ECAWP JPA”) was created to implement a potable reuse program to improve local and regional water supply reliability to supply advanced treated recycled water to East San Diego County through the East County Advanced Water Purification Project (the “ECAWP Project”). The ECAWP Project is planned to capture and treat approximately 15 million gallons per day of wastewater that would otherwise be disposed of in the Metro System to produce an annual average supply of approximately 11.5 million gallons per day of new local drinking water. By diverting some wastewater and wastewater content away from the Metro System, the ECAWP Project has the ability to aid and contribute towards the City and region’s efforts to produce a regional annual average of up to 83 million gallons per day of water suitable for potable reuse by December 31, 2035, as described in the Cooperative Agreement in Support of Pure Water San Diego executed by the City and certain environmental stakeholders on December 9, 2014.
The ECAWP Project includes a residuals bypass system that will convey RSDP (as defined herein) from the advanced water purification facility, and Centrate from the solids dewatering process of the solids handling facility, to an existing regional sewage gravity pipeline owned and operated by the City for treatment and disposal; and
WHEREAS, effective on or around August 22, 2021, the City and the Participating Agencies amended the 1998 Agreement by executing an Amended and Restated Regional Wastewater Disposal Agreement (the “ARA”) to address the costs and revenues associated with Phase 1 of the Pure Water Program, including specific cost allocations related to the construction, expansion, and/or modification of Metro System facilities and Water Repurification System facilities designed to produce up to 30 million gallons per day of Repurified Water (“Phase 1”).
The ARA provided that within one year of its effective date, the Parties intended to meet and negotiate in good faith regarding one or more amendments to the ARA or to its Exhibits to address multiple outstanding items described in Section 2.9 of the ARA; and ATTACHMENT B 127 July 7, 2026 Item 4
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WHEREAS, Section 14.2 of the ARA provided that the Parties may amend the ARA by a written agreement between the City and all Participating Agencies stating the Parties’ intent to amend or supplement the agreement; and
WHEREAS, in an effort to address in good faith the outstanding items described in Section 2.9 of the ARA, and comprehensively and equitably address the costs, revenues, and billing system associated with the Pure Water Program and the related construction, expansion, and/or modification of Metro System facilities beyond Phase 1, the City and Participating Agencies wish to amend and restate the ARA as provided herein.
NOW, THEREFORE, in consideration of the mutual promises set forth in this Agreement, the City and the Participating Agencies restate and amend the ARA and agree as follows:
1. DEFINITIONS
1.1 Administrative Agreement shall refer to a formal binding contract, approved under the process set forth in Section 15 of this Agreement, which implements technical, administrative, operational, and/or procedural details of this Agreement.
1.2 Administrative Approval is an approval mechanism authorized by this Agreement that refers to a City administrative process by which the subject of a particular action is presented to the City’s Director of the Public Utilities Department or their designee for approval, based on discussion and evaluation according to sound engineering standards if applicable, and any additional requirements related to review for the action requiring the City’s Administrative Approval as set forth in this Agreement.
1.3 Annual Average Daily Flow is the number, in millions of gallons of wastewater per day (“MGD”), calculated by dividing total Flow on a fiscal year basis by the number of days in the applicable year, which is a term used for billing purposes.
1.4 ARA shall mean the Amended and Restated Regional Wastewater Disposal Agreement between the City and the Participating Agencies effective August 22, 2021.
1.5 Capital Expense Rate shall mean the same as the term is defined in Section 6.7.2.
1.6 Capital Improvement Costs means all costs of the planning, design, financing, construction, and/or replacement necessary to render a capital project facility fully operational, including upgrades and reconstruction, consistent with the City’s policies and procedures. This includes costs for planning and environmental work; procurement of consultants or contractors to perform such work; construction management; investigative studies and pre-design work; labor and materials; inspection and testing; and financing cost including interest on financial instruments.
1.7 Centrate shall mean the liquid byproduct that results from the dewatering of digested solids as part of wastewater treatment processes.
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1.8 Chemical Oxygen Demand or COD means the measure of the chemically decomposable material in wastewater, as determined by the procedures specified in the most current edition of “Standard Methods for the Examination for Water and Wastewater,” or any successor publication which establishes the industry standard.
1.9 City shall mean and refer to the City of San Diego.
1.10 City’s Water Utility shall mean any and all facilities, properties, improvements and works at any time owned, controlled or operated by the City as part of the public utility system of the City for water purposes, for the development, obtaining, conservation, production, storage, treatment, transmission, furnishing and distribution of water and its other commodities or byproducts for public and private use (whether located within or without the City), and any related or incidental operations designated by the City as part of the Water System, including reclaimed and re-purified water.
1.11 City Water Utility PWP Costs are those Pure Water Program costs allocated to the City’s Water Utility and therefore excluded as Metro System Costs under Section 6.3 of this Agreement.
1.12 Contract Capacity is the contractual right possessed by each Participating Agency to discharge wastewater into the Metro System pursuant to this Agreement up to the limits set forth in Exhibit B, Distribution of Wastewater System Capacity Rights, attached hereto.
1.13 Contract Capacity Transfers shall refer to the capacity transfers initiated based on Metered Flow and Strength data using the methodology set forth in Exhibit E, Methodology for Contract Capacity Transfers, which change a Participating Agency’s Contract Capacity, as set forth more fully in Section 4.4.3.1 and 4.4.3.2. These changes will generally be made to a single Participating Agency’s annual Contract Capacity to correct capacity exceedances but can also be made to reduce a Participating Agency’s Contract Capacity.
1.14 CWA shall mean the San Diego County Water Authority.
1.15 ECAWP JPA shall mean the East County Advanced Water Purification Joint Powers Authority. The ECAWP JPA itself is not a Participating Agency or a Party to this Agreement.
1.16 ECAWP JPA Agencies shall mean collectively the City of El Cajon, the Padre Dam Municipal Water District, and the San Diego County Sanitation District.
1.17 ECAWP Project shall mean the ECAWP JPA’s project to capture and treat wastewater that would otherwise be disposed of in the Metro System to produce an annual average supply of approximately 11.5 MGD of new local drinking water, as well as other byproducts such as recycled water and energy recovery facilities.
1.18 Fixed Capacity shall mean the capacities for Monthly Average Daily Flow, Incremental Peak Flow, RSDP, COD and TSS for each agency as set forth in Exhibit B.
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1.19 Fixed Capacity Charge shall mean the charges set forth in Exhibit B that are identified as “Fixed Capacity Charges” that represent the Parties’ proportional charges for maintaining the Metro System. Items such as debt service are also included in the Fixed Capacity Charges.
1.20 Flow shall refer to the flow of wastewater discharged by the City and/or one or more Participating Agency/ies into the Metro System.
1.21 Functional Allocated Billing or FAB shall mean the method for distributing all capital, operations, and maintenance Metro System Costs and Revenues on an annual basis by grouping expenses according to their purposes and the current approved Functional-Design Methodology.
1.22 Functional-Design Methodology shall mean the process of allocating fixed and variable Operation and Maintenance Costs and Capital Improvement Costs to Flow, RSDP and Strength parameters recognizing the benefits of both the design criteria and the primary function of a unit process.
1.23 Incremental Peak Flow shall mean the Peak Flow minus the Monthly Average Daily Flow.
1.24 Industrial Wastewater means all wastewater, excluding domestic wastewater, and shall include all wastewater from any producing, manufacturing, processing, institutional, commercial, service, agricultural, or other operation. These may also include wastes of human origin similar to domestic wastewater.
1.25 Industrial User means a discharger of Industrial Wastewater to a public sewer. A Participating Agency may be an Industrial User.
1.26 Joint Administrative Approval Process is an approval process authorized by this Agreement by which an Administrative Agreement may be created, revised, supplemented, replaced or terminated, subject to the review and approval process set forth more fully in Section 15.
1.27 MBC Return shall mean and refer to Centrate created at the Metropolitan Biosolids Center, 5240 Convoy St, San Diego, CA 92111. MBC Return shall contain Metered Flow, TSS and COD.
1.28 Metered Flow shall mean the amount or volume of wastewater captured by meters that exist throughout the Metro System, estimates from unit count areas, or agreed upon estimates of flows where unit counts are not appropriate. When meters are out of service, estimates can be used to fill in data gaps. These meters, which may or may not be owned by the City, are further defined in Exhibit F, Metro System Flow Formulas and Sampling Locations, which may be amended from time to time.
1.29 Metro Commission or Metro JPA is the advisory body described under Section 9.
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1.30 Metro System Costs shall mean, at a minimum, those costs set forth in Section 5.3 and as otherwise set forth in this Agreement.
1.31 Metro System Revenues are those revenues set forth in Section 5.5.
1.32 Metropolitan Sewerage System or Metro System shall mean and consist of those facilities which are listed, shown and/or described in Exhibit A, Metro Facilities (Electronic Exhibit); file name: [Enter]; time stamp of file, software used to open and view file including version; included herewith as CD-ROM/DVD-ROM, including any amendments thereto authorized by this Agreement. Exhibit A includes current constructed facilities and proposed future facilities.
1.33 Monthly Average Daily Flow is the number, in MGD, calculated by dividing total Flow on a monthly basis by the number of days in that month.
1.34 Municipal System shall mean the City’s wastewater collection system, consisting of pipelines and pump stations, which collects wastewater within the City of San Diego and conveys it to the Metropolitan Sewerage System for treatment and disposal.
1.35 New Contract Capacity shall mean capacity in excess of the Contract Capacity set forth in Exhibit B and authorized subject to Section 3.3.
1.36 North City Water Reclamation Plant or NCWRP is the wastewater treatment facility located at 4949 Eastgate Mall in San Diego, which includes four major processes: primary treatment, secondary treatment, tertiary treatment, and disinfection.
1.37 Operation and Maintenance Costs are the costs to operate, maintain, manage, repair, and keep the Metro System conveyance, disposal, treatment, and reuse facilities functioning in accordance with all applicable laws, rules, and regulations.
1.38 Participating Agencies shall mean all the local governments and agencies that executed this Agreement other than the City.
1.39 Peak Flow represents the wastewater flow in millions of gallons of wastewater per day that is captured in the highest 1-hour period in a fiscal year.
1.40 Point Loma Wastewater Treatment Plant or PLWTP is the main City wastewater treatment plant with a Monthly Average Daily Flow capacity of 240 million gallons per day and a peak flow capacity of 432 million gallons per day (as of the date of this Agreement). It is an advanced primary treatment plant which includes four major processes: screening, grit removal, chemically enhanced sedimentation, and digestion.
1.41 Pooled Capacity shall refer to the capacity in the Metro system greater than that which has been designated in Exhibit B. Pooled Capacity amounts are shown in Exhibit E, Methodology for Contract Capacity Transfers, and may be recalculated from time to time as set forth more fully in this Agreement.
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1.42 Postage Stamp Methodology is a methodology that can allocate a single uniform cost to any of the annual Contract Capacity cost parameters identified in Exhibit B. This methodology assumes that even though a particular discharger may not utilize all of the infrastructure, all dischargers into the Metro System benefit from the shared infrastructure.
1.43 Projected Future Strength and Flow Amounts are the five (5) values described below:
1.43.1 Projected Future Metro Flow is the estimated amount of Monthly Average Daily Flow, stated in millions of gallons per day (MGD), that the City and each Participating Agency are projected to have in a designated future year – currently, the 2050 fiscal year. Projected Future Metro Flow for each Party is stated in Exhibit B.
1.43.2 Projected Future Incremental Peak Flow is the estimated amount of Annual Incremental Peak Flow, stated in millions of gallons per day (MGD), that the City and each Participating Agency are projected to have in a designated future year – currently, the 2050 fiscal year. Projected Future Incremental Peak Metro Flow for each Party is stated in Exhibit B.
1.43.3 Projected Future RSDP Flow is the estimated amount of RSDP Flow, stated in millions of gallons per day (MGD), that the City and each Participating Agency are projected to have in a designated future year – currently, the 2050 fiscal year. Projected Future RSDP Flow for each Party is stated in Exhibit B.
1.43.4 Projected Future COD Flows is the estimated amount of Chemical Oxygen Demand (COD), stated in pounds per day, that the City and each Participating Agency are projected to have in a designated fiscal year – currently, the 2050 fiscal year. Projected Future COD Flows for each Party are stated in Exhibit B.
1.43.5 Projected Future TSS Flows is the estimated amount of Total Suspended Solids (TSS) stated in pounds per day, that the City and each Participating Agency are projected to have in a designated fiscal year – currently, the 2050 fiscal year. Projected Future TSS Flows for each Party are stated in Exhibit B.
1.44 Pure Water Capital Melded Percentage is the proportionate share stated in Column 7 of Exhibit B (formerly Column 12 of Exhibit G of the ARA), by which Pure Water Program Capital Improvement Costs, Repurified Water Revenue, and the Capital Expense Rate will be allocated among the City and the Participating Agencies. The Pure Water Capital Melded Percentage is based on each Party’s proportionate share of Projected Future Metro Flow, Projected Future TSS Flows, and Projected Future COD Flows, which proportions are weighted as described in Footnote 5 of Exhibit B.
1.45 Pure Water Program or PWP is the City’s phased, multi-year program designed to produce up to 83 million gallons per day of Repurified Water using new, expanded, or modified facilities, some of which will include Metro System facilities.
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1.46 PWP Phase 1 or Phase 1 shall mean the first phase of the Pure Water Program, which modifies/constructs Metro System and Water Repurification System facilities and is designed to produce an annual average of 30 million gallons per day of Repurified Water.
1.47 PWP Phase 2 or Phase 2 shall mean the second phase of the Pure Water Program which modifies/constructs Metro System and Water Repurification System facilities and is designed to produce up to an additional annual average of 53 million gallons per day of Repurified Water.
1.48 Recycled Water shall have the definition set forth in Title 22, Division 4 of the California Code of Regulations and shall mean water which, as a result of treatment of wastewater, is suitable for a direct beneficial use or a controlled use that otherwise could not occur.
1.49 Reject Stream from Demineralization Process or RSDP is a flow reject stream and treatment byproduct from a demineralization process at a potable reuse facility. Separately conveyed, it bypasses all secondary wastewater treatment processes. This flow that primarily contains liquid and salts.
1.50 Repurified Water shall mean water which, as a result of advanced treatment of Recycled Water, is suitable for use as a source of domestic (or potable) water supply.
1.51 Repurified Water Revenue is the cost savings that will be realized when the City’s Water Utility’s annual costs per-acre foot for Repurified Water, including City Water Utility PW Costs, are less than the purchase costs per-acre foot for comparable water from the San Diego County Water Authority, as further described in Section 6.
1.52 Residuals shall mean RSDP and Centrate. In the future, Residuals may include other waste byproducts if the Parties agree in writing that other byproducts may be discharged into the Metro System.
1.53 South Bay Ocean Outfall or SBOO is the facility that is jointly owned by the International Boundary & Water Commission (U.S. Section IBWC) and the City. The outfall conveys and discharges treated effluent from the IBWC’s International Wastewater Treatment Plant and treated effluent from the City’s South Bay Water Reclamation Plant. As of the date of this Agreement, the outfall has a current Average Daily Flow Capacity of 174 million gallons per day. As of the date of this Agreement, the City owns 39.94% of the capacity of the outfall and the balance of the capacity is owned by the IBWC.
1.54 South Bay Water Reclamation Plant or SBWRP is the wastewater treatment facility located at 2411 Dairy Mart Road in San Diego, which includes four major processes:
primary treatment, secondary treatment, tertiary treatment, and disinfection.
1.55 Strength means the measurement of Total Suspended Solids and Chemical Oxygen Demand within the Flow and any other measurement required by law after the date of this Agreement or necessary for the Functional Design Methodology.
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1.56 Total Suspended Solids or TSS means the insoluble solid matter in wastewater that is separable by laboratory filtration, as determined by the procedures specified in the most current edition of “Standard Methods for the Examination of Water and Wastewater,” or any successor publication which establishes the industry standard.
1.57 Tertiary Component is that portion of the wastewater treatment process that currently filters the secondary treated wastewater effluent through fine sand and/or anthracite coal to remove fine suspended solids and disinfects it to meet the requirements of the California Administrative Code, Title 22, or its successor for filtered and disinfected wastewater used for recycled and repurified water.
1.58 Two-Party Approval is an approval mechanism under this Agreement that requires the City’s Administrative Approval and a two-thirds (2/3) vote or greater of the Metro JPA Directors present at a duly noticed Metro JPA public meeting as described more particularly in Section 16.
1.59 Variable Costs shall refer to the portion of the Functional Design Methodology costs that are allocated based on Metered Flow and Strength.
1.60 Water Repurification System shall mean any facilities, including treatment and conveyance facilities, the purpose of which is the production or conveyance of Repurified Water.
Water Repurification System includes, but is not limited to: the Tertiary Component of the North City Water Reclamation Plant to the extent being used to produce Repurified Water, the North City Pure Water Facility; the Repurified Water conveyance system, which will transport Repurified Water from the North City Pure Water Facility and/or other facilities to the Miramar Reservoir or other alternative location(s) as determined by the City; and any other Repurified Water treatment or conveyance facilities which are part of the Pure Water Program. These facilities are constructed and maintained at the expense of the City water utility and are excluded Metro System Costs under this Agreement.
2. OWNERSHIP AND OPERATION OF THE METRO SYSTEM
2.1 Rights of the Parties. The City is the owner of the Metro System, and any additions to the Metro System or other facilities constructed pursuant to this Agreement. As more particularly set forth in this Agreement, and subject to the terms and conditions of this Agreement, the rights of the Parties generally include the following:
2.1.1 All decisions with respect to the planning, design, construction, operation and maintenance of the Metro System shall rest with the City, in consultation with the Metro JPA.
2.1.2 The Participating Agencies shall have a contractual right to use the Metro System and to participate in its operation.
2.1.3 The City may transfer ownership of all or part of the Metro System at any time. In the event of a transfer, including a sale under Section 2.7, the City’s successor shall be bound by the terms of this Agreement, and the Participating Agencies rights under this Agreement shall not be affected by such a transfer.
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2.1.4 Any Participating Agency may transfer or assign its rights and obligations under this Agreement. Any transfer shall first be approved by the City. No transfer may occur if the City reasonably determines, after consultation with the Participating Agencies involved, that the proposed transfer will imbalance or adversely impact the City’s ability to operate the Metro System.
2.2 Metro System Services.
2.2.1 The City shall provide wastewater conveyance, treatment and disposal services to the Participating Agencies through the Metro System, under the terms set forth in this Agreement.
2.2.2 The City shall operate the Metro System in an efficient and economical manner, maintaining it in good repair and working order, all in accordance with recognized sound engineering and management practices.
2.2.3 The City shall convey, treat, and dispose of or reuse all wastewater received under this Agreement in such a manner as to comply with all applicable laws, rules and regulations.
2.3 Flow Commitment.
2.3.1 Subject to the provisions of this Agreement and absent a separate agreement of the Parties, all Flow within the capacity limits set forth in Exhibit B or any amendments or changes thereto shall remain in the Metro System.
2.3.2 This Agreement shall not preclude any Party from diverting Flow as a result of the construction of reclamation/reuse facilities or New Capacity outside of the Metro System.
2.3.3 Any Participating Agency may negotiate an agreement with the City to reduce all or part of their Contract Capacity. If a Participating Agency reduces its Contract Capacity to zero, that Participating Agency’s rights shall terminate under this Agreement and that Participating Agency shall no longer be considered a member of the Metro JPA. However, the agreement between the City and Participating Agency shall provide that the Participating Agency pays its proportionate share of Capital Improvement Costs for the remainder of the useful life of the facility(ies) constructed during the time the Participating Agency possessed Contract Capacity in the Metro System. This shall include, but is not limited to, any remaining portions of outstanding debt that was incurred for capital facilities during the time the Participating Agency had the right to send Flow into the Metro System, and the cost to disconnect the Participating Agency’s system from the Metro System. Any Contract Capacity that a Participating Agency chooses to relinquish under this section shall be treated as Pooled Capacity after the effective date of an agreement between the City and that Participating Agency. This section does not apply to Inter-Agency transfers of Contract Capacity, which involve the relinquished Contract Capacity being assigned to and assumed by another Participating Agency or the City. Inter-Agency transfers are governed by Section 3.2
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development and growth. However, these projections may be amended from time to time through the Exhibit B amendment processes in this Agreement to more fairly align with actual flow and strength data. The parties shall begin discussion to recalculate the Projected Future Strength and Flow Amounts set forth in Exhibit B by no later than January 1, 2040.
2.4 Funding Obligations. The City shall fund the acquisition, construction, maintenance and/or operation of the Metro System from monies in (or sewer revenues which populate) the Sewer Revenue Fund for the Metro System, and/or from construction funds derived from the sale of duly authorized sewer revenue bonds for the Metro System. Nothing in this Section or Agreement shall (i) obligate the City to make any payment for the acquisition, construction, maintenance or operation of the Metro System from monies derived from taxes or any other income or revenue of the City; (ii) be construed to obligate the City or any Participating Agency to pay from its annual income and revenues any sum which would create an indebtedness, obligation or liability within the meaning of the provisions of Section 18 of Article XVI of the Constitution of the State of California and, in the City’s case, San Diego Charter Section 99; or (iii) prevent the City, in its discretion, from using tax revenues or any other available revenues or funds of the City for any purpose for which the City is empowered to expend moneys under this Agreement. For the avoidance of doubt, subsections (i) and (ii) shall not relieve the City from its obligations to fund the Metro System as provided in this Section 2.4.
2.5 Limitations on Types and Condition of Wastewater.
2.5.1 Each Participating Agency shall minimize to the maximum extent practicable, the infiltration and inflow of surface, ground or stormwaters into its respective wastewater systems.
2.5.2 Each Participating Agency will ensure that all Industrial Users of its wastewater system are regulated by and comply with the City’s industrial pretreatment program.
City shall not require the Participating Agencies to take any actions against such Industrial Users beyond that which are (1) required under applicable laws, rules and regulations, (2) taken by the City, or (3) that can be taken, but are not being taken by the City.
2.5.3 City and the Participating Agencies agree that the Interjurisdictional Pretreatment Agreements executed by and between the City and each Participating Agency, as applicable, shall terminate effective upon the date of this Agreement. However, the separate transportation agreements that are currently in effect between or among the City and the Participating Agencies shall remain in effect in accordance with their terms. Each Participating Agency will not discharge wastewater originating outside its respective boundaries into the Metro System without the approval of the City, which shall not be unreasonably withheld.
2.5.4 Each Participating Agency shall be responsible for the violation of any applicable laws, rules or regulations associated with its respective discharge of wastewater into the Metro System. Nothing in this Agreement shall affect or prohibit the ability of any Participating Agency to hold third parties responsible for such violations. However, City shall be responsible for enforcement actions related to the violation of any applicable laws, rules, or regulations associated with industrial waste dischargers regulated by City, though each Participating Agency ATTACHMENT B 136 July 7, 2026 Item 4
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shall collaborate with City when necessary, on any enforcement response for pretreatment violations within a Participating Agency’s jurisdiction. However, the City shall not be responsible for enforcement or monitoring related to a Participating Agency’s compliance with its own NPDES Permit.
2.5.5 Food establishments and dischargers of fats, oils, and grease (FOG) are regulated and monitored by individual Participating Agencies within their jurisdiction.
Participating Agencies are responsible for the provision of FOG programs, services, and enforcement within their jurisdiction. The City will not provide FOG-related services or programs outside of the City’s jurisdiction.
2.5.6 Residuals shall be separately conveyed so that the Residuals bypass all secondary wastewater treatment processes, unless otherwise agreed to in writing by the City and a Participating Agency or the City and a group of Participating Agencies. For the avoidance of doubt, the Agreement regarding Operation and Maintenance of the East County Residuals Line entered into by the City and the ECAWP JPA with an effective date of February 6, 2023 (specifically, Exhibit C to that agreement entitled Principles of Understanding for Operation and Residuals Management in Lieu of the East County Residuals Line), is an agreement that allows the Residuals from the ECAWP Project to convey Residuals in a manner that does not bypass all secondary wastewater treatment processes under certain conditions.
2.6 Enforcement Actions. In the event a regulatory agency, imposes any penalty or fine, or takes other enforcement action, or a private citizen brings a citizen enforcement action to enforce regulatory requirements, (collectively, “Enforcement Actions”) relating to the conveyance, treatment, or disposal of wastewater in or from the Metro System or operation of the Metro System, the City shall determine as part of its investigation and response to the notice of violation whether the City or a Participating Agency or Agencies caused or contributed to the violation for reasons which may include, without limitation, exceeding their Contract Capacity, the contents of their wastewater, or the failure to maintain or operate the Metro System or a Participating Agency’s system. Any costs associated with an Enforcement Action including but not limited to fines, penalties, corrective measures, and costs of defense (collectively, “Penalty(ies)”) shall be shared by the Participating Agencies and the City proportionately based on Fixed Capacity as set forth in the then current Exhibit B, unless the City determines, based on verifiable facts, that the violation for which the Penalty is imposed was caused by, or was the result of, gross negligence or willful misconduct of the City or a Participating Agency.
2.6.1 For any Enforcement Actions (1) related to sanitary sewer overflows of 10,000,000 gallons or more from the Metro System occurring after the effective date of this Agreement, or (2) that the City reasonably anticipates will result in the Participating Agencies’ collective responsibility for the Penalties imposed to exceed 10% of the Metro Participating Agencies combined annual operations and maintenance budget for the Metro System for the fiscal year in which the Penalty is imposed (“Threshold Amount”), the City’s determination will be subject to review by the Metro JPA as set forth in 2.6.1.1 through 2.6.1.8 below. The scope of the Metro JPA’s review shall be limited to whether the violation for which the Penalty is imposed was caused by, or was the result of, gross negligence or willful misconduct of the City or a Participating ATTACHMENT B 137 July 7, 2026 Item 4
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Agency, and if so, how the Penalty should be fairly allocated. For all other Enforcement Actions, the City’s determination related to the allocation of Penalty shall be final.
2.6.1.1 The City will provide a copy of any report submitted to a regulatory agency in response to an Enforcement Action to the Metro JPA within 30 days of submitting that report to the regulatory agency. In that same communication, the City will also provide a summary of the City’s findings regarding causation and preliminary determination regarding the allocation of any Penalties. If these determinations have not been made, the City will provide an anticipated date that the information will be provided.
2.6.1.2 If the Metro JPA disputes the City’s determination as to the allocation, as evidenced by a vote approved by two-thirds of the Metro JPA Directors present at a duly noticed meeting, it shall notify the City in writing of the same within 90 days of receiving the City’s preliminary allocation determination.
2.6.1.3 The City and representatives of the Metro JPA shall meet and confer to discuss the matter and try to reach an agreement on the appropriate allocation. To facilitate resolution, the meet and confer process shall be treated as a settlement discussion under the California Evidence Code and shall be a confidential process. The meet and confer process shall focus on whether the violation for which the Penalties are being imposed is the result, in whole or in part, of the gross negligence or willful misconduct of the City or a Participating Agency, and if so, how the Penalties shall be allocated.
2.6.1.4 If through the meet and confer process, the City determines that the Participating Agencies’ collective responsibility for the Penalties imposed will be less than the Threshold Amount, then the City will inform the Metro JPA of this determination and allocate the Penalty as such, and no further action by the Metro JPA is required.
2.6.1.5 If through the meet and confer process, the City and representatives of the Metro JPA reach an agreement, and the Participating Agencies’ collective responsibility for the Penalties imposed will be equal to or greater than the Threshold Amount, then that agreement shall be subject to the Two-Party Approval process. The City and representatives of the Metro JPA shall have an opportunity to present the proposed agreement to the Metro JPA before a vote on the determination.
2.6.1.6 If the City and representatives of the Metro JPA are unable to reach an agreement and Participating Agencies’ collective responsibility for the Penalties imposed is equal to or exceeds the Threshold Amount, the City will make a final determination regarding allocation of the Penalty and present the determination to the Metro Commission.
2.6.1.7 In the event that Two Party Approval is required but is not achieved, each Participating Agency shall pay the portion of the Penalty allocated to them at the time that it is invoiced, however, such payment may be made under protest. The Parties shall engage in the dispute resolution procedures under this Agreement to resolve the issue, prior to any Party having the right to initiate litigation.
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2.6.1.8 Penalties in excess of the Threshold Amount shall be separated out in the reconciliation billing and notated as a spill penalty with reference to the first day of the spill associated with the penalty.
2.7 Right of First Refusal.
2.7.1 The City shall not sell or agree to sell the Metro System without first offering it to the Participating Agencies. For the purposes of this section, “Participating Agencies” shall mean a Participating Agency, a group of Participating Agencies, or a third party representing one or more Participating Agencies. The term “sell” shall include any transfer or conveyance of the Metro System or of any individual treatment, collection, or reclamation facility or outfall within the Metro System.
2.7.2 The City and the Participating Agencies recognize that transfer of ownership of the Metro System is currently restricted by Sections 6.04 and 6.20 of the Installment Purchase Agreement between the City and the Public Facilities Financing Authority of the City, which inter alia restricts the transfer of ownership to the Metropolitan Wastewater Sewage District or other governmental agency whose primary purpose is to provide wastewater treatment. The City shall not seek to impose on bond holders a waiver of Section 6.04 or 6.20. Absent such a restriction, before the City sells or agrees to sell the Metro System, or any portion of it, the City shall offer to sell the Metro System to the Participating Agencies (the “Offer”) on the terms and at a price equal to that proposed for the sale of the Metro System to a third party. The City shall provide all Participating Agencies with written notice of the Offer per Section 13 . The Participating Agencies shall have ninety (90) days from the date of mailing of the Offer (the “Intent to Respond Period”) in which to notify the City of their intent to respond to the Offer. If a Participating Agency or Agencies notify the City of their intent to respond to the Offer, that Participating Agency or those Agencies shall have five months from the expiration of the Intent to Respond Period in which to accept or reject the Offer. The Offer shall contain the name of the proposed purchaser, the proposed sale price, the terms of payment, the required deposit, the time and place for the close of escrow, and any other material terms and conditions on which the sale is to be consummated. If no Participating Agency or Agencies notifies the City of its (or their) intent to respond to the Offer within the Intent to Respond Period, the City may move forward with the sale of the Metro System without further notice to the Participating Agency in accordance with Section 2.7.3 below.
2.7.3 If the Participating Agencies give timely notice of their intent to respond and timely notice of their acceptance of the Offer, then the City shall be obligated to sell and the Participating Agencies shall be obligated to purchase the Metro System or any individual treatment, collection or reclamation facility or outfall within the Metro System, as applicable, at the price and on the terms and conditions of the Offer. If the Participating Agencies do not give timely notice of their intent to respond or their acceptance of the Offer, or do not submit an offer on the same terms and conditions as the Offer, the City may, following the end of the Offer period, sell the Metro System, or any portion of it, at a price and on terms and conditions no less favorable to the City than those in the Offer. The City shall not sell the Metro System to any third party on terms or at a price less favorable to the City from the terms and price contained in the Offer absent compliance with the terms of this Section. The City’s sale of the Metro System under Section 2.7, is a transfer of ownership subject to Section 2.1.3.
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2.7.4 Nothing herein shall prevent the City from entering into a financing agreement which may impose limits on the City’s power to sell the Metro System to the Participating Agencies pursuant to Section 2.7.1 if the City reasonably believes that such a financing agreement is in the City’s best interest. Neither the entry into such a financing agreement by the City nor the performance thereof by the City shall constitute a breach or default by the City hereunder.
2.8 Uniform Enforcement of Pretreatment Program by City. The Parties have determined that it is in their best interests for a single agency to be responsible for management of the pretreatment program for the Metro System in order to: (a) Ensure protection of the entire Metro System, including the successful operation of the Pure Water Program; (b) Provide consistent and uniform regulation of Industrial Users, including those subject to pretreatment requirements; (c) Provide for transparent and fair cost recovery from all dischargers; and (d) Promote efficiency and accountability in the administration of the Metro System. For these reasons, the Parties are delegating pretreatment responsibilities to the City, except regulation of Food Establishments and FOG dischargers, as more fully set forth in this Agreement and in Administrative Agreement #1 Between City of San Diego and Participating Agencies for the Unified Management of Industrial Waste Discharge Pretreatment and Enhanced Source Control Programs (“Administrative Agreement #1”). Notwithstanding the above, the City may enter into supplementary agreements with an individual Participating Agency, or a group of Participating Agencies, relating to industrial waste discharge pretreatment and enhanced source control programs unique to such Participating Agency(ies), so long as the supplementary agreement incorporates a separate cost proportional to the participation of such Participating Agency or group of Participating Agencies that is the sole responsibility of such Participating Agency(ies).
2.8.1 Delegation of Authority. Each Participating Agency shall and hereby does delegate to City full authority and responsibility to operate, manage, and enforce an effective pretreatment program throughout the Metro System to ensure that all Industrial Users are subject to uniform rules and regulations, with direct billing to Industrial Users by the City to begin on the first July 1 following execution of this Agreement.
2.8.2 Operations and Maintenance. Procedures relating to the operation, management, enforcement, and cost recovery for the pretreatment program are set forth in Administrative Agreement #1.
2.8.3 Amending Pretreatment Program Procedures. Administrative Agreement #1 may be amended from time to time as set forth in Section 15. In the event of any conflict between this Agreement and Administrative Agreement #1, the terms of this Agreement shall control.
2.8.4 Adoption of Local Ordinances. By no later than June 30 following the Effective Date of this Agreement, every Participating Agency shall adopt a local ordinance conforming with the sample ordinance contained in Administrative Agreement #1 and the City’s pretreatment ordinance, each as amended from time to time, to ensure consistency throughout the Metro System.
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2.8.5 Identification of New Industrial Users. Participating Agencies shall notify the City of any identified potential new Industrial Users within their respective boundaries while the City will bear responsibility for inventory assessments on a regular basis as set forth in Administrative Agreement #1.
2.8.6 Permitting and Permit Compliance. Nothing in this Agreement shall be construed to relieve any discharger to the Metro System of the responsibility to obtain and comply with any required permits for, and to comply with rules and regulations applicable to, dischargers to the Metro System. If the City determines that an Industrial Wastewater Control Program Permit is required, it shall issue the permit subject to the City’s permit requirements. The City’s approval or denial of any application for, or revocation of, an Industrial User Permit shall be in accordance with Chapter 6, Article 4 of the San Diego Municipal Code as well as any other applicable federal, state or local regulations, any published City guidance related to the Industrial Wastewater Control Program, and the City’s Enforcement Response Plan, all as may be amended, renumbered, or renamed from time to time. The City and any Participating Agency may elect to coordinate and combine issuing their wastewater discharge permits to Industrial Users when deemed appropriate by both parties. Any agreement between the City and the Participating Agencies related to permitting under the Industrial Wastewater Control Program, shall not transfer responsibility to City for any other type of permitting outside of the City’s jurisdiction, or subject any local agency as that term is defined in California Government Code section 53090, to local building and zoning ordinances that the local agency is not otherwise legally subject to.
2.8.7 Inventory of Industrial Users. City shall create and maintain an inventory of all Industrial User within the Metro System as soon as reasonably practicable following execution of this Agreement. The Participating Agencies shall review the inventory and shall notify the City of an Industrial User(s) in its jurisdiction that is not identified on the inventory as set forth in Administrative Agreement #1.
2.8.8 Evaluation, Monitoring, Enforcement and Program Review. Upon the effective date of this Agreement, it shall be the City’s right and obligation to carry out pretreatment evaluation, permitting, monitoring and/or enforcement throughout the Metro System consistent with the procedures set forth in Administrative Agreement #1. The City’s pretreatment program review shall occur as necessary, but no less than once every five (5) years. Nothing herein shall be construed as prohibiting any Participating Agency from enforcement of its own pretreatment ordinance within its jurisdiction.
2.8.9 City’s Direct Billing of Industrial Users. The City shall directly bill Industrial User throughout the Metro System to recover costs associated with the pretreatment program as set forth in Administrative Agreement #1. The City Council shall set and approve such costs in a publicly noticed meeting pursuant to the procedures set forth in Administrative Agreement #1.
2.9 Wastewater Generated at Military Bases. The City may contract directly with federal military bases that are connected to the Metro System for wastewater services and capacity subject to the terms of this Section 2.9. If a United States military base is located within a Participating Agency’s jurisdiction, the Participating Agency may request that the City bill that ATTACHMENT B 141 July 7, 2026 Item 4
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military base directly as a separate and distinct customer. In the event the City agrees to accept the military’s wastewater and bill the military base as a separate and distinct customer, then (1) the Participating Agency shall have no billing obligations with respect to the military base; (2) each Participating Agency whose sewage line conveys the military base’s wastewater reserves the right to negotiate and charge the federal government a conveyance or transportation fee for use of that Participating Agency’s sewer line; (3) the City shall require that the military base comply with the applicable City pretreatment rules; and (4) the City agrees that the wastewater generated by the military base shall not be considered wastewater of the Participating Agency with respect to capacity once the City enters into an agreement with the military base. Any transfers of capacity that are appropriate or necessary to accommodate flow from military bases, if needed, would be governed by Section 3.2 herein, “Inter-Agency Transfers of Contract Capacity.”
3. CAPACITY RIGHTS
3.1 Contract Capacity. Each Participating Agency shall have the contractual right to discharge wastewater to the Metro System up to the limits set forth in Exhibit B (“Contract Capacity”). Each Party’s Contract Capacity as stated in Exhibit B, is used for the purpose of allocating the Metro System’s Pure Water Program Capital Improvement Costs, Repurified Water Revenue, and the Capital Expense Rate under this Agreement.
3.2 Inter-Agency Transfers of Contract Capacity. The Participating Agencies and the City may buy, transfer, sell or exchange all or part of their Contract Capacity among themselves on such terms as they may agree upon, subject to the following:
3.2.1 Any Party requesting to buy, transfer, sell, or exchange all or part of their Contract Capacity (“Inter-Agency Transfer”) shall provide a written proposal to the City including the proposed terms of such Inter-Agency Transfer. The Party requesting the Inter-Agency Transfer shall also provide notice to all other Participating Agencies under Section 13 concurrently with submitting the proposal to the City.
3.2.2 All Participating Agencies will have 45 days to provide any technical input to the City regarding the proposed Inter-Agency Transfer. Any Participating Agency providing technical input shall provide a copy of such input to all other Participating Agencies under Section 13 concurrently with submitting the input to the City.
3.2.3 Upon receipt of a request for an Inter-Agency Transfer, the City will review the request, consult with the affected Participating Agencies, and consider any technical input provided by other Participating Agencies.
3.2.4 All proposed purchases, transfers, sales or exchanges of Contract Capacity require the City’s Administrative Approval prior to becoming effective. No Contract Capacity may be transferred if the City determines that said transfer will imbalance, or will otherwise adversely impact the City’s ability to operate the Metro System. Provided, however, that the Participating Agency seeking the transfer may offer to cure such imbalance at its own expense. If the Participating Agency makes such an offer, the City may not unreasonably withhold Administrative Approval.
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3.2.5 If the City approves the offer as proposed, the City shall adjust the Contract Capacity set forth in Exhibit B per Section 3.6 to reflect the approved changes. If the City determines, after taking the steps in Section 3.2.3 that an Inter-Agency Transfer may be approved if the request is modified, the City will provide a written notice to all Participating Agencies of the modified Inter-Agency Transfer under Section 13 no less than 30 days prior to the Inter-Agency Transfer becoming effective. Such modified Inter-Agency Transfer will become effective 30 days following the written notice being provided, and the City will prove an updated Exhibit B per Section 3.6 reflecting the approved changes.
3.2.6 If a Participating Agency reduces its Contract Capacity to zero through an Inter-Agency Transfer, that Participating Agency’s rights under this Agreement shall terminate and that Participating Agency shall no longer be a member of the Metro JPA. The Participating Agency shall remain responsible for all outstanding financial obligations under this Agreement, unless the Inter-Agency Transfer Agreement assigns those obligations to the Participating Agency accepting the transfer and that agency assumes those obligations. Outstanding financial obligations include, but are not limited to, a Participating Agency’s proportionate share of Capital Improvement Costs for the remainder of the useful life of the facility(ies) constructed during the time the Participating Agency possessed Contract Capacity in the Metro System, including any remaining portions of outstanding debt incurred for capital facilities during the time the Participating Agency had the right to send Flow into the Metro System, and the cost to disconnect the Participating Agency’s system from the Metro System.
3.3 New Contract Capacity. The Parties recognize that the Metro System may be modified to create capacity in the Metro System beyond that set forth in Exhibit B as a result of the construction of additional facilities, acquisition of facilities, increased flows, or as required by regulatory or similar such action. If capacity in excess of the Contract Capacity (“New Contract Capacity”) is required or requested by a Party, the Parties shall negotiate in good faith to provide the needed or requested capacity. If the Parties agree to provide New Contract Capacity, they shall memorialize the agreement for New Contract Capacity in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. If the parties execute an Administrative Agreement for New Contract Capacity, Exhibit B shall also be adjusted pursuant to Section 3.6 to reflect the New Contract Capacity.
3.4 Reductions in Metro System Capacity. The Parties further recognize that Metro System Capacity may be reduced to comply with, or in response to, applicable permit conditions, or related regulatory action, or sound engineering principles. In the event that the capacity of the Metro System is re-rated to levels below the numbers reflected in the Totals Line set forth in Exhibit B, then the Contract Capacity shall be reallocated proportionately among the Parties based on the percentages of fixed ownership set forth in Exhibit B at that point in time, subject to the City’s Administrative Approval and amendment of Exhibit B.
3.5 Restrictions on Veto of Transfers and Acquisitions of Capacity. Each Party understands and agrees that no Participating Agency has a right to veto or prevent the transfer of capacity between other Participating Agencies or the City, nor the creation or acquisition of new capacity for another Participating Agency or Agencies. By signing this Agreement, each Participating Agency is expressly preapproving such actions. The sole right of a Participating ATTACHMENT B 143 July 7, 2026 Item 4
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Agency to object to any of the foregoing shall be through expression of its opinion to the Metro JPA and, where applicable, through exercise of its rights under the dispute resolution provisions of this Agreement.
3.6 Amendments to Exhibits B. If the City determines that an amendment to Exhibit B is required for any reason other than a request from a Participating Agency under Sections 2.3.3 and Sections 3.2, and that reason only requires the City’s Administrative Approval, the City shall prepare and circulate to all Participating Agencies a notice explaining the facts and circumstances that the City’s determination is based on(including any relevant data available), and the proposed amendment to Exhibit B within 60 days of determining such an amendment is necessary. The Participating Agencies will have sixty (60) days to provide comments to the City, and all comments submitted to the City by a Participating Agency shall also concurrently be submitted to all other Participating Agencies. The City will review all comments received, prepare final amendments to Exhibit B to reflect adjustments in Contract Capacity, and circulate the final amended Exhibit B by no later than sixty (60) days after the City’s Administrative Approval. If the amendment to Exhibit B requires an approval process other than the City’s Administrative Approval, the Parties will follow the required approval process, and once that is completed, the City will prepare and provide the final version of Exhibit B within 60 days of the completion of the approval process.
The City shall note each amendment and amendment date in the Exhibit List and shall keep an updated version of Exhibit B on file with the City Public Utilities Department at all times. An amendment to Exhibit B shall not be retroactive, except as provided in Section 4.4.3.3.
3.7 The South Bay Ocean Outfall. Nothing in this Agreement shall limit the City’s right to transfer capacity rights in assets that are not a part of the Metro System, including without limitation that portion of the South Bay Ocean Outfall which is not part of the Metro System.
4. FINANCE, BUDGETING, AND ACCOUNTING: PAYMENT AND MONITORING
PROVISIONS
4.1 Payment for Metro System Facilities. Through the system of charges set forth in Section 5 of this Agreement, each Participating Agency shall pay its share of the costs of planning, design and construction of all of the Metro System facilities which are identified in Exhibit A .
4.2 Payment for Additional Metro System Facilities. Through the system of charges set forth in Section 5 of this Agreement, each Participating Agency shall pay its share of the costs of acquisition, planning, design and construction of such facilities, in addition to those set forth on Exhibit A, as are necessary to (a) convey, treat, dispose, and reuse wastewater in the Metro System; (b) provide the Contract Capacity set forth in Exhibit B; and (c) maintain hydraulic capacity as otherwise required by sound engineering principles. Each Participating Agency shall pay its share of the costs necessary to ensure the Metro System maintains compliance with applicable laws, rules and regulations, including the Ocean Pollution Reduction Act of 1994 and its successor(s), as well as present and future waivers of applicable treatment standards at any Metro System treatment facility. Exhibit A may be amended to reflect replaced or rehabilitated facilities, or changes in facilities, subject to the City’s Administrative Approval; however, if the City proposes to add a new Metro facility to Exhibit A, or convert a City facility to a Metro facility that will be added to Exhibit A, then each such amendment shall be (1) subject to the City’s Administrative Formatted: Font: Bold
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Approval, in its sole discretion, when the addition or conversion is for the purpose of complying with applicable laws, rules, or regulations; or (2) supported by an independent third-party study setting forth the benefits to the Metro System of each new facility, including a cost allocation for capital and projected annual maintenance costs if the addition or conversion is for any other purpose. For any new Metro facility or conversion of a City facility to a Metro facility proposed to be added or converted under (2) above, any such proposal must be memorialized in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. Once approved, the City shall amend Exhibit A accordingly and shall give notice of any amendments to all Participating Agencies. The City shall keep an updated version of Exhibit A on file with the City Public Utilities Department. Exhibit A may be amended to reflect other changes to the Metro System only as expressly provided in this Agreement.
4.3 Payment for Operation and Maintenance. Through the system of charges set forth in Section 5 of this Agreement, each Participating Agency shall pay its share of the Operation and Maintenance Costs of all Metro System facilities. The Participating Agencies shall not pay for the Operation and Maintenance Costs of the Water Repurification System, which are City Water Utility PW Costs.
4.4 Charges Based on Flow, Strength and Fixed Capacity: Exception.
4.4.1 Except as otherwise described in this Section 4.4, a Participating Agency’s share of the charges in this Section 4 shall be based on its proportionate Flow, Strength, and Fixed Capacities as set forth in Exhibit B, as described more fully in Section 5.
4.4.2 Notwithstanding Section 4.4.1, or any other provision of this Agreement, a Participating Agency’s share of PWP Phase 1 Capital Improvement Costs, PWP Phase 1 Repurified Water Revenue, and Pure Water Program Capital Expense Rate attributable to the Metro System as described in Sections 6.6 and 6.7 shall be assessed or credited based on the Parties’ proportionate share of the Pure Water Capital Melded Percentages set forth in Column 7 of Exhibit B. The City shall annually allocate the estimated and actual PWP Phase 1 Capital Improvement Costs and revenues which are attributable to the Metro System in proportion to each Party’s Pure Water Capital Melded Percentages as set forth in Column 7 of Exhibit B when estimating quarterly payments and conducting year-end adjustments.
4.4.3 Each Party recognizes that operation within respective Projected Future Strength and Flow Amounts is essential to the accurate allocation of costs and revenues under the Pure Water Program. In recognition of same, the Parties agree as follows:
4.4.3.1 Contract Capacity Transfers – Increases in Fixed Capacity Components. Beginning in the next fiscal year after the effective date of this Agreement, if a Party exceeds their Capacity Rights or any individual component of the Capacity Rights set forth in Exhibit B, by any one of the following triggers based upon data available at the completion of a fiscal year: (1) Three percent (3%) in a fiscal year for any two consecutive fiscal years, (2) One MGD in a fiscal year for any two consecutive fiscal years, or (3) The equivalent Strength of one MGD in a fiscal year for any two consecutive fiscal years; then, the City shall prepare an amendment to Exhibit B that reflects a Contract Capacity Transfer for that Party based on the ATTACHMENT B 145 July 7, 2026 Item 4
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available information about such Party’s exceedance(s) and the methodology set forth in Exhibit E.
After Phase 2 is completed, if, due to contract capacity transfers or reductions in capacity, the Pooled Capacity drops to less than two percent (2%) of the total Contract Capacity, a capacity study shall be initiated to evaluate existing facilities for new capacity. The City shall thereafter amend Exhibit B under the process set forth in Section 3.6 to reflect the new Contract Capacity for all Parties. Any changes to the methodology in Exhibit E shall be made pursuant to an Administrative Agreement subject to the Joint Administrative Approval Process described in Section 15.
4.4.3.2 Contract Capacity Transfers – Decreases in Fixed Capacity Components. Beginning in the next fiscal year after the effective date of this Agreement, if a Party can show through an independent report that its Monthly Average Daily Flow, annual average pounds per day of COD, annual average pounds per day of TSS, Incremental Peak Flow, or RSDP is projected to decrease ten percent (10%) or more below their Projected Future Strength and Flow Amounts using data from a minimum of three (3) consecutive prior fiscal years as support, then City shall prepare a proposed amendment to Exhibit B that reflects the new Projected Future Strength and Flow Amounts for all Parties based on such Party’s decrease and other relevant information using sound engineering principles and the guidelines set forth in Exhibit E. The City’s proposed amendment shall be subject to the Two-Party Approval Process. If approved, the City shall thereafter amend Exhibit B using the process set forth in Section 3.6.
4.4.3.3 If Exhibit B is amended to update one or more Parties’ Projected Future Strength and Flow Amounts pursuant to Section 4.4.3.1 or 4.4.3.2, the change in Projected Future Strength and Flow Amounts shall be effective retroactively to the beginning of that fiscal year, and the City shall use the updated amounts in estimating quarterly payments and conducting year-end adjustments for Pure Water Program costs and revenues. Therefore, any Party that underpaid based on prior Exhibit B Fixed Capacity amounts (which were based on prior Projected Future Strength and Flow Amounts) shall pay the retroactive amount due in quarterly installments in its quarterly payments the following fiscal year; any Party that overpaid based on previous Exhibit B Fixed Capacity amounts shall receive a credit in quarterly installments in its quarterly payments the following fiscal year. Notwithstanding the preceding sentence, if the retroactive amount due exceeds 20% of a Party’s average annual Metro System payments for the previous four (4) fiscal years, such Party may elect to pay the retroactive amount due in its quarterly payments over the subsequent four (4) fiscal years, with interest, based on the most recent quarterly earnings rate of the City’s Treasurer’s Pooled Rate of Return; any Party that overpaid in an amount that exceeds 20% of their annual average Metro System payments for the previous four (4) fiscal years based shall receive a credit in its quarterly payments spread over the following four (4) fiscal years.
4.5 Monitoring Flow and Strength.
4.5.1 The City shall monitor Flow and Strength. The City shall own and operate as part of the Metro System monitoring devices which will measure the amount of Flow discharged into the Metro System, unless otherwise agreed by the City and a Participating Agency. These devices shall be installed at locations appropriate to accurately monitor Flow and Strength. The City may also monitor Flow and Strength at other locations as it deems appropriate. For all ATTACHMENT B 146 July 7, 2026 Item 4
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currently unmetered areas, unit counts or agreed upon flow estimates where unit counts are not appropriate shall be used. For adding or subtracting unit count areas, the average current Metro Flow per unit shall be used consistently for all Parties. These unmetered unit counts will be updated at least once every five (5) years. If the flow in an unmetered area is over 0.5 MGD at a specific connection point, then a meter shall be added for that area, if possible. Exhibit F provides the Flow formulas that shall be used to determine the payment obligation for each Party, or a grouping or subgrouping of Parties, as applicable. Exhibit F shall be distributed to all Parties with the budget estimates that are sent annually pursuant to Section 5.7.1. The City currently provides all Participating Agencies with access to their data from the Flow metering devices, including providing access to their raw data, and will continue to do so according to the Parties’ established practices on the Effective Date of this Agreement. Changes to Exhibit F may be made upon the City’s Administrative Approval.
4.5.2 In measuring Strength, the frequency and nature of the monitoring shall not be more stringent for the Participating Agencies than it is for the City. The frequency, nature, and locations of Strength measurements, as well as the procedures used to determine Strength, shall be reviewed at least once every five (5) years and if changes are appropriate or required, the City may change the Strength measurements subject to the Two-Party Approval process. When conducting sampling within a Participating Agency’s service area, the City shall follow appropriate safety and security measures. The City and Participating Agencies will coordinate with the Participating Agency’s operations staff to ensure facilities are not negatively impacted by inspections.
4.5.3 The City shall report Strength data to the Participating Agencies at least quarterly.
4.5.4 The City shall notify the Metro JPA’s Executive Director and any directly affected Participating Agency within 24 hours of any unpermitted or unlawful discharge or release of effluent from the Metro System which may be reportable to the Regional Board, or any other regulatory agency, and which may result in civil or criminal penalties or administrative enforcement proceedings pursuant to Water Code sections 13261, et seq., section 13300, et seq., Government Code section 54740 et seq., or other provisions of law. Upon request from the Metro JPA or a Participating Agency, City shall provide the Metro JPA or affected Participating Agencies with copies of all non-privileged related correspondence to and from the Regional Board. The City shall endeavor to confer with Metro JPA staff during the report preparation process and before any report is submitted to a regulatory or enforcement agency.
5. FINANCE, BUDGETING, AND ACCOUNTING: SYSTEM OF CHARGES
5.1 Charges Authorized. The City agrees to implement, and the Parties agree to abide by a system of charges called Functional Allocated Billing (FAB). This system allows the City to equitably recover from all Participating Agencies their proportional share of the net Metro System Costs described in this section:
5.2 Functional Allocated Billing (FAB). The City shall annually determine the FAB rate based on the projected Metro System Costs (as defined below) for the forthcoming fiscal year, less all Metro System Revenues (as defined below). A detailed illustration of the FAB methodology ATTACHMENT B 147 July 7, 2026 Item 4
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using sample data is attached hereto as Exhibit J (the Sample FAB Calculation) to assist the Parties in understanding how the FAB methodology works. Exhibit J provides an illustration of the application of FAB to applicable parameters and the derivation of unit rates and resulting charges. The Parties agree that Exhibit J is intended to promote transparency and a common understanding of the implementation of FAB under this Agreement, but the Parties acknowledge that Exhibit J is illustrative only and shall not control over the terms of this Agreement or the actual calculation of annual FAB rates, which shall be determined in accordance with this Section 5.
5.2.1 Calculation of FAB Rates.
5.2.1.1 The City shall determine the unit FAB rates by allocating net costs (Metro System Costs less Metro System Revenues) between the fixed and measured variable parameters of Capacity Rights, such as Monthly Average Daily Flow, Incremental Peak Flow, COD, TSS, and RSDP as set forth in Exhibit B. These allocations are based on the approved Functional-Design Methodology analyses for sewer system components and estimated Operation and Maintenance (O&M) Costs allocated to each parameter.
5.2.1.2 Beginning one (1) year after substantial completion of the final project of Phase 1 of the Pure Water Program for which sewer revenue funds were used, the City shall have the FAB, which includes the Functional Design Methodology, professionally reviewed at least once every five (5) years.
5.2.1.3 After conducting a professionally developed independent thirdparty report, the City may propose to change the FAB, including the Functional Design Methodology, to include any other parameter, or modify any term governed by this Section 5.2.1, by way of an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15. However, the City may revise the FAB, including the Functional Design Methodology at any time to include any other measurement required by law after the effective date of this Agreement subject to the City’s Administrative Approval, in its sole discretion. City will notify all Participating Agencies of any such review or revision no later than sixty (60) days after City’s Administrative Approval. Once approved, the FAB resulting from any review or revision under this Section will become the current approved version until it is revised by a future professional independent third-party study or a change in law.
5.2.1.4 Each of the parameters will have a fixed and variable O&M charge between 0% and 100%. Fixed Capacity Charges will be based on the Contract Capacity in Exhibit B. Variable charges will be based on measured parameters such as Metered Flow, Strength and RSDP.
5.2.1.5 Costs for capital improvements, capital replacement, and rehabilitation costs including financing shall be based on the approved Functional-Design Methodology and the Contract Capacity in Exhibit B.
5.2.1.6 The net cost allocated to each of the parameters shall be divided by the total Metro System quantity for that parameter to determine the unit rates for each parameter.
These unit rates shall apply uniformly to all Parties.
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5.3 Metro System Costs. The following shall at a minimum be considered Metro System Costs for purposes of calculating the annual FAB rate:
5.3.1 Except as provided in Section 5.4 (Excluded Costs), the annual Operation and Maintenance Costs and annual costs associated with administration, replacement, annual debt service costs and other periodic financing costs and charges, capital improvement, insurance premiums, claims payments and claims administration costs of the Metro System, including projected overhead, shall be calculated using generally accepted accounting practices to reflect the costs of the Metro System.
5.3.2 Fines or penalties imposed on the City as a result of the operation of the Metro System, unless the fine/penalty is allocated to the City or a Participating Agency as provided in Section 2.5.5.
5.4 Excluded Costs. The following items shall not be considered Metro System Costs for purposes of calculating the annual FAB rate:
5.4.1 Costs related to the City of San Diego’s municipal sewer, water (including City Water Utility PWP Costs), and/or stormwater systems as determined by City’s reasonable calculations consistent with sound engineering and best management practices.;
5.4.2 Right-of-way charges for the use of public streets of the City or any Participating Agency. The City and the Participating Agencies agree not to impose a right-of- way charge for the use of its public rights-of-way for Metro System purposes;
5.4.3 Capital Improvement Costs or Operations and Maintenance Costs of any non-Metro System facility not included in Exhibit A, including, but not limited to, any costs associated with the ECAWP Project;
5.4.4 Those costs otherwise identified as excluded costs in Section 6.3.
5.5 Metro System Revenues and Allocations. The following revenues shall be at a minimum considered Metro System Revenues for purposes of determining the annual FAB rate:
5.5.1 Any grant or loan receipts or any other receipts that are attributable to the Metro System or Metro System components of the Pure Water Program, including, but not limited to, all compensation or receipts from the sale, lease, or other conveyance or transfer of any asset of the Metro System or Metro System components of the Pure Water Program. Any such receipts attributable to the Metro System components of the Pure Water Program shall be allocated among the City and the Participating Agencies in the proportions set forth in Exhibit B Fixed Capacity amounts.
5.5.2 All compensation or receipts from the sale or other conveyance or transfer of any Metro System byproducts, including, but not limited to, gas, electrical energy, sludge products, and Recycled Water produced at the NCWRP and SBWRP and the future Central Area Plant.
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5.5.3 Payments by the City’s Water Utility for the Capital Expense Rate, as calculated under provisions in Section 6.7. These proceeds shall be allocated among the City and Participating Agencies in the proportions set forth in Exhibit B Fixed Capacity amounts.
5.5.4 Those portions of Repurified Water Revenue attributable to the Metro System, as calculated under provisions in Section 6.6.3. These revenues shall be allocated among the City and Participating Agencies in the proportions set forth in Exhibit B Fixed Capacity amounts.
5.5.5 Any other non-operating revenues, including, but not limited to interest income included in the income credit portion of the annual audit.
5.6 Excluded Revenue. The following revenues shall be excluded from Metro System Revenues for purposes of determining the annual FAB rate:
5.6.1 Proceeds from the issuance of debt for Metro System projects.
5.7 Estimate and Billing Schedule and Year End Adjustment.
5.7.1 The City shall estimate the FAB rates on an annual basis prior to January 15 and provide budget estimates for the upcoming fiscal year to all Parties. The City shall quantify the FAB rates by estimating the quantity of Flow, Strength, and Fixed Capacity Charges for each Party, based on that Party’s Metered Flow for the past year and the cumulative data of sampling for Strength constituents such as COD and TSS over the preceding five years and Fixed Capacities set forth in Exhibit B. If the cumulative five-year Strength data is no longer indicative of discharge from a Party, and a Contract Capacity Transfer has been approved pursuant to Sections 4.4.3.1,
4.4.3.2, or 3.2, then the City may eliminate the previous higher readings subject to the City’s Administrative Approval.
5.7.2 Prior to March 1 of each year the City will provide a mid-year review of the current year’s Metro System Capital Improvement Costs and Operations and Maintenance Costs and offsetting non-operating revenues such as grant or loan proceeds, including fiscal year-end projections and provide such reviews to the Participating Agencies.
5.7.3 The City shall determine the volume of MBC Return on an annual basis and for billing purposes only. The costs of treating MBC Return shall be allocated to the Parties in proportion to their Metered Flow and Strength. If a Party’s Monthly Average Daily Flow plus MBC Return exceeds their Contract Capacity set forth in Exhibit B, it shall not be treated as an exceedance pursuant to Section 4.4.3.1.
5.7.4 The City shall bill the Participating Agencies quarterly, invoicing on August 1, November 1, February 1 and May 1. Each bill shall be paid within thirty (30) days of mailing. Quarterly payments will consist of the total estimated cost for each Participating Agency, based on their estimated Flow, Strength, and Fixed Capacity Charges, divided by four.
5.7.5 At the end of each fiscal year, the City shall determine the actual Metro System Costs and the actual Metered Flow as well as the cumulative Strength data for the City and ATTACHMENT B 150 July 7, 2026 Item 4
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each of the Participating Agencies. The City shall make any necessary adjustments to the unit rates for Flow and Strength such as COD, TSS and Fixed Capacity Charges based on actual costs for the year as determined through the annual audit process in Section 5.8.2 of this Agreement. The City shall then recalculate the FAB rate for the year using actual audited costs for the year, actual Metered Flow, Residuals, MBC Return, cumulative Strength factors, and Fixed Capacity Charges for the City and for each Participating Agency. The City shall credit any future charges or bill for any additional amounts due against the quarter after the prior year costs have been audited.
5.8 Financial Statements.
5.8.1 The City shall keep records and accounts of all costs and expenses relating to conveyance, treatment, disposal, and reuse of wastewater, and production of Repurified Water, and the acquisition, planning, design, construction, administration, monitoring, operation and maintenance of the Metro System and Water Repurification System, and any grants, loans, or other revenues received therefor. The City shall keep such records and accounts for at least four (4) years after the completed audit, or for any longer period required by law or outside funding sources.
5.8.2 Annual Audit. Said records and accounts shall be subject to reasonable inspection by any authorized representative of any Participating Agency at its expense. Further, said accounts and records shall be audited annually by an independent certified public accounting firm appointed by the City. A copy of said report shall be available to any Participating Agency.
As part of said audit, the actual amount of City Water Utility’s PW Costs, Pure Water Program costs attributable to the Metro System, Repurified Water Revenue, and the Capital Expense Rate shall be determined and audited by the City’s external auditors and Participating Agency representatives, and a cumulative and annual summary of such amounts shall be included as a footnote or attached to the audit of the Metro System. Cost summaries shall include separate lines for Capital Improvement Costs and Operation and Maintenance Costs.
5.8.3 The City shall make a good faith effort to complete the annual audit, and any related adjustments under this Agreement as described in Section 5.8.2, by the end of the following fiscal year.
5.9 Debt Financing. The City retains the sole right to determine the timing and amount of debt financing required to provide Metro System Facilities. The annual debt service plus inprogress Capital Improvement Costs to maintain capacity in and of the Metro System shall be allocated to the Participating Agencies consistent with the Exhibit B Contract Capacity allocations effective on the date the debt is issued. If a Participating Agency wishes to prepay Capital Improvement Costs, and the City is able to accommodate such a request, then a Participating Agency may prepay their proportional share of Capital Improvement Projects. If a Participating Agency wishes to withdraw or reduce their Flows and/or Strengths from the Metro System per Section 2.3.3 of this Agreement, such agency will remain responsible for its pro-rata share of all outstanding debt incurred at the time the debt was issued until it is satisfied, irrespective of withdrawal, reduction in Flows and/or Strengths, or Agreement expiration. If the City refunds debt, it shall allocate such refunds consistent with the Exhibit B Contract Capacity allocations effective on the date the debt was issued.
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5.10 Allocation of Operating Reserves and Debt Service Coverage. The Parties shall continue to comply with the protocol set forth in Exhibit C, Administrative Protocol on Allocation of Operating Reserves and Debt Service Coverage to Participating Agencies, which exhibit may be amended from time to time consistent with Section 5.11.
5.11 Amending the System of Charges. Except as otherwise provided in Section 5.2.1.63, the Parties may amend any provision in this Section 5 regarding the Finance, Budgeting, and Accounting System of Charges in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15.
6. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 1
6.1 North City Water Reclamation Plant Modification. As part of Phase 1 of the Pure Water Program, the City intends to modify the North City Water Reclamation Plant (a Metro System facility) and expand its capacity to 52 MGD. In addition, the City intends to construct the North City Pure Water Facility on a nearby site to produce Repurified Water. This Section sets forth the costs and revenues associated with the Pure Water Program attributable to the Metro System. Exhibit A includes current constructed Metro System facilities and existing and proposed future Phase 1 facilities.
6.2 New, Expanded or Modified Metro System Facilities. Each new, expanded, or modified Metro System facility, which is part of the Pure Water Program, and is used in relation to the production of Repurified Water (in addition to the modification and expansion of the North City Water Reclamation Plant) shall be governed by this Section.
6.3 Costs Excluded from Metro System Costs – Phase 1. All of the following Pure Water Program costs, including Capital Improvement Costs, Operation and Maintenance Costs, and other related costs (including administration, insurance, claims, and overhead) shall be excluded from Metro System Costs for purposes of calculating the annual FAB rate.
6.3.1 General Exclusions:
6.3.1.1 Costs of the Water Repurification System and any Metro System facilities to the extent constructed, modified, expanded, or used for the purpose of treating wastewater beyond secondary treatment (ocean discharge standard under current law). This shall include costs for preliminary treatment, primary treatment, and secondary treatment to the extent such costs are higher than they would otherwise be due to the production of Repurified Water.
6.3.1.2 Costs for fail-safe disposal, if necessary, for design capacity for Repurified Water, including, but not limited to, any costs associated with the reservation of capacity at the Point Loma Wastewater Treatment Plant.
6.3.1.3 Costs for the demolition or replacement of existing Metro System facilities with similar facilities for the purpose of making space available for Water Repurification System facilities. Such costs may consider the current asset value or market value of the existing Metro System facility.
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6.3.2 Cost Exclusions Specific to North City Water Reclamation Plant Improvements:
6.3.2.1 Costs for increased aeration tank volume to the extent the new volume exceeds the amount necessary to provide 52 MGD capacity. Determination of sizing to provide 52 MGD capacity shall be based on the current tank volume necessary to provide 30 MGD capacity.
6.3.2.2 Costs for the methanol feed system.
6.3.2.3 Costs for RSDP disposal, including, but not limited to, pump stations, pipelines, retreatment, ocean outfall, and monitoring.
6.3.2.4 Costs for the use of existing tertiary water filters for Repurified Water purposes. Such costs may consider the depreciated value of such filters or use such other appropriate valuation methods as agreed by the City and authorized representatives of the Metro JPA. Costs under this section shall be reimbursed or credited by City’s Water Utility to the Metro System.
6.4 North City Water Reclamation Plant Improvement Costs Included as Metro System Costs. Notwithstanding the above exclusions, the City and the Participating Agencies have specifically agreed that the following Capital Improvement Costs and Operation and Maintenance Costs related to North City Water Reclamation Plant improvements shall be included as Metro System Costs for purposes of calculating the annual FAB rate (and therefore not qualify as City Water Utility PW Costs):
6.4.1 Costs for chemically enhanced primary treatment for up to 52 MGD capacity.
6.4.2 Costs for primary effluent equalization for up to 52 MGD capacity.
6.4.3 Costs for increased volume of aeration tanks that will provide up to, but not exceeding, 52 MGD capacity.
6.4.4 Costs to add secondary clarifier tanks sufficient for up to 52 MGD capacity.
6.4.5 Costs for wastewater conveyance facilities to provide wastewater for replacement of Centrate flows that cannot be treated at the North City Water Reclamation Plant due to the production of Repurified Water.
6.4.6 Costs for treatment and conveyance of all MBC Return (micro-filtration and tertiary backwash) based on Flow, COD, and TSS.
6.5 Reallocation of PWP Costs incurred since FY 2014.
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6.5.1 The allocation of Pure Water Program costs, retroactive to June 30, 2014, will be calculated the year the Agreement goes into effect, will be completed no less than two fiscal years following the production of 30 MGD by Phase 1 of the Pure Water Program.
6.5.1.1 All the O&M task orders, or costs that cannot be directly assigned to a PWP Phase 1 capital improvement project such as program management, environmental documents, etc., will be reallocated by the final water/wastewater cost split, and will include interest accruing since June 2014 at the interest rate earned by the City of San Diego for each applicable fiscal year as shown by the sample interest calculation included in Exhibit G, Sample of Interest Calculation. This postpones the reconciliation of costs until the substantial completion of all construction projects for Phase 1 (City Water Utility PW Costs and Metro). This reconciliation will be performed during the audit of the fiscal year in which substantial completion of all projects occurs.
6.5.1.2 All Phase 1 PWP CIP projects were bid and awarded by October 2022 which is FY2023. All shared Phase 1 CIP projects will be reallocated to the actual construction cost split once the project is awarded, and the cost loaded CPM is completed and negotiated between the City and the Participating Agencies during the FY2023 audit. All CIP soft costs incurred since 2014 will be reallocated like the O&M task orders during the audit of the year of substantial completion of the actual Phase 1 CIP projects. If interest is owed to the Metro System for soft costs starting in FY 2014, such interest shall be considered Metro System Revenues consistent with Section 5.5.5.
6.6 Revenue Sharing for Repurified Water.
6.6.1 Background. Initially, the Parties anticipate that the cost per acre foot associated with the production of Repurified Water will be more expensive than the cost per acre foot of untreated imported water. However, it is anticipated that Repurified Water produced under Phase 1 will be less expensive than untreated imported water sometime in the future. Once Repurified Water produced under Phase 1 becomes less expensive than the cost of untreated imported water, the Parties agree that there will be revenue from the Pure Water Program.
6.6.2 Calculation. Revenue sharing shall occur in each fiscal year during which the annual cost per acre foot associated with the production of Repurified Water is less than the cost of untreated water per acre foot from the San Diego County Water Authority (“CWA”). The annual cost difference shall be known as “Repurified Water Revenue.” Repurified Water Revenue shall be determined as follows:
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Annual cost per acre foot of CWA untreated water purchased by the City for delivery at Miramar Reservoir (which shall be determined based on the total costs for water actually billed to the City by CWA for water delivered at Miramar Reservoir in a fiscal year, divided by the number of acre-feet of CWA water delivered at Miramar Reservoir that year)
less
Annual cost per acre-foot of City Water Utility PW Costs (which shall be determined based on total annual City Water Utility PW Costs divided by the number of acre-feet of Repurified Water actually produced in that year) the result of which is multiplied by
The number of acre feet of Repurified Water produced by Pure Water Program facilities during the applicable fiscal year.
Exhibit H, Summary of Billings from County Water Authority Showing Costs for Untreated Water, is a summary of the most recent CWA rate structure and cost allocations to the City of San Diego for untreated water. The Parties agree that Exhibit H shall be referred to by the Parties in the future in determining how costs for water delivered at Miramar Reservoir are calculated. If no untreated water is delivered at Miramar Reservoir in a given year, then the closest point of delivery of untreated water to the City shall be used. The City shall annually update Exhibit H to reflect the most recent CWA rate structure and cost allocations to the City of San Diego.
The City shall estimate whether there will be Repurified Water Revenue in the upcoming fiscal year prior to January 15 of each year, and these amounts shall be incorporated into the budget estimates for the upcoming fiscal year to all Parties.
6.6.3 Revenue Sharing. Repurified Water Revenue shall initially be shared between the City’s Water Utility and the Metro System based on the relative actual Capital Improvement Costs for the Pure Water Program contributed by City’s Water Utility and the Metro System. Such Capital Improvement Cost contributions are currently estimated as 62% City’s Water Utility and 38% Metro System. The Metro System’s portion of the Repurified Water Revenue shall be applied to debt attributable to the Metro System first, until the debt attributable to the Metro System is fully paid.
Following full payment of debt attributable to the Metro System, Repurified Water Revenue shall be shared based on the relative actual Operation and Maintenance Costs for Pure Water Program facilities contributed by City’s Water Utility and the Metro System, calculated annually. Such Operation and Maintenance Costs are currently estimated as 76% City’s Water Utility and 24% Metro System on an annual basis.
In all instances referred to in this Section 6.6.3, the Metro System portion of the Repurified Water Revenue shall be allocated among the City and the Participating Agencies consistent with Section 4.4.2.
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6.6.4 Year-End Adjustment. At the end of each fiscal year during which there is Repurified Water Revenue, the City shall determine the actual cost per acre foot of CWA untreated water purchased by the City, the actual cost per acre foot of City Water Utility PW Costs, and the actual amount of Repurified Water produced at Pure Water Program facilities.
Based on the actual cost and production information, the City will recalculate the Repurified Water Revenue for the prior fiscal year. The City will credit any future charges or bill for any additional amounts due the quarter after the prior year costs have been audited.
6.6.5 Change in Potable Reuse Method. The Parties acknowledge that the Pure Water Program Phase 1 will initially use indirect potable reuse surface water augmentation. The use of CWA untreated water costs in calculating Repurified Water Revenue is intended to provide an appropriate point of comparison to costs for producing Repurified Water that will be introduced into surface water. The Parties agree that if the City desires to implement direct potable reuse (in which Repurified Water would be introduced directly into a water supply pipeline or facility), the Parties shall meet and negotiate in good faith regarding an amendment to this Section 6.6, to appropriately update the formula for Repurified Water Revenue, which form of amendment shall occur via an Administrative Agreement and shall be subject to the Joint Administrative Approval Process set forth in Section 15.
6.7 Capital Expense Rate.
6.7.1 Background. The Point Loma Wastewater Treatment Plant operates under a National Pollutant Discharge Elimination System (“NPDES”) permit modified under section 301(h) & (j)(5) of the Clean Water Act. If such modified permit were ever revoked or not renewed, the Parties agree that, under current law, the City would have an obligation to upgrade the PLWTP to secondary treatment. The Parties further agree that $1.8 billion is a fair and comprehensive estimation of the costs that could be incurred by the Metro System to meet the legal requirements related to the Metro System under current law. The estimate of $1.8 billion is based on the net present value of the capital cost to develop 180 MGD of secondary treatment at PLWTP as of November 15, 2018.
Therefore, the Parties agree that $1.8 billion represents the maximum amount of Capital Improvement Costs that the Metro System should be obligated to contribute to the Pure Water Program, the purpose of which is not solely the disposal of wastewater, but also the production of Repurified Water. The Parties agree that this $1.8 billion maximum contribution should apply whether or not the PLWTP is actually upgraded to secondary treatment to meet legal requirements in the future because, as of the date of the Agreement, the Parties have the option of upgrading the PLWTP to full secondary treatment for the cost of approximately $1.8 billion.
In light of the above, the Parties have agreed that if Metro System costs related to the Pure Water Program exceed the $1.8 billion, City’s Water Utility will pay a charge for each acre foot of secondary treated effluent produced by Metro System facilities and used for the production of Repurified Water.
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6.7.2 Capital Expense Rate. Under the circumstances described in this Section 6.7, City’s Water Utility shall pay a charge (“Capital Expense Rate”) for each acre-foot of secondary treated effluent produced by Metro System facilities and used for the production of Repurified Water. The Capital Expense Rate costs or revenues attributable to the Metro System shall be assessed or credited consistent with Section 4.4.2. City’s Water Utility shall pay the Capital Expense Rate if the following costs alone, or in combination, exceed $1.8 billion (which amount shall be adjusted for inflation):
6.7.2.1 The sum of all Capital Improvement Costs and associated debt attributable to the Metro System components of the Pure Water Program under this Section 6.7.2; and/or
6.7.2.2 The sum of all Capital Improvement Costs and associated debt for the full or partial upgrading of the PLWTP to secondary treatment.
Notwithstanding the above, the Capital Expense Rate shall not apply if the PLWTP is actually upgraded to secondary treatment (or beyond) due to: (a) a change in federal or state statutory law making it necessary to upgrade the PLWTP to comply with such new discharge standard; or (b) a final decision by a state or federal court or a federal administrative agency of competent jurisdiction that an NPDES permit modified under section 301(h) & G)(5) of the Clean Water Act is thereby revoked or denied renewal due to a finding that the discharge from the PLWTP violates anti-degradation rules or regulations promulgated under section 403 of the Clean Water Act.
6.7.3 Calculation of Capital Expense Rate. The amount per acre-foot of the Capital Expense Rate shall be determined as follows:
The sum of all Capital Improvement Costs and associated debt attributable to (i) the Metro System components of the Pure Water Program under this Section 6 and (ii) upgrading of the PLWTP to secondary treatment (if any) less
$1.8 billion, as adjusted for inflation each July 1 (starting on July 1, 2019) to reflect the annual percentage change in the Engineering News Records – Los Angeles construction cost index
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the result of which is multiplied by
1.42 (which estimates the total interest on a 30-year State Revolving Fund loan with an interest rate of 2.5%)
the result of which is divided by
The total number of acre feet per year of secondary treated effluent that is expected to be produced by Metro System facilities for the production of Repurified Water over a period of thirty (30) years.
The City shall estimate whether the Capital Expense Rate shall apply to the upcoming fiscal year (and its amount) prior to January 15 of each year, and the estimated amount of the Capital Expense Rate shall be effective on July 1 of the upcoming fiscal year.
For purposes of this Section 6.7.3, Capital Improvement Costs and associated debt shall include such costs and revenue incurred by the Metro System prior to the effective date of the Agreement.
6.7.4 Year-End Adjustment. At the end of each fiscal year during which the Capital Expense Rate applies, the City shall determine the actual Capital Improvement Costs and associated debt attributable to the Metro System components of the Pure Water Program under this Section 6 and any upgrading of the PLWTP to secondary treatment, and the actual amount of secondary treated effluent produced by Metro System facilities and used for the production of Repurified Water.
Based on the actual cost, interest, and effluent information, the City will recalculate the Capital Expense Rate for the prior fiscal year. The City will credit any future charges or bill for any additional amounts due the quarter after the prior year costs have been audited.
6.7.5 Duration; Expiration. The Capital Expense Rate shall continue until the cost difference between (a) the actual sum of Pure Water Program Capital Improvement Costs and associated debt attributable to the Metro System under Section 6.7 and/or the costs to upgrade the PLWTP and (b) $1.8 billion (as adjusted for inflation), has been fully paid, or the Agreement expires, whichever is sooner. Notwithstanding, it is the express intent and desire of the City and the Participating Agencies that if the Agreement expires before the cost difference has been paid through the Capital Expense Rate, that the Capital Expense Rate continue in any extension of this Agreement negotiated by the Parties pursuant to Section 14.2 until the cost difference has been fully paid.
6.8 Amending Pure Water Program Cost Allocation and Revenues – Phase 1. Except as otherwise provided in Section 6.6.2, the Parties may amend any provision in this Section 6 regarding the Finance, Budgeting, and Accounting for the Pure Water Program Cost Allocation and Revenues for Phase 1 in an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15.
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7. FINANCE, BUDGETING, AND ACCOUNTING: PURE WATER PROGRAM COST ALLOCATION AND REVENUES – PHASE 2
7.1 Pure Water Program – Phase 2. The Second Phase of the Pure Water Program (“Phase 2”) shall create up to an additional 53 MGD of Repurified Water at Phase 2 facilities. The Parties agree to incorporate all terms relating to Phase 2 into this Agreement through an Administrative Agreement subject to the Joint Administrative Approval Process set forth in Section 15, subject to the requirements set forth in this Section 7 below.
7.2 Costs Excluded As Metro System Costs.
Costs Excluded from Metro System Costs for Phase 2 shall be identified in an Administrative Agreement subject to the Joint Administrative Approval Process and approvals set forth in Section 15. However, the Administrative Agreement must reflect that all of the following PWP Phase 2 costs, including Capital Improvement Costs, Operation and Maintenance Costs, and other related costs (including administration, insurance, claims, and overhead) shall be excluded from Metro System Costs for the purposes of calculating the annual Phase 2 FAB rate, and shall be City Water Utility PW Costs:
7.2.1 Costs of the Phase 2 Water Repurification System and any Metro System facilities to the extent constructed, modified, expanded, or used for the purpose of treating water beyond secondary treatment (ocean discharge standard under current law). This shall include costs for preliminary treatment, primary treatment, and secondary treatment to the extent such costs are higher than they would otherwise be due to the production of Phase 2 Repurified Water.
7.2.2 Costs for fail-safe disposal, if necessary, for design capacity for Phase 2 Repurified Water, including, but not limited to, any costs associated with the reservation of capacity at the Point Loma Wastewater Treatment Plant.
7.2.3 Costs for the demolition or replacement of existing Metro System facilities with similar facilities for the purpose of making space available for Phase 2 Water Repurification System facilities. Such costs may take into account the current asset value or market value of the existing Metro System facility.
7.2.4 Costs for the Phase 2 methanol feed system.
7.2.5 Costs for Phase 2 RSDP disposal including, but not limited to, pump stations, pipelines, retreatment, ocean outfall, and monitoring.
7.2.6 50% of the costs for the MBR Tanks and system for Phase 2.
7.2.7 All membrane integrity monitoring systems for Phase 2.
7.2.8 All Phase 2 systems downstream of MBR’s.
7.3 Revenue Sharing for Repurified Water – Phase 2. Terms regarding revenue sharing for Repurified Water for Phase 2 shall be identified in an Administrative Agreement subject to the ATTACHMENT B 159 July 7, 2026 Item 4
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Joint Administrative Approval Process set forth in Section 15. However, this Administrative Agreement must reflect terms related to Phase 2 revenue sharing for Repurified Water that conceptually mimic those terms set forth in Section 6.6. The Metro System portion of the Repurified Water Revenue for Phase 2 shall be allocated among the City and the Participating Agencies consistent with Section 4.4.2, as may be amended or updated to account for changes in PWP Phase 2.
7.4 Capital Expense Rate – Phase 2. Terms regarding the Capital Expense Rate for Phase 2 shall be identified in an Administrative Agreement subject to the Joint Administrative Approval Process and approvals set forth in Section 15. However, this Administrative Agreement must reflect terms that conceptually mimic the terms in Section 6.7, reflecting a continuation of the Capital Expense Rate through Phase 2 up until the PWP achieves up to 83 MGD of Repurified Water, taking into account production of water suitable for potable reuse occurring at all treatment processes for wastewater upstream from and at the PLWTP. The Pure Water Program Capital Expense Rate costs or revenues attributable to the Metro System shall be assessed or credited consistently with Section 4.4.2, as may be amended or updated to account for changes in PWP Phase 2.
8. FUTURE NEGOTIATIONS AND COOPERATION
This Agreement specifically contemplates Phase 1 and Phase 2 of the Pure Water Program, which consists of new, expanded, or modified Metro System and Water Repurification System facilities projected to produce up to 83 million gallons per day of Repurified Water. The Parties intend to meet and negotiate in good faith regarding the referenced Administrative Agreements identified in this Agreement. All items outside the scope of the Joint Administrative Approval Process shall be negotiated by the Parties through the amendment processes described in Section 16.3, if necessary.
9. THE METRO COMMISSION
9.1 Establishment and Membership. The 1998 Agreement created and established (and the ARA reestablished) the Metro Commission as a commission consisting of one representative from each Participating Agency. On October 25, 2000, the Participating Agencies entered into a Joint Exercise of Power Agreement which created a separate public entity, the Metro Wastewater Joint Powers Authority (“Metro JPA”), for the purpose, among others, of taking responsibility, actions, and making decisions pertaining to the 1998 Agreement on behalf of the Participating Agencies. The Metro Commission and the Metro JPA are and shall hereinafter be treated as one and the same entity for all intents and purposes under this Agreement, including for the purpose of accepting and executing the responsibilities delegated to the Metro JPA in this Agreement. Each Participating Agency shall have the right to appoint a representative of its choice to the Metro Commission/Metro JPA, and the Participating Agency’s appointee to the Metro Commission shall also serve as that Participating Agency’s representative on the Metro JPA Board of Directors. If a Participating Agency is a dependent district whose governing body is that of another independent public agency, that Participating Agency shall be represented on the Metro Commission/Metro JPA by a representative appointed by the governing body which shall have no more than one representative no matter how many Participating Agencies it governs. Each member ATTACHMENT B 160 July 7, 2026 Item 4
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has one vote in any matter considered by the Metro Commission/Metro JPA. The Metro Commission/Metro JPA shall establish its own meeting schedule and rules of conduct. The City may participate in the Metro Commission on an ex officio, non-voting basis. To the extent this Agreement expands or amends the powers or purposes set forth in the Metro JPA Joint Exercise of Powers Agreement, the Participating Agencies expressly agree to such expansion or amendment consistent with the terms of this Agreement.
9.2 Advisory Responsibilities of Metro JPA.
9.2.1 The Metro JPA shall act as an advisory body to the Mayor and City Council on policy issues and matters affecting and relating to the Metro System and shall be included in the City’s list of boards and commissions on the City’s website. The City shall present the position of the majority of the Metro JPA to the City’s governing body in written staff reports. The Metro JPA may prepare and submit materials in advance and may appear at any City hearings on Metro System matters and present its position to the governing body of the City.
9.2.2 The Metro JPA may advise the City of its position on any issue relevant to the Metro System.
9.3 Delegation of Decision-Making Authority of the Metro JPA. The Participating Agencies hereby delegate to the Metro JPA the authority to take certain actions pursuant to the approval processes provided in this Agreement, as permitted by law, including but not limited to Government Code 6506. The Participating Agencies agree that the Metro JPA has delegated authority to approve Administrative Agreements on behalf of each Participating Agency pursuant to the process set forth in Section 15. The Participating Agencies agree and acknowledge that the Metro JPA has authority to bind each Participating Agency to Administrative Agreements through the Joint Administrative Approval Process. All Participating Agencies agree to promptly execute Administrative Agreements after approval by the Metro JPA. By signing this Agreement, each Participating Agency is expressly preapproving such actions.
9.4 Standing. If a dispute arises among the Parties relating to or arising from a Party’s obligation under this Agreement or an associated Administrative Agreement, the Metro JPA shall have standing to enforce the terms of this Agreement against the City on behalf of two or more Participating Agencies if a majority of the Metro JPA votes to take action relating to this Agreement on behalf of two or more Participating Agencies.
10. DISPUTE RESOLUTION
This Section governs all disputes arising out of this Agreement and any associated Administrative Agreements.
10.1 Mandatory Non-Binding Mediation. If a dispute arises among the Parties relating to or arising from a Party’s obligations under this Agreement or an associated Administrative Agreement that cannot be resolved through informal discussions and meetings, the Parties involved in the dispute shall first endeavor to settle the dispute in an amicable manner, using mandatory non-binding mediation under the rules of JAMS, AAA, or any other neutral ATTACHMENT B 161 July 7, 2026 Item 4
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organization agreed upon by the Parties before having recourse in a court of law. Mediation shall be commenced by sending a Notice of Demand for Mediation to the other Party or Parties to the dispute. A copy of the notice shall be sent to the City, all other Participating Agencies, and the Metro JPA.
10.2 Selection of Mediator. A single mediator that is acceptable to the Parties involved in the dispute shall be used to mediate. The mediator will be knowledgeable in the subject matter of this Agreement, if possible, and chosen from lists furnished by JAMS, AAA, or any other agreed upon mediator.
10.3 Mediation Expenses. The expenses of witnesses for either side shall be paid by the Party producing such witnesses. All mediation costs, including required travel and other expenses of the mediator, and the cost of any expert advice produced at the direct request of the mediator, shall be Metro System costs.
10.4 Conduct of Mediation. Mediation hearings will be conducted in an informal manner. Discovery shall not be allowed. The discussions, statements, writings and admissions and any offers to compromise during the proceedings will be confidential to the proceedings (pursuant to California Evidence Code sections 1115 - 1128 and 1152) and will not be used for any other purpose unless otherwise agreed by the Parties in writing. The Parties may agree to exchange any information they deem necessary. The Parties involved in the dispute shall have representatives attend the mediation who are authorized to settle the dispute, though a recommendation of settlement may be subject to the approval of each agency’s boards or legislative bodies. Either Party may have attorneys, witnesses or experts present.
10.5 Mediation Results. Any resultant agreements from mediation shall be documented in writing. The results of the mediation shall not be final or binding unless otherwise agreed to in writing by the Parties. Mediators shall not be subject to any subpoena or liability and their actions shall not be subject to discovery.
10.6 Performance Required During Dispute. Nothing in this Section shall relieve the City and the Participating Agencies from performing their obligations under this Agreement. The City and the Participating Agencies shall be required to comply with this Agreement, including the performance of all disputed activity and disputed payments, pending the resolution of any dispute under this Agreement.
11. INSURANCE
11.1 City Shall Maintain All Required Insurance.
11.1.1 Throughout the term of this Agreement the City shall procure and maintain in effect liability insurance covering Metro System assets and operations in the same manner, and to the same extent, as the City insures similar assets and operations of the City. Such insurance may be provided through separate policies for the Metro System, or by consolidating the Metro System with other City assets and operations for insurance purposes. If the Metro System is insured separately, policy limits, deductibles, and self-insured retentions shall be equivalent to what the ATTACHMENT B 162 July 7, 2026 Item 4
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City procures for other similar City assets and operations. The City shall maintain all insurance required by law, including workers’ compensation insurance, and may self-insure for certain losses when allowed by law. The proportionate cost of insurance for the Metro System shall be included in the computation of the FAB.
11.1.2 If the Metro System is insured separately, any policy or policies of liability insurance carried by the City for the Metro System shall name the Participating Agencies as additional insureds with evidence of same supplied to each upon request.
11.1.3 Upon request by the Metro JPA or a Participating Agency, the City shall promptly provide written coverage and policy information, including, but not limited to, the scope of coverage, policy limits, deductibles, and self-insured retentions, including information on any claims made against the policies and remaining limits and deductibles.
11.2 Substantially Equivalent Coverage. In the event of a transfer of the Metro System to a nonpublic entity pursuant to Section 2.1, coverage substantially equivalent to all the above provisions shall be maintained by any successor in interest.
12. INTERRUPTION OF SERVICE
Should the Metro System services to the Participating Agencies be interrupted as a result of a major disaster, by operation of federal or state law, or other causes beyond the City’s control, the Participating Agencies shall continue all payments required under this Agreement during the period of interruption.
13. NOTICES REQUIRED UNDER AGREEMENT
The City and each Participating Agency shall give notice when required by this Agreement.
All notices required by this Agreement must be in writing and must be sent via email and either served personally or mailed via first class U.S. mail. The notices shall be sent to the officer listed for each Party, at the address and email address listed for each Party in Exhibit D, Notice Listing, in accordance with this Section. If a Party wishes to change the officer and/or address to which notices are given, the Party shall notify all other Parties in accordance with this Section. Upon such notice, the City shall amend Exhibit D to reflect the changes. The amendment shall be made within sixty (60) days after receipt of the Party’s notice regarding the change in officer and/or address.
The City shall keep an updated version of Exhibit D, notated with the most recent amendment date, on file with the City Public Utilities Department. The City shall provide a copy of the amended Exhibit D to all Parties by no later than sixty (60) days after amending Exhibit D.
14. EFFECTIVE DATE AND EXPIRATION
14.1 Effective Date. ThisOnce all Parties have executed this Agreement, this Agreement shall be considered effective on July 1, 2026 irrespective of the fiscal year commencing after execution by the City and all of the Participating Agencies and shall be dated as of the signature date ofon which the last executing Party. For example, irrespective of whether the last executing Partyparty signs this Agreement on September 1, 2025, January 1, 2026, or June 30, 2026, the effective date of the Agreement would be July 1, 2026..
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14.2 Expiration. Subject to the rights and obligations set forth in Section 14.3, unless amended, replaced, or terminated earlier by mutual consent of all the Parties, this Agreement shall expire on June 30, 2065. This Agreement is subject to extension by agreement of the Parties. The Parties shall commence discussions on an agreement to provide wastewater treatment services beyond the year 2065 on or before December 31, 2055, or at such time, if any, that the PLWTP is required to be upgraded to secondary treatment. The Parties may create, amend or terminate any associated Administrative Agreements addressing implementation of this Agreement, as provided in this Agreement.
14.3 Contract Capacity Rights Survive Expiration. The Participating Agencies’ Contract Capacity rights and rights to obtain wastewater treatment services from the facilities referred to in, or constructed pursuant to this Agreement shall survive the expiration of the Agreement. Provided, however, for any Participating Agency to exercise such rights, the Participating Agency shall comply with all the following requirements: (a) provide at least six months’ written notice prior to the expiration of this Agreement; (b) upon expiration of this Agreement, pay their proportional share of Metro System Costs according to the billing methodologies set forth in this Agreement in order to maintain their right(s) to such wastewater treatment services; and (c) agree to recalculate and pay proportional share of future Metro System Costs based on the City’s and all remaining Participating Agencies’ proportionate shares. In the event this Agreement expires and one or more Participating Agency(ies) continue to pay their proportional share of all Metro System Costs, the City shall have the right to continue managing, operating, and expanding the Metro System subject to the same terms set forth in this Agreement, unless otherwise agreed to in writing by and between the City and a Participating Agency. In the event one or more Participating Agency(ies) exercise its/their right(s) to maintain Contract Capacity and wastewater treatment services, such Participating Agency(ies) shall also maintain the right to continue receiving any and all revenues contemplated by this Agreement, including, but not limited to, Metro System Revenues.
14.4 Abandonment. After June 30, 2065, the City may abandon operation of the Metro System upon delivery of notice to the Participating Agencies ten (10) years in advance of said abandonment. Upon notice by the City to abandon the Metro System, the Parties shall meet and confer over the nature and conditions of such abandonment. In the event the Parties cannot reach agreement, the matter shall be submitted to mediation under Section 10. In the event of abandonment, the City shall retain ownership of all Metro System assets free of any claim of the Participating Agencies. Abandonment by the City with continued operation by a different entity shall not terminate or affect a Contract Capacity rights of a Participating Agency so long as that Participating Agency has continued to pay their proportional share of Capital Improvement Costs and Operation and Maintenance Costs according to the billing methodologies set forth in this Agreement. Nothing in this language shall be construed to require the City to continue as operator of the Metro System after the ten-year (10) notice period has run.
15. ADMINISTRATIVE AGREEMENTS
15.1 Use and Process for Administrative Agreements.
15.1.1 Purpose. Administrative Agreements are intended to implement the intent of the Parties in an efficient and effective manner without reopening or renegotiating the terms of ATTACHMENT B 164 July 7, 2026 Item 4
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this Agreement. Administrative Agreements are limited to addressing issues that are authorized by this Agreement. Administrative Agreements are separate and distinct from Exhibits to this Agreement, and are designed to address procedural, operational, technical, and administrative issues. Terms in this Agreement may only be modified through the Joint Administrative Approval Process if this Agreement expressly authorizes the use of an Administrative Agreement.
15.1.2 Amendments, Supplements, or Successors to Administrative Agreements.
Where this Agreement refers to an Administrative Agreement, such reference shall include any amendment(s) to that Administrative Agreement or supplemental or successor Administrative Agreement(s).
15.1.3 Function. Administrative Agreements are made among all the Parties but deal with a specific function or group of like functions, for the benefit of regional wastewater treatment within the Metro System, or for the implementation of this Agreement.
15.1.4 Current Agreements. The Administrative Agreements which are approved and executed simultaneously with the execution of this Agreement are listed Exhibit I, List of Administrative Agreements. The City shall update Exhibit I each time an Administrative Agreement is approved, amended, revised or terminated pursuant to this Agreement.
15.1.5 Development and Joint Administrative Approval Process. Any Party can present an Administrative Agreement, or an amendment or supplement thereto, or termination thereof, to the City for approval by way of the Joint Administrative Approval Process set forth in this Section. The City will endeavor in good faith to respond within 60 days of submission of a proposed Administrative Agreement. If the City needs additional time to evaluate the proposed Administrative Agreement, it will advise all Participating Agencies in writing of the anticipated review time. Once an Administrative Agreement receives City’s Administrative Approval, then, with respect to the Participating Agencies, the proposed Administrative Agreement may be presented to the Metro JPA at a duly noticed meeting for review and a first reading. Sixty (60) days or more after the first reading, after the Metro JPA Directors have had opportunity to consult with their respective agency staff and governing boards, the Administrative Agreement may be presented at a duly noticed meeting for a second reading and approved upon an affirmative vote by no less than two-thirds of the members of the Metro JPA during a duly noticed public meeting (in other words, upon the affirmative vote of at least eight or more of the twelve members of the Metro JPA, irrespective of how many Metro JPA Directors are present at the meeting, unless the number of Participating Agencies changes).), except that any changes to (i) the FAB, including the Functional Design Methodology required to be approved by way of an Administrative Agreement under Section 5.2.1.3, (ii) how Repurified Water Revenue is shared under Section 6.6, (iii) how the Capital Expense Rate is determined as set forth in Section 6.7; or (iv) how Pure Water Program Cost Allocation and Revenues for Phase 2 are calculated under Section 7, shall require approval by no less than three-quarters of the members of the Metro JPA during a duly noticed public meeting (in other words, upon the affirmative vote of at least nine or more of the twelve members of the Metro JPA, irrespective of how many Metro JPA Director are present at the meeting, unless the number of Participating Agencies changes). If the second reading does not occur within One Hundred and Twenty (120) days after the first reading, the proposed Administrative Agreement shall no longer be taken into consideration, unless the City and the Metro JPA Directors agree to a ATTACHMENT B 165 July 7, 2026 Item 4
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different timeline. An Administrative Agreement, amendment thereto, or termination thereof, must receive City’s Administrative Approval and at least a two-third affirmative vote by the Metro JPA Directors before it can become effective. Administrative Agreements are binding contracts as against the City and all Participating Agencies, irrespective of whether or not any Participating Agency’s particular Metro JPA Director voted to approve the agreement or not, or was absent or abstained. The Metro JPA has the authority to bind the Participating Agencies to Administrative Agreements pursuant to the delegated authority provided to the Metro JPA in Section 9.3 herein.
16. GENERAL
16.1 Exhibits.
16.1.1 Exhibit List. This Agreement references Exhibits A through J. Each exhibit is attached to this Agreement and is incorporated herein by reference. All exhibits to this agreement shall be listed in Exhibit JK, Exhibit List. The City shall update the Exhibit List from time to time each time an Exhibit is amended or revised pursuant to this Agreement.
16.2 Electronic Exhibits and Attachments. Acknowledgement and Acceptance: The Parties hereby acknowledge and agree that the exhibit(s) and attachment(s) related to this Agreement, or any of its associated Administrative Agreements, indicated as an Electronic Exhibits above (collectively, the “Electronic Exhibits”) may be in an electronic format that cannot be readily or accurately converted into a physical or printed form. The Parties expressly agree that such Electronic Exhibits shall nonetheless be deemed to be valid and enforceable attachments to this Agreement and shall be incorporated by reference as if fully set forth herein.
16.2.1 Identification and Access: All Electronic Exhibits shall bear the same Exhibit identifier and name (i.e., Exhibit A – Metro Facilities) set forth in the Exhibit List, and shall be clearly identified as an Electronic Exhibit in the Exhibit List, including a file name, a time stamp of file, and a note indicating the software used to open and view the file, including version.
The Electronic Exhibit shall be loaded on to a CD-ROM, DVD-ROM, or other electronic storage medium that is a write-once medium without the ability to further edit. Each Party shall receive an identical copy of the Electronic Exhibit(s) via identical storage mediums. The City shall ensure that all Participating Agencies have full and unrestricted access to Electronic Exhibits for the duration of the Agreement and any applicable retention period thereafter, including by providing access to any necessary software, applications, or systems required to view, interact with, or manipulate the Electronic Exhibits in their native format; such as through website access via the GIS Online platform: https://sandiego.maps.arcgis.com. No interaction or manipulation of any Electronic Exhibit shall in any way constitute a bona fide change or amendment to the Electronic Exhibit.
16.2.2 Storage and Security: Each Party shall be responsible for securely storing and maintaining the integrity of the Electronic Exhibits in their possession or control. This includes, but is not limited to, implementing and maintaining reasonable and appropriate technical, administrative, and physical safeguards to protect the confidentiality, availability, and integrity of the Electronic Exhibits, and to prevent unauthorized access, disclosure, alteration, or destruction thereof.
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16.2.3 Authentication and Admissibility: The Parties hereby stipulate and agree that the Electronic Exhibits shall be deemed to be original documents and authentic for all purposes under applicable law, and that the Parties may rely upon and introduce such Electronic Exhibits as evidence in any proceeding arising out of or relating to this Agreement, without the need for further foundation, authentication, or certification.
16.2.4 Receipt and Completeness: Each Party hereby acknowledges and confirms that they have received, reviewed, and had a reasonable opportunity to inspect all Electronic Exhibits that are attached to and incorporated into this Agreement as of the Effective Date. By executing this Agreement, each Party represents and warrants that, to the best of their knowledge, the Electronic Exhibits are complete, accurate, and free from material errors, omissions, or defects.
The Parties further agree to notify the other Party promptly upon discovering any discrepancies or inaccuracies in the Electronic Exhibits, and to cooperate in good faith to resolve any such issues in a timely manner.
16.2.5 Amendments and Modifications to Electronic Exhibits: Any amendments or modifications to the Electronic Exhibits shall be made in accordance with the procedures set forth in this Agreement for amending or modifying the terms and conditions hereof, and any such amended or modified Electronic Exhibits shall be deemed to replace and supersede any prior version thereof. Amended Electronic Exhibits shall also be loaded onto a new and separate CDROM, DVD-ROM, or other electronic storage medium that is a write-once medium without the ability to further edit. Each Party shall receive identical copies of the Electronic Exhibits via identical storage mediums. Amended Electronic Exhibits shall bear identical Exhibit Identifiers as their predecessor exhibits, but with a different suffix (for example, Exhibit A, when amended, shall be identified as Exhibit A-1, a subsequent amendment shall be identified as Exhibit A-2, etc.).
16.3 Amendments to Agreement. There shall be four (4) ways to amend, modify, and/or change the terms set forth in this Agreement:
16.3.1 Amendments. Except as set forth in Sections 16.3.2, 16.3.3, and 16.3.4, amendments to this Agreement require the approval of all Parties. Such amendments must be in writing and signed by a duly authorized representative from each Party. Unless specifically referenced as being subject to one of the approval mechanisms set forth in Sections 16.3.2, 16.3.3, or 16.3.4 below, any amendment, modification, and/or changes to the terms of this Agreement must occur pursuant to this Section 16.3.1. This provision controls over all other provisions in this Agreement.
16.3.2 Joint Administrative Approval Process. As set forth in this Agreement, the Joint Administrative Approval Process requires the approval described in Section 15.1.5. The following actions may be taken subject to the Joint Administrative Approval Process:
(a) Agreements for New Contract Capacity as specifically set forth in Section 3.3
(b) Addition of new Metro Facilities or conversion of City facility to a Metro facility as specifically set forth in Section 4.2 ATTACHMENT B 167 July 7, 2026 Item 4
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(c) Changes to Exhibit E (Methodology for Contract Capacity Transfers)
(d) Revisions to FAB as specifically set forth in Section 5.2.1.3, except as provided therein
(e) Changes to Finance, Budgeting, and Accounting System of Charges as specifically set forth in Section 5.11
(f) Changes to Costs Excluded from Metro System Costs – Phase 1 as specifically set forth in Section 6.3
(g) Amending the formula for Repurified Water Revenue as specifically set forth in Section 6.6.2
(h) Changes to Finance, Budgeting, and Accounting for the Pure Water Program Cost Allocation and Revenues for Phase 1 as specifically set forth in Section 6.8
(i) Certain terms relating to Phase 2 as specifically set forth in Section 7.1
(j) Changes to Costs Excluded from Metro System Costs – Phase 2 as specifically set forth in Section 7.2
(k) Terms regarding revenue sharing for Repurified Water for Phase 2 as specifically set forth in Section 7.3
(l) Terms regarding the Capital Expense Rate for Phase 2 as specifically set forth in Section 7.4
(m) Creation, changes, amendments, modifications to, or terminations of any Administrative Agreements as specifically set forth in Article 15.
16.3.3 Two-Party Approval. As set forth in this Agreement, Two-Party Approval requires the City’s Administrative Approval and a two-thirds (2/3) vote or greater of the Metro JPA Directors present at a duly noticed Metro JPA public meeting. The following actions may be taken subject to Two-Party Approval:
(a) Determinations regarding liability as specifically set forth in Section 2.5.5
(b) Contract Capacity Transfers – Decreases as specifically set forth in Section 4.4.3.2
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(c) Changes to Strength measurements as specifically set forth in Section 4.5.2
16.3.4 City Administrative Approval. As set forth in this Agreement, the City’s Administrative Approval requires discussion, evaluation, and approval by the Director of the City of San Diego’s Public Utilities Department or their designee. The City may, in the City’s sole discretion, refer a decision subject to the City’s Administrative Approval to the City Council for a recommendation, approval, or other action. No action is required on the part of a Participating Agency. The following actions may be taken subject to the City’s Administrative Approval:
(a) Transfers of Contract Capacity as specifically set forth in Section 3.2
(b) Reductions in Metro System Capacity as specifically set forth in Section 3.4
(c) Amending Exhibit B as specifically set forth in Section 3.6 (d) Amending Exhibit A as specifically set forth in Section 4.2 (e) Contract Capacity Transfers – Increases as specifically set forth in Section 4.4.3.1
(f) Changes to Exhibit F (Metro System Flow Formulas and Sampling Locations) as specifically set forth in Section 4.5.1
(g) Changes to FAB to include measurements required by law as specifically set forth in Section 5.2.1.3
(h) Changes to Exhibit H if CWA changes their rate structure as specifically set forth in Section 6.6.2
(i) Changes to Exhibit D (Notice) as specifically set forth in Section 13.
16.4 Construction of Agreement.
16.4.1 Drafting of Agreement. It is acknowledged that the City and the Participating Agencies, with the assistance of competent counsel, have participated in the drafting of this Agreement and that no ambiguity should be construed for or against the City or any Participating Agency on account of such drafting.
16.4.2 Entire Agreement. The City and each Participating Agency represent, warrant and agree that no promise or agreement not expressed herein has been made to them, that this Agreement contains the entire agreement between the Parties, that this Agreement supersedes any and all prior agreements or understandings between the Parties unless otherwise provided herein, and that the terms of this Agreement are contractual and not a mere recital; that in executing this Agreement, no Party is relying on any statement or representation made by the other Party, or ATTACHMENT B 169 July 7, 2026 Item 4
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the other Party’s representatives concerning the subject matter, basis or effect of this Agreement other than as set forth herein; and that each Party is relying solely on its own judgement and knowledge.
16.4.3 Agreement Binding on All; No Third-Party Beneficiaries. This Agreement shall be binding upon and shall inure to the benefit of each of the Parties, and each of their respective successors, assigns, trustees or receivers. All the covenants contained in this Agreement are for the express benefit of each and all such Parties. This Agreement is not intended to benefit any third parties, and any such third-party beneficiaries are expressly disclaimed.
16.4.4 Severability.
16.4.4.1 Should any provision of this Agreement or any associated Administrative Agreement be held invalid or illegal, such invalidity or illegality shall not invalidate the whole of the Agreement, but, rather, the Agreement shall be construed as if it did not contain the invalid or illegal part, and the rights and obligations of the Parties shall be construed and enforced accordingly except to the extent that enforcement of the Agreement without the invalidated provision would materially and adversely frustrate either the City’s or a Participating Agency’s essential objectives set forth in this Agreement or the applicable Administrative Agreement.
16.4.4.2 Should a court determine that one or more components of the allocation of costs set forth in this Agreement or any associated Administrative Agreement places the City or a Participating Agency in violation of Article XIII D, Section 6 of the California Constitution with respect to their ratepayers, such components shall no longer be of force or effect.
In such an event, the City and the Participating Agencies shall promptly meet to renegotiate the violative component of the cost allocation to comply with Article XIII D, Section 6 of the California Constitution, and use the dispute resolution process in Section 10 of this Agreement if an agreement cannot be reached through direct negotiation.
16.4.4.3 Should a state or federal agency provide a final, written determination that the method of allocating Pure Water Program Capital Improvement Costs under this Agreement violates the requirements of state or federal grants or loans which are, or will be, used to fund the wastewater components of the Pure Water Program, such allocation method will no longer be of any force or effect. In such an event, the allocation of Repurified Water Revenue and the Capital Expense Rate will continue to be based on the Parties’ actual payments to fund the Pure Water Program Capital Improvement Costs attributable to the Metro System. The City and the Participating Agencies shall also promptly meet to negotiate an alternative cost allocation method that would comply with such grant or loan funding requirements.
16.4.5 Choice of Law. This Agreement and any of its associated Administrative Agreements shall be construed and enforced pursuant to the laws of the State of California.
16.4.6 Recognition of San Diego Sanitation District as Successor to Certain Parties. The Parties hereby acknowledge and agree that the San Diego County Sanitation District is a Participating Agency under this Agreement as the successor in interest to the Alpine Sanitation ATTACHMENT B 170 July 7, 2026 Item 4
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District, East Otay Mesa Sewer Maintenance District, Lakeside Sanitation District, Spring Valley Sanitation District, and Winter Gardens Sewer Maintenance District.
16.5 Declarations Re: Agreement.
16.5.1 Understanding of Intent and Effect of Agreement. The Parties expressly declare and represent that they have read the Agreement and that they have consulted with their respective counsel regarding the meaning of the terms and conditions contained herein. The Parties further expressly declare and represent that they fully understand the content and effect of this Agreement and they approve and accept the terms and conditions contained herein, and that this Agreement is executed freely and voluntarily.
16.5.2 Warranty Regarding Obligation and Authority to Enter Into This Agreement. Each Party represents and warrants that its respective obligations herein are legal and binding obligations of such Party, that each Party is fully authorized to enter into this Agreement, and that the person signing this Agreement hereinafter for each Party has been duly authorized to sign this Agreement on behalf of said Party.
16.6 Right to Make Other Agreements. Nothing in this Agreement limits or restricts the right of the City or the Participating Agencies to make separate agreements among themselves, including through joint powers agreements, without the need to amend this Agreement, provided that such agreements are consistent with this Agreement. Nothing in this Agreement or Section 6 limits or restricts the right of the City or the Participating Agencies to enter into separate agreements regarding the industrial pretreatment program, or for the purchase or sale of Repurified Water produced by the Water Repurification System, or sharing in City Water Utility PW Costs; however, such agreements shall not affect the cost allocation and Metro System revenues delineated in Section 5.
16.7 Statute of Limitations to Resolve Billing Issues. Notwithstanding any longer statute of limitations in State law, if the City or a Participating Agency wishes to dispute a bill (including, but not limited to, an audited bill or an audit reconciliation) on the basis of an alleged overpayment or underpayment arising under this Agreement, the Party alleging the dispute must provide written notice regarding the disputed bill to all Parties to this Agreement promptly upon discovery of such a billing issue. The written notice shall invoke or reference this Section. The Parties agree that such refunds or collections shall not accrue for more than three (3) years from the date that such billing is received by the Participating Agency, or one (1) year from the date that an audited reconciliation is received by the Participating Agency, whichever date is later. The City and the Participating Agencies hereby waive any applicable statute of limitations available under State law that exceed the time frames set forth in this Section 16.7. Upon receipt of the written notice regarding the billing dispute, any Participating Agency wishing to participate in the resolution of the dispute shall be allowed to do so and to present evidence to all Parties in support of their position. The involved Parties’ determination regarding the outcome of the billing dispute, including any related adjustments to each Participating Agency’s share of net Metro System costs or revenues resulting from the resolution of such billing issues, shall be final. Nothing in this section relieves a Participating Agency from its obligations to make timely payments under this ATTACHMENT B 171 July 7, 2026 Item 4
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Agreement irrespective of whether or not a bill is being disputed. If the Parties are unable to resolve a billing dispute, the Parties shall utilize the dispute resolution processes in this Agreement.
16.8 Counterparts and Electronic Signatures. This Agreement may be executed in counterparts. This Agreement shall become operative as soon as one counterpart hereof has been executed by each Party. The counterparts so executed shall constitute one Agreement notwithstanding that the signatures of all Parties do not appear on the same page. A faxed, .pdf, or other electronic copy of the fully executed original version of this Agreement shall have the same legal effect as an executed original for all purposes. Electronic signatures (including but not limited to signatures via DocuSign) shall be acceptable, enforceable, and shall have the same legal effect as an original signature.
16.9 Transparency. Upon request, the City shall promptly provide each Participating Agency with access to all records and information reflecting Flow and Strength of sewage in the Metro System, including, but not limited to, Flow data from all Metro System meters, worksheets or calculations that are used by City to develop cost information for any costs contemplated by this Agreement, and any Strength or other data utilized by the City when calculating annual sewage Flow and/or other costs imposed pursuant to this Agreement (including, but not limited to, pretreatment costs). The Parties shall work in good faith together to ensure the Participating Agencies have reasonable and full transparency under this Agreement.
16.10 Incorporation of Recitals. All of the recitals set forth in this Agreement, and all of the exhibits attached to this Agreement, are by this reference incorporated in and made a part of this Agreement as though fully set forth herein.
16.11 Joint Exercise of Power. It is the intent of the Parties that this Agreement is intended to exercise the governmental authority granted pursuant to Gov. Code Section 6500 et seq. which provides for the joint exercise of governmental powers.
IN WITNESS WHEREOF, the Parties have executed this Second Amendment and Restated Regional Wastewater Disposal Agreement and the associated Administrative Agreements(s) identified herein as of the date first set forth above.
CITY OF CHULA VISTA
Name:
Title:
Approved as to Form:
Name:
Title:
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CITY OF CORONADO
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF DEL MAR
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF EL CAJON
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF IMPERIAL BEACH
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF LA MESA
Name:
Title:
Approved as to Form:
Name:
Title:
LEMON GROVE SANITATION DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF NATIONAL CITY
Name:
Title:
Approved as to Form:
Name:
Title:
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OTAY WATER DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
PADRE DAM MUNICIPAL WATER
DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF POWAY
Name:
Title:
Approved as to Form:
Name:
Title:
CITY OF SAN DIEGO
Name:
Title:
Approved as to Form:
Name:
Title:
SAN DIEGO COUNTY SANITATION
DISTRICT
Name:
Title:
Approved as to Form:
Name:
Title:
ATTACHMENT B 174 July 7, 2026 Item 4
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EXHIBIT A
Metro Facilities (Electronic Exhibit); file name: 2025-10_Exhibit A Metro Facilities.aprx; time stamp of file: 10/23/2025 3:38 PM, software used to open and view file including version: ArcGIS Pro 3.5.0; included herewith as CD-ROM/DVD-ROM ATTACHMENT B 175 July 7, 2026 Item 4
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EXHIBIT B
DISTRIBUTION OF WASTEWATER SYSTEM CAPACITY RIGHTS
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EXHIBIT C
ADMINISTRATIVE PROTOCOL ON ALLOCATION OF OPERATING RESERVES
AND DEBT SERVICE COVERAGE TO PARTICIPATING AGENCIES
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EXHIBIT D
NOTICE LISTING
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EXHIBIT E
METHODOLOGY FOR CONTRACT CAPACITY TRANSFERS
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EXHIBIT F
METRO SYSTEM FLOW FORMULAS AND SAMPLING LOCATIONS
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EXHIBIT G
SAMPLE OF INTEREST CALCULATION
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EXHIBIT H
SUMMARY OF BILLINGS FROM COUNTY WATER AUTHORITY SHOWING COSTS
FOR UNTREATED WATER
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EXHIBIT I
LIST OF ADMINISTRATIVE AGREEMENTS
NO. TITLE EFFECTIVE
DATE
AMENDMEN
T DATE
1. Agreement Between City of San Diego and
Participating Agencies in the Metropolitan Sewerage
System for Unified Management of Industrial Waste
Discharge Pretreatment and Enhanced Source
Control Programs
2. Formatted: Title
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EXHIBIT J
SAMPLE FAB CALCULATION
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EXHIBIT JK
EXHIBIT LIST
Exhibit Name Amended Date
A
Metro Facilities (Electronic Exhibit); file name: 2025-10_Exhibit A Metro Facilities.aprx; time stamp of file: 10/23/2025 3:38 PM, software used to open and view file including version: ArcGIS Pro 3.5.0; included herewith as CD-ROM/DVD-ROM
B Distribution of Wastewater System Capacity Rights
C Administrative Protocol on Allocation of Operating Reserves and Debt Service Coverage to Participating Agencies
D Notice Listing
E Methodology for Contract Capacity Transfers
F Metro System Flow Formulas and Sampling Locations
G Sample of Interest Calculation
H Summary of Billings from County Water Authority Showing Costs for Untreated Water
I List of Administrative Agreements
J Sample FAB Calculation
JK Exhibit List
ATTACHMENT B 185 July 7, 2026 Item 4
City of Del Mar
Agenda Report
________________________________________________________________________________________________________ City Council Action:
TO: Honorable Mayor and City Councilmembers
FROM: Nestor Machado, Associate Management Analyst
Karen Brindley, Planning and Community Development Director Via Ashley Jones, City Manager
DATE: July 7, 2026
SUBJECT: Approval of Encroachment Permit 25-049 – Request to Install Grasscrete Hardscape Material and Other Public Improvements within the Public Rightof-Way at 1612 Stratford Way; Applicant: Paul Rael REQUESTED ACTION/RECOMMENDATION:
Staff recommends that the City Council adopt a Resolution (Attachment A) memorializing prior Council action to approve a Long-term Major Encroachment Permit (EP) 25-049 to install the following encroachments within the public right-of-way at 1612 Stratford Way:
Replace decomposed granite (“DG”) with grasscrete hardscape material; Install a mountable concrete curb between the roadway and the grasscrete material;
Install a six-inch concrete curb adjacent to the property fence line; Relocate walkway pavers;
BACKGROUND:
The Applicant filed an appeal after the denial of EP25-049, after staff determined that the proposed encroachments were inconsistent with Del Mar Municipal Code (DMMC) Section 23.28.040(B)(3), which prohibits encroachments that create the impression that public right-of-way is reserved for private use (see also, Council Policy (“CP”) 110). On May 5, 2026, the City Council held a de novo hearing to consider the Applicant’s appeal, which included replacing a section of right-of-way that the Applicant had improved with DG with grasscrete, and other associated encroachments, on the north side of the property located at 1612 Stratford Way, as shown on proposed plans dated March 29, 2026.
As presented at the do novo hearing, staff could not make Findings 2 and 5 of DMMC
23.28.070(C)(1)-(6), related to interference with the intended use of City right-of-way and potential detriment to the interests of the general public. Staff determined that the proposed encroachments would modify the existing DG shoulder in a manner that could 1 July 7, 2026 Item 5
City Council Agenda Report
EP25-049 (1612 Stratford Way)
July 7, 2026