Modesto City Council
August 22, 2023











 

!!!!!"#$"!%&'(!!)*+,-./*0! !!!!!)1+2130!45*6,/7*8/0! !!!!!98.78:61!;.865,1/<<<<<<<<<<<=!>&<?@!!!!!!!!!!!!>A<BC DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD !EF"4@>@@D@@G!@?H@AH&@AB !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ ;$)$K9!)"4LKH;LK;#$9$!IMKM4N$#<<<=!>&<AG!!!!!!!!!!!!&><&? DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD !EFO)@@>CD@@A!@?H@AH&@&& 4"K!I#"K;M4;L!;LOK9P !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ EFO)Q$#!RE78:S1+0!!! 451*:T,551+0!#1T+,J1+*5,.6!!! I,551+U<<<<<<<<<<<<<<<<<<<<<<<<<<=!C&<@@!!!!!!!!!!!!%C<AC DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD !EFO)@@>CD@@G!@?H@AH&@&& 4"K!I#"K;M4;L!;LOK9P !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ F*63/2*-1HM++,J*5,.6!I,551+!!! RO631+J+.863HO5,7,5V!I,551+U<<<<<=!B'<?@!!!!!!!!!!!!>><AG DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD !EFO)@@B&D@@A!@AH@AH&@&> )LK9$#$P!"KW!4"K9"!;#OX!;LOK9M$4 !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ EFO)Q$#!Y!49$")IM99$#<<<<<<<<<<<<=!G@<@@!!!!!!!!!!!!>'<>G DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD !EFO)@AG'D@@A!@?H@AH&@&& ;LK9#"!;L49"!;LOK9P !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ E78:S1+!*63!/51*:T,551+!! !!!!!RAU!#1T+,J1+*5,.6<<<<<<<<<<<=!GB<'>!!!!!!!!!!!!%A<@% !!!!!R&U!"77!.5Z1+![.+\<<<<<<<<<<=!B&<A&!!!!!!!!!!!!%G<&% DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD !EFO)@&%BD@@A!@AH@AH&@&> I#$4KL0!]MK^4!Y!)"W$#"!;LOK9M$4 !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ EFO)Q$#!Y!49$")IM99$#<<<<<<<<<<<<=!%B<'G!!!!!!!!!!!!>C<G' DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD _!EFO)@&%BD@@%!@AH@AH&@A? I#$4KL0!)$#;$W!Y!4"K!`L"aOMK!;LOKM$4 !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!#*51/!!!!!!!!!!I+,6J1/ EFO)Q$#!REME$!9#"W$4)"KU<<<<<<<<<=!A><@@!__!!!!!!!!!A@<?% EME$!9#"W$4)"K!4;LE$!LI!bL#]( !!M6/5*77*5,.6!.T!2.++8J*513!:15*7!-,-,6J!T.+!3+*,6*J10!*/![177 !!*/!,6/5*77*5,.6!.T!2.++8J*513!:15*7!-,-,6J!T.+!287c1+5/!,6 !!2.66125,.6![,5Z!/5.+:!/1[1+/!*63!3+*,6/d!^+.85,6J0!3+V !!-*2\,6J!*63!3,*-1+,6J!.T!e.,65/0!Z.71/!.+!2Z*/1/!,62783,6J #10..
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` !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!T#,)-!!!!!!!!!!F*%&')- G&4)*'*(8&4!G,%9%,2!a(*6)*!! !!!!!O@#&4-;#")!F%,,)*WWWWWWWWWWWX!JLWLL!!!!!!!!!!!!MNWYY EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE !A@GHIJbJEIIM!INOIMOLILM CPS!ZQSU0:!PS=!CPS0P!D@PTP!D:GS0UQC !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!T#,)-!!!!!!!!!!F*%&')- A@GHZQTOAUAQFU00QTWWWWWWWWWWWWWWWX!cdWNc!!!!!!!!!!!!KcWcJ EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE !A@GHIKKLEIIM!IMOIMOLILJ DP@P[QTPC.!HPTUA:CP.!HQTDQ=.!CPS!]:P^GUS.!C0PSUC@PGC!R!0G:@GHSQ D:GS0UQC !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!T#,)-!!!!!!!!!!F*%&')- A@GHZQT!R!C0QPHFU00QTWWWWWWWWWWWWX!YIWNY!!!!!!!!!!!!JYWMK EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE !A@GHIKcNEIIM!INOIMOLILM CPS!HP0Q:!D:GS0V !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!T#,)-!!!!!!!!!!F*%&')- #10..
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`<1Q&,,"&Ia///01M3/47111111111111<5/6< 8888888888888888888888888888888888888888888888888888888888888888 1-;FC5L638554154(54(<5<3 CYCE=DC?1F:>H9C1F:-HC?1-C>1;9C>FA-F:?1-C>1ECH=:1C>D1-C>HC1FYC9C F:G>HA=-N 11111111111111111111111111111111119.,&I1111111111;')JK&I -!9A>@Y=91;AHH=91`;A9=a//////////012</MX11111111111137/XM 8888888888888888888888888888888888888888888888888888888888888888 1-;FC577X854415L(54(<5<3 #10..
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Exhibit 12-G
Required Federal-Aid Contract Language
Local Assistance Procedures Manual

May 2023
FHWA-1273 -- Revised July 5, 2022

REQUIRED CONTRACT

PROVISIONS FEDERAL-AID

CONSTRUCTION CONTRACTS

EXHIBIT B
#10..
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Local Assistance Procedures Manual Exhibit 12-G
Required Federal-Aid Contract Language

May 2023
I. General
II. Nondiscrimination
III. Non-segregated Facilities
IV. Davis-Bacon and Related Act Provisions
V. Contract Work Hours and Safety Standards Act Provisions VI. Subletting or Assigning the Contract
VII. Safety: Accident Prevention
VIII. False Statements Concerning Highway Projects
IX. Implementation of Clean Air Act and Federal Water
Pollution Control Act
X. Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion
XI. Certification Regarding Use of Contract Funds for Lobbying XII. Use of United States-Flag Vessels:

ATTACHMENTS
A. Employment and Materials Preference for Appalachian
Development Highway System or Appalachian Local Access
Road Contracts (included in Appalachian contracts only) I. GENERAL

1. Form FHWA-1273 must be physically incorporated in each construction contract funded under title 23, United States Code, as required in 23 CFR 633.102(b) (excluding emergency
contracts solely intended for debris removal). The contractor (or subcontractor) must insert this form in each subcontract and further require its inclusion in all lower tier subcontracts (excluding purchase orders, rental agreements and other agreements for supplies or services). 23 CFR633.102(e).

The applicable requirements of Form FHWA-1273 are
incorporated by reference for work done under any purchase order, rental agreement or agreement for other services. The prime contractor shall be responsible for compliance by any subcontractor, lower-tier subcontractor or service provider. 23 CFR 633.102(e).

Form FHWA-1273 must be included in all Federal-aid designbuild contracts, in all subcontracts and in lower tier subcontracts (excluding subcontracts for design services, purchase orders, rental agreements and other agreements for supplies or
services) in accordance with 23 CFR 633.102. The designbuilder shall be responsible for compliance by any subcontractor, lower-tier subcontractor or service provider.

Contracting agencies may reference Form FHWA-1273 in
solicitation-for-bids or request-for-proposals documents, however, the Form FHWA-1273 must be physically incorporated (not referenced) in all contracts, subcontracts and lower-tier subcontracts (excluding purchase orders, rental agreements and other agreements for supplies or services related to a
construction contract). 23 CFR 633.102(b).

2. Subject to the applicability criteria noted in the following sections, these contract provisions shall apply to all work performed on the contract by the contractor's own organization and with the assistance of workers under the contractor's immediate superintendence and to all work performed on the contract by piecework, station work, or by subcontract. 23 CFR 633.102(d).

3. A breach of any of the stipulations contained in these Required Contract Provisions may be sufficient grounds for withholding of progress payments, withholding of final payment, termination of the contract, suspension / debarment or any other action determined to be appropriate by the contracting agency and FHWA.

4. Selection of Labor: During the performance of this contract, the contractor shall not use convict labor for any purpose within the limits of a construction project on a Federal-aid highway unless it is labor performed by convicts who are on parole, supervised release, or probation. 23 U.S.C. 114(b).The term Federal-aid highway does not include roadways functionally classified as local roads or rural minor collectors. 23 U.S.C. 101(a).

II. NONDISCRIMINATION (23 CFR 230.107(a); 23 CFR Part
230, Subpart A, Appendix A; EO 11246)
The provisions of this section related to 23 CFR Part 230, Subpart A, Appendix A are applicable to all Federal-aid construction contracts and to all related construction
subcontracts of $10,000 or more. The provisions of 23 CFR Part 230 are not applicable to material supply, engineering, or architectural service contracts.

In addition, the contractor and all subcontractors must comply with the following policies: Executive Order 11246, 41 CFR Part 60, 29 CFR Parts 1625-1627, 23 U.S.C. 140, Section 504 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794), Title VI of the Civil Rights Act of 1964, as amended (42 U.S.C. 2000d et seq.), and related regulations including 49 CFR Parts 21, 26, and 27; and 23 CFR Parts 200, 230, and 633.

The contractor and all subcontractors must comply with: the requirements of the Equal Opportunity Clause in 41 CFR 60-

1.4(b) and, for all construction contracts exceeding $10,000, the Standard Federal Equal Employment Opportunity Construction Contract Specifications in 41 CFR 60-4.3.

Note: The U.S. Department of Labor has exclusive authority to determine compliance with Executive Order 11246 and the policies of the Secretary of Labor including 41 CFR Part 60, and 29 CFR Parts 1625-1627. The contracting agency and the
FHWA have the authority and the responsibility to ensure compliance with 23 U.S.C. 140, Section 504 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794), and Title VI of the Civil Rights Act of 1964, as amended (42 U.S.C. 2000d et seq.), and related regulations including 49 CFR Parts 21, 26, and 27; and 23 CFR Parts 200, 230, and 633.

The following provision is adopted from 23 CFR Part 230, Subpart A, Appendix A, with appropriate revisions to conform to the U.S. Department of Labor (US DOL) and FHWA
requirements.
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1. Equal Employment Opportunity: Equal Employment
Opportunity (EEO) requirements not to discriminate and to take affirmative action to assure equal opportunity as set forth under laws, executive orders, rules, regulations (see 28 CFR Part 35, 29 CFR Part 1630, 29 CFR Parts 1625-1627, 41 CFR Part 60 and 49 CFR Part 27) and orders of the Secretary of Labor as modified by the provisions prescribed herein, and imposed pursuant to 23 U.S.C. 140, shall constitute the EEO and specific affirmative action standards for the contractor's project activities under this contract.

The provisions of the Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.) set forth under 28 CFR Part 35 and 29 CFR Part 1630 are incorporated by reference in this contract. In the execution of this contract, the contractor agrees to comply with the following minimum specific requirement activities of EEO:
a. The contractor will work with the contracting agency and the Federal Government to ensure that it has made every good faith effort to provide equal opportunity with respect to all of its terms and conditions of employment and in their review of activities under the contract. 23 CFR 230.409 (g)(4) & (5).
b. The contractor will accept as its operating policy the following statement:
"It is the policy of this Company to assure that applicants are employed, and that employees are treated during employment, without regard to their race, religion, sex, sexual orientation, gender identity, color, national origin, age or disability. Such action shall include: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship, preapprenticeship, and/or on-the-job training."

2. EEO Officer: The contractor will designate and make known to the contracting officers an EEO Officer who will have the responsibility for and must be capable of effectively administering and promoting an active EEO program and who must be assigned adequate authority and responsibility to do so.

3. Dissemination of Policy: All members of the contractor's staff who are authorized to hire, supervise, promote, and discharge employees, or who recommend such action or are substantially involved in such action, will be made fully cognizant of and will implement the contractor's EEO policy and contractual
responsibilities to provide EEO in each grade and classification of employment. To ensure that the above agreement will be met, the following actions will be taken as a minimum:
a. Periodic meetings of supervisory and personnel office employees will be conducted before the start of work and then not less often than once every six months, at which time the contractor's EEO policy and its implementation will be reviewed and explained.

The meetings will be conducted by the EEO Officer or other knowledgeable company official.
b. All new supervisory or personnel office employees will be given a thorough indoctrination by the EEO Officer, covering all major aspects of the contractor's EEO obligations within thirty days following their reporting for duty with the contractor. c. All personnel who are engaged in direct recruitment for the project will be instructed by the EEO Officer in the contractor's procedures for locating and hiring minorities and women. d. Notices and posters setting forth the contractor's EEO policy will be placed in areas readily accessible to employees, applicants for employment and potential employees.
e. The contractor's EEO policy and the procedures to implement such policy will be brought to the attention of employees by means of meetings, employee handbooks, or other appropriate means.

4. Recruitment: When advertising for employees, the contractor will include in all advertisements for employees the notation: "An Equal Opportunity Employer." All such advertisements will be placed in publications having a large circulation among minorities and women in the area from which the project work force would normally be derived.
a. The contractor will, unless precluded by a valid bargaining agreement, conduct systematic and direct recruitment through public and private employee referral sources likely to yield qualified minorities and women. To meet this requirement, the contractor will identify sources of potential minority group employees and establish with such identified sources procedures whereby minority and women applicants may be referred to the contractor for employment consideration.
b. In the event the contractor has a valid bargaining agreement providing for exclusive hiring hall referrals, the contractor is expected to observe the provisions of that agreement to the extent that the system meets the contractor's compliance with EEO contract provisions. Where implementation of such an agreement has the effect of discriminating against minorities or women, or obligates the contractor to do the same, such implementation violates Federal nondiscrimination provisions.
c. The contractor will encourage its present employees to refer minorities and women as applicants for employment. Information and procedures with regard to referring such applicants will be discussed with employees.

5. Personnel Actions: Wages, working conditions, and employee benefits shall be established and administered, and personnel actions of every type, including hiring, upgrading, promotion, transfer, demotion, layoff, and termination, shall be taken without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, age or disability. The following procedures shall be followed:
a. The contractor will conduct periodic inspections of project sites to ensure that working conditions and employee facilities do not indicate discriminatory treatment of project site personnel. b. The contractor will periodically evaluate the spread of wages paid within each classification to determine any evidence of discriminatory wage practices.
c. The contractor will periodically review selected personnel actions in depth to determine whether there is evidence of discrimination.

Where evidence is found, the contractor will promptly take corrective action. If the review indicates that the discrimination may extend beyond the actions reviewed, such corrective action shall include all affected persons.
d. The contractor will promptly investigate all complaints of alleged discrimination made to the contractor in connection with its obligations under this contract, will attempt to resolve such complaints, and will take appropriate corrective action within a reasonable time. If the investigation indicates that the discrimination may affect persons other than the complainant, such corrective action shall include such other persons. Upon completion of each investigation, the contractor will inform every complainant of all of their avenues of appeal.
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6. Training and Promotion:
a. The contractor will assist in locating, qualifying, and increasing the skills of minorities and women who are applicants for employment or current employees. Such efforts should be aimed at developing full journey level status employees in the type of trade or job classification involved.
b. Consistent with the contractor's work force requirements and as permissible under Federal and State regulations, the contractor shall make full use of training programs (i.e., apprenticeship and on-thejob training programs for the geographical area of contract performance). In the event a special provision for training is provided under this contract, this subparagraph will be superseded as indicated in the special provision. The contracting agency may reserve training positions for persons who receive welfare assistance in accordance with 23 U.S.C. 140(a).
c. The contractor will advise employees and applicants for employment of available training programs and entrance
requirements for each.
d. The contractor will periodically review the training and promotion potential of employees who are minorities and women and will encourage eligible employees to apply for such training and promotion.

7. Unions: If the contractor relies in whole or in part upon unions as a source of employees, the contractor will use good faith efforts to obtain the cooperation of such unions to increase opportunities for minorities and women. 23 CFR 230.409. Actions by the contractor, either directly or through a contractor's association acting as agent, will include the procedures set forth below:
a. The contractor will use good faith efforts to develop, in cooperation with the unions, joint training programs aimed toward qualifying more minorities and women for membership in the unions and increasing the skills of minorities and women so that they may qualify for higher paying employment.
b. The contractor will use good faith efforts to incorporate an EEO clause into each union agreement to the end that such union will be contractually bound to refer applicants without regard to their race, color, religion, sex, sexual orientation, gender identity, national origin, age, or disability.
c. The contractor is to obtain information as to the referral practices and policies of the labor union except that to the extent such information is within the exclusive possession of the labor union and such labor union refuses to furnish such information to the contractor, the contractor shall so certify to the contracting agency and shall set forth what efforts have been made to obtain such information.
d. In the event the union is unable to provide the contractor with a reasonable flow of referrals within the time limit set forth in the collective bargaining agreement, the contractor will, through independent recruitment efforts, fill the employment vacancies without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, age, or disability; making full efforts to obtain qualified and/or qualifiable minorities and women. The failure of a union to provide sufficient referrals (even though it is obligated to provide exclusive referrals under the terms of a collective bargaining agreement) does not relieve the contractor from the requirements of this paragraph. In the event the union referral practice prevents the contractor from meeting the obligations pursuant to Executive Order 11246, as amended, and these special provisions, such contractor shall immediately notify the contracting agency.

8. Reasonable Accommodation for Applicants / Employees with Disabilities: The contractor must be familiar with the requirements for and comply with the Americans with Disabilities Act and all rules and regulations established thereunder. Employers must provide reasonable accommodation in all employment activities unless to do so would cause an undue hardship.

9. Selection of Subcontractors, Procurement of Materials and Leasing of Equipment: The contractor shall not discriminate on the grounds of race, color, religion, sex, sexual orientation, gender identity, national origin, age, or disability in the selection and retention of subcontractors, including procurement of materials and leases of equipment. The contractor shall take all necessary and reasonable steps to ensure nondiscrimination in the administration of this contract. a. The contractor shall notify all potential subcontractors, suppliers, and lessors of their EEO obligations under this contract.
b. The contractor will use good faith efforts to ensure subcontractor compliance with their EEO obligations.

10. Assurance Required:
a. The requirements of 49 CFR Part 26 and the State DOT’s FHWA-approved Disadvantaged Business Enterprise (DBE) program are incorporated by reference.
b. The contractor, subrecipient or subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the performance of this contract. The contractor shall carry out applicable requirements of 49 CFR part 26 in the award and administration of DOT-assisted contracts. Failure by the contractor to carry out these requirements is a material breach of this contract, which may result in the termination of this contract or such other remedy as the recipient deems appropriate, which may include, but is not limited to:
(1) Withholding monthly progress payments;
(2) Assessing sanctions;
(3) Liquidated damages; and/or
(4) Disqualifying the contractor from future bidding as nonresponsible. c. The Title VI and nondiscrimination provisions of U.S. DOT Order 1050.2A at Appendixes A and E are incorporated by reference. 49 CFR Part 21.

11. Records and Reports: The contractor shall keep such records as necessary to document compliance with the EEO requirements.

Such records shall be retained for a period of three years following the date of the final payment to the contractor for all contract work and shall be available at reasonable times and places for inspection by authorized representatives of the contracting agency and the FHWA.
a. The records kept by the contractor shall document the following:
(1) The number and work hours of minority and non-minority group members and women employed in each work
classification on the project;
(2) The progress and efforts being made in cooperation with unions, when applicable, to increase employment opportunities for minorities and women; and
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b. The contractors and subcontractors will submit an annual report to the contracting agency each July for the duration of the project indicating the number of minority, women, and non-minority group employees currently engaged in each work classification required by the contract work. This information is to be reported on Form FHWA-1391. The staffing data should represent the project work force on board in all or any part of the last payroll period preceding the end of July. If on-the-job training is being required by special provision, the contractor will be required to collect and report training data. The employment data should reflect the work force on board during all or any part of the last payroll period preceding the end of July.

III. NONSEGREGATED FACILITIES
This provision is applicable to all Federal-aid construction contracts and to all related construction subcontracts of more than $10,000. 41 CFR 60-1.5.

As prescribed by 41 CFR 60-1.8, the contractor must ensure that facilities provided for employees are provided in such a manner that segregation on the basis of race, color, religion, sex, sexual orientation, gender identity, or national origin cannot result. The contractor may neither require such segregated use by written or oral policies nor tolerate such use by employee custom. The contractor's obligation extends further to ensure that its employees are not assigned to perform their services at any location under the contractor's control where the facilities are segregated. The term "facilities" includes waiting rooms, work areas, restaurants and other eating areas, time clocks, restrooms, washrooms, locker rooms and other storage or dressing areas, parking lots, drinking fountains, recreation or entertainment areas, transportation, and housing provided for employees. The contractor shall provide separate or single-user restrooms and necessary dressing or sleeping areas to assure privacy between sexes.

IV. DAVIS-BACON AND RELATED ACT PROVISIONS
This section is applicable to all Federal-aid construction projects exceeding $2,000 and to all related subcontracts and lower-tier subcontracts (regardless of subcontract size), in accordance with 29 CFR 5.5. The requirements apply to all projects located within the right-of-way of a roadway that is functionally classified as Federalaid highway. 23 U.S.C. 113. This excludes roadways functionally classified as local roads or rural minor collectors, which are exempt. 23 U.S.C. 101. Where applicable law requires that projects be treated as a project on a Federal-aid highway, the provisions of this subpart will apply regardless of the location of the project. Examples include: Surface Transportation Block Grant Program projects funded under 23 U.S.C. 133 [excluding recreational trails projects], the Nationally Significant Freight and Highway Projects funded under 23 U.S.C. 117, and National Highway Freight Program projects funded under 23 U.S.C. 167.

The following provisions are from the U.S. Department of Labor regulations in 29 CFR 5.5 “Contract provisions and related matters” with minor revisions to conform to the FHWA-1273 format and FHWA program requirements.

1. Minimum wages (29 CFR 5.5)
a. All laborers and mechanics employed or working upon the site of the work, will be paid unconditionally and not less often than once a week, and without subsequent deduction or rebate on any account (except such payroll deductions as are permitted by regulations issued by the Secretary of Labor under the Copeland Act (29 CFR part 3)), the full amount of wages and bona fide fringe benefits (or cash equivalents thereof) due at time of payment computed at rates not less than those contained in the wage determination of the Secretary of Labor which is attached hereto and made a part hereof, regardless of any contractual relationship which may be alleged to exist between the contractor and such laborers and mechanics.

Contributions made or costs reasonably anticipated for bona fide fringe benefits under section 1(b)(2) of the Davis-Bacon Act on behalf of laborers or mechanics are considered wages paid to such laborers or mechanics, subject to the provisions of paragraph 1.d. of this section; also, regular contributions made or costs incurred for more than a weekly period (but not less often than quarterly) under plans, funds, or programs which cover the particular weekly period, are deemed to be constructively made or incurred during such weekly period. Such laborers and mechanics shall be paid the appropriate wage rate and fringe benefits on the wage determination for the classification of work actually performed, without regard to skill, except as provided in 29 CFR 5.5(a)(4). Laborers or mechanics performing work in more than one classification may be
compensated at the rate specified for each classification for the time actually worked therein: Provided, That the employer's payroll records accurately set forth the time spent in each classification in which work is performed. The wage determination (including any additional classification and wage rates conformed under paragraph

1.b. of this section) and the Davis-Bacon poster (WH–1321) shall be posted at all times by the contractor and its subcontractors at the site of the work in a prominent and accessible place where it can be easily seen by the workers.
b. (1) The contracting officer shall require that any class of laborers or mechanics, including helpers, which is not listed in the wage determination and which is to be employed under the contract shall be classified in conformance with the wage determination. The contracting officer shall approve an additional classification and wage rate and fringe benefits therefore only when the following criteria have been met:
(i) The work to be performed by the classification requested is not performed by a classification in the wage determination; and
(ii) The classification is utilized in the area by the construction industry; and
(iii) The proposed wage rate, including any bona fide fringe benefits, bears a reasonable relationship to the wage rates contained in the wage determination.
(2) If the contractor and the laborers and mechanics to be employed in the classification (if known), or their
representatives, and the contracting officer agree on the classification and wage rate (including the amount designated for fringe benefits where appropriate), a report of the action taken shall be sent by the contracting officer to the Administrator of the Wage and Hour Division, U.S. Department of Labor, Washington, DC 20210. The Administrator, or an authorized representative, will approve, modify, or disapprove every additional classification action within 30 days of receipt and so advise the contracting officer or will notify the contracting officer within the 30-day period that additional time is necessary. #10..
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(3) In the event the contractor, the laborers or mechanics to be employed in the classification or their representatives, and the contracting officer do not agree on the proposed classification and wage rate (including the amount
designated for fringe benefits, where appropriate), the contracting officer shall refer the questions, including the views of all interested parties and the recommendation of the contracting officer, to the Administrator for determination.

The Administrator, or an authorized representative, will issue a determination within 30 days of receipt and so advise the contracting officer or will notify the contracting officer within the 30-day period that additional time is necessary.
(4) The wage rate (including fringe benefits where
appropriate) determined pursuant to paragraphs 1.b.(2) or

1.b.(3) of this section, shall be paid to all workers performing work in the classification under this contract from the first day on which work is performed in the classification.
c. Whenever the minimum wage rate prescribed in the contract for a class of laborers or mechanics includes a fringe benefit which is not expressed as an hourly rate, the contractor shall either pay the benefit as stated in the wage determination or shall pay another bona fide fringe benefit or an hourly cash equivalent thereof. d. If the contractor does not make payments to a trustee or other third person, the contractor may consider as part of the wages of any laborer or mechanic the amount of any costs reasonably anticipated in providing bona fide fringe benefits under a plan or program, Provided, That the Secretary of Labor has found, upon the written request of the contractor, that the applicable standards of the Davis-Bacon Act have been met. The Secretary of Labor may require the contractor to set aside in a separate account assets for the meeting of obligations under the plan or program.

2. Withholding (29 CFR 5.5)
The contracting agency shall upon its own action or upon written request of an authorized representative of the Department of Labor, withhold or cause to be withheld from the contractor under this contract, or any other Federal contract with the same prime contractor, or any other federally-assisted contract subject to DavisBacon prevailing wage requirements, which is held by the same prime contractor, so much of the accrued payments or advances as may be considered necessary to pay laborers and mechanics, including apprentices, trainees, and helpers, employed by the contractor or any subcontractor the full amount of wages required by the contract. In the event of failure to pay any laborer or mechanic, including any apprentice, trainee, or helper, employed or working on the site of the work, all or part of the wages required by the contract, the contracting agency may, after written notice to the contractor, take such action as may be necessary to cause the suspension of any further payment, advance, or guarantee of funds until such violations have ceased.

3. Payrolls and basic records (29 CFR 5.5)
a. Payrolls and basic records relating thereto shall be maintained by the contractor during the course of the work and preserved for a period of three years thereafter for all laborers and mechanics working at the site of the work. Such records shall contain the name, address, and social security number of each such worker, his or her correct classification, hourly rates of wages paid (including rates of contributions or costs anticipated for bona fide fringe benefits or cash equivalents thereof of the types described in section 1(b)(2)(B) of the Davis-Bacon Act), daily and weekly number of hours worked, deductions made and actual wages paid. Whenever the Secretary of Labor has found under 29 CFR 5.5(a)(1)(iv) that the wages of any laborer or mechanic include the amount of any costs reasonably anticipated in providing benefits under a plan or program described in section 1(b)(2)(B) of the Davis-Bacon Act, the contractor shall maintain records which show that the commitment to provide such benefits is enforceable, that the plan or program is financially responsible, and that the plan or program has been communicated in writing to the laborers or mechanics affected, and records which show the costs anticipated or the actual cost incurred in providing such benefits. Contractors employing apprentices or trainees under approved programs shall maintain written evidence of the registration of apprenticeship programs and certification of trainee programs, the registration of the apprentices and trainees, and the ratios and wage rates prescribed in the applicable programs.
b. (1) The contractor shall submit weekly for each week in which any contract work is performed a copy of all payrolls to the contracting agency. The payrolls submitted shall set out accurately and completely all of the information required to be maintained under 29 CFR 5.5(a)(3)(i), except that full social security numbers and home addresses shall not be included on weekly transmittals. Instead the payrolls shall only need to include an individually identifying number for each employee (e.g., the last four digits of the employee's social security number). The required weekly payroll information may be submitted in any form desired. Optional Form WH–347 is
available for this purpose from the Wage and Hour Division Web site. The prime contractor is responsible for the submission of copies of payrolls by all subcontractors. Contractors and subcontractors shall maintain the full social security number and current address of each covered worker, and shall provide them upon request to the contracting agency for transmission to the State DOT, the FHWA or the Wage and Hour Division of the Department of Labor for purposes of an investigation or audit of compliance with prevailing wage requirements. It is not a violation of this section for a prime contractor to require a subcontractor to provide addresses and social security numbers to the prime contractor for its own records, without weekly submission to the contracting agency.
(2) Each payroll submitted shall be accompanied by a
“Statement of Compliance,” signed by the contractor or
subcontractor or his or her agent who pays or supervises the payment of the persons employed under the contract and shall certify the following:
(i) That the payroll for the payroll period contains the information required to be provided under 29 CFR

5.5(a)(3)(ii), the appropriate information is being maintained under 29 CFR 5.5(a)(3)(i), and that such information is correct and complete;
(ii) That each laborer or mechanic (including each helper, apprentice, and trainee) employed on the contract during the payroll period has been paid the full weekly wages earned, without rebate, either directly or indirectly, and that no deductions have been made either directly or indirectly from the full wages earned, other than permissible deductions as set forth in 29 CFR part 3;
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(iii) That each laborer or mechanic has been paid not less than the applicable wage rates and fringe benefits or cash equivalents for the classification of work performed, as specified in the applicable wage determination incorporated into the contract.
(3) The weekly submission of a properly executed certification set forth on the reverse side of Optional Form WH–347 shall satisfy the requirement for submission of the “Statement of Compliance” required by paragraph 3.b.(2) of this section. (4) The falsification of any of the above certifications may subject the contractor or subcontractor to civil or criminal prosecution under 18 U.S.C. 1001 and 31 U.S.C. 231.
c. The contractor or subcontractor shall make the records required under paragraph 3.a. of this section available for inspection, copying, or transcription by authorized representatives of the contracting agency, the State DOT, the FHWA, or the Department of Labor, and shall permit such representatives to interview employees during working hours on the job. If the contractor or subcontractor fails to submit the required records or to make them available, the FHWA may, after written notice to the contractor, the contracting agency or the State DOT, take such action as may be necessary to cause the suspension of any further payment, advance, or guarantee of funds. Furthermore, failure to submit the required records upon request or to make such records available may be grounds for debarment action pursuant to 29 CFR 5.12.

4. Apprentices and trainees (29 CFR 5.5)
a. Apprentices (programs of the USDOL).

Apprentices will be permitted to work at less than the predetermined rate for the work they performed when they are employed pursuant to and individually registered in a bona fide apprenticeship program registered with the U.S. Department of Labor, Employment and Training Administration, Office of Apprenticeship Training, Employer and Labor Services, or with a State Apprenticeship Agency recognized by the Office, or if a person is employed in his or her first 90 days of probationary employment as an apprentice in such an apprenticeship program, who is not individually registered in the program, but who has been certified by the Office of Apprenticeship Training, Employer and Labor Services or a State Apprenticeship Agency (where appropriate) to be eligible for probationary employment as an apprentice.

The allowable ratio of apprentices to journeymen on the job site in any craft classification shall not be greater than the ratio permitted to the contractor as to the entire work force under the registered program. Any worker listed on a payroll at an apprentice wage rate, who is not registered or otherwise employed as stated above, shall be paid not less than the applicable wage rate on the wage determination for the classification of work actually performed. In addition, any apprentice performing work on the job site in excess of the ratio permitted under the registered program shall be paid not less than the applicable wage rate on the wage determination for the work actually performed. Where a contractor is performing construction on a project in a locality other than that in which its program is registered, the ratios and wage rates (expressed in percentages of the journeyman's hourly rate) specified in the contractor's or subcontractor's registered program shall be observed.

Every apprentice must be paid at not less than the rate specified in the registered program for the apprentice's level of progress, expressed as a percentage of the journeymen hourly rate specified in the applicable wage determination. Apprentices shall be paid fringe benefits in accordance with the provisions of the apprenticeship program. If the apprenticeship program does not specify fringe benefits, apprentices must be paid the full amount of fringe benefits listed on the wage determination for the applicable classification. If the Administrator determines that a different practice prevails for the applicable apprentice classification, fringes shall be paid in accordance with that determination.

In the event the Office of Apprenticeship Training, Employer and Labor Services, or a State Apprenticeship Agency recognized by the Office, withdraws approval of an apprenticeship program, the contractor will no longer be permitted to utilize apprentices at less than the applicable predetermined rate for the work performed until an acceptable program is approved.
b. Trainees (programs of the USDOL).

Except as provided in 29 CFR 5.16, trainees will not be permitted to work at less than the predetermined rate for the work performed unless they are employed pursuant to and individually registered in a program which has received prior approval, evidenced by formal certification by the U.S. Department of Labor, Employment and Training Administration.

The ratio of trainees to journeymen on the job site shall not be greater than permitted under the plan approved by the Employment and Training Administration.

Every trainee must be paid at not less than the rate specified in the approved program for the trainee's level of progress, expressed as a percentage of the journeyman hourly rate specified in the applicable wage determination. Trainees shall be paid fringe benefits in accordance with the provisions of the trainee program. If the trainee program does not mention fringe benefits, trainees shall be paid the full amount of fringe benefits listed on the wage determination unless the Administrator of the Wage and Hour Division determines that there is an apprenticeship program associated with the
corresponding journeyman wage rate on the wage determination which provides for less than full fringe benefits for apprentices. Any employee listed on the payroll at a trainee rate who is not registered and participating in a training plan approved by the Employment and Training Administration shall be paid not less than the applicable wage rate on the wage determination for the classification of work actually performed. In addition, any trainee performing work on the job site in excess of the ratio permitted under the registered program shall be paid not less than the applicable wage rate on the wage determination for the work actually performed.

In the event the Employment and Training Administration withdraws approval of a training program, the contractor will no longer be permitted to utilize trainees at less than the applicable predetermined rate for the work performed until an acceptable program is approved. c. Equal employment opportunity. The utilization of apprentices, trainees and journeymen under this part shall be in conformity with the equal employment opportunity requirements of Executive Order 11246, as amended, and 29 CFR part 30.
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d. Apprentices and Trainees (programs of the U.S. DOT).

Apprentices and trainees working under apprenticeship and skill training programs which have been certified by the Secretary of Transportation as promoting EEO in connection with Federal-aid highway construction programs are not subject to the requirements of paragraph 4 of this Section IV. 23 CFR 230.111(e)(2). The straight time hourly wage rates for apprentices and trainees under such programs will be established by the particular programs. The ratio of apprentices and trainees to journeymen shall not be greater than permitted by the terms of the particular program.

5. Compliance with Copeland Act requirements. The contractor shall comply with the requirements of 29 CFR part 3, which are incorporated by reference in this contract as provided in 29 CFR 5.5.

6. Subcontracts. The contractor or subcontractor shall insert Form FHWA-1273 in any subcontracts and also require the
subcontractors to include Form FHWA-1273 in any lower tier subcontracts. The prime contractor shall be responsible for the compliance by any subcontractor or lower tier subcontractor with all the contract clauses in 29 CFR 5.5.

7. Contract termination: debarment. A breach of the contract clauses in 29 CFR 5.5 may be grounds for termination of the contract, and for debarment as a contractor and a subcontractor as provided in 29 CFR 5.12.

8. Compliance with Davis-Bacon and Related Act
requirements. All rulings and interpretations of the Davis-Bacon and Related Acts contained in 29 CFR parts 1, 3, and 5 are herein incorporated by reference in this contract as provided in 29 CFR 5.5.

9. Disputes concerning labor standards. As provided in 29 CFR

5.5, disputes arising out of the labor standards provisions of this contract shall not be subject to the general disputes clause of this contract. Such disputes shall be resolved in accordance with the procedures of the Department of Labor set forth in 29 CFR parts 5, 6, and 7. Disputes within the meaning of this clause include disputes between the contractor (or any of its subcontractors) and the contracting agency, the U.S. Department of Labor, or the employees or their representatives.

10. Certification of eligibility (29 CFR 5.5)
a. By entering into this contract, the contractor certifies that neither it (nor he or she) nor any person or firm who has an interest in the contractor's firm is a person or firm ineligible to be awarded Government contracts by virtue of section 3(a) of the Davis-Bacon Act or 29 CFR 5.12(a)(1).
b. No part of this contract shall be subcontracted to any person or firm ineligible for award of a Government contract by virtue of section 3(a) of the Davis-Bacon Act or 29 CFR 5.12(a)(1). c. The penalty for making false statements is prescribed in the U.S. Criminal Code, 18 U.S.C. 1001.

V. CONTRACT WORK HOURS AND SAFETY STANDARDS ACT
Pursuant to 29 CFR 5.5(b), the following clauses apply to any Federal-aid construction contract in an amount in excess of $100,000 and subject to the overtime provisions of the Contract Work Hours and Safety Standards Act. These clauses shall be inserted in addition to the clauses required by 29 CFR 5.5(a) or 29 CFR 4.6. As used in this paragraph, the terms laborers and mechanics include watchmen and guards.

1. Overtime requirements. No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic in any workweek in which he or she is employed on such work to work in excess of forty hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of forty hours in such workweek. 29 CFR 5.5.

2. Violation; liability for unpaid wages; liquidated damages. In the event of any violation of the clause set forth in paragraph 1 of this section, the contractor and any subcontractor responsible therefor shall be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the United States (in the case of work done under contract for the District of Columbia or a territory, to such District or to such territory), for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in paragraph 1 of this section, in the sum currently provided in 29 CFR 5.5(b)(2)* for each calendar day on which such individual was required or permitted to work in excess of the standard workweek of forty hours without payment of the overtime wages required by the clause set forth in paragraph 1 of this section. 29 CFR

5.5. * $27 as of January 23, 2019 (See 84 FR 213-01, 218) as may be adjusted annually by the Department of Labor; pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990).

3. Withholding for unpaid wages and liquidated damages. The FHWA or the contacting agency shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by the contractor or subcontractor under any such contract or any other Federal contract with the same prime contractor, or any other federally-assisted contract subject to the Contract Work Hours and Safety Standards Act, which is held by the same prime contractor, such sums as may be determined to be necessary to satisfy any liabilities of such contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in paragraph 2 of this section. 29 CFR 5.5.

4. Subcontracts. The contractor or subcontractor shall insert in any subcontracts the clauses set forth in paragraphs 1 through 4 of this section and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in paragraphs 1 through 4 of this section. 29 CFR 5.5.
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Local Assistance Procedures Manual Exhibit 12-G
Required Federal-Aid Contract Language

May 2023
VI. SUBLETTING OR ASSIGNING THE CONTRACT
This provision is applicable to all Federal-aid construction contracts on the National Highway System pursuant to 23 CFR 635.116.

1. The contractor shall perform with its own organization contract work amounting to not less than 30 percent (or a greater percentage if specified elsewhere in the contract) of the total original contract price, excluding any specialty items designated by the contracting agency. Specialty items may be performed by subcontract and the amount of any such specialty items performed may be deducted from the total original contract price before computing the amount of work required to be performed by the contractor's own organization (23 CFR 635.116).
a. The term “perform work with its own organization” in paragraph 1 of Section VI refers to workers employed or leased by the prime contractor, and equipment owned or rented by the prime contractor, with or without operators. Such term does not include employees or equipment of a subcontractor or lower tier subcontractor, agents of the prime contractor, or any other assignees. The term may include payments for the costs of hiring leased employees from an employee leasing firm meeting all relevant Federal and State regulatory requirements. Leased employees may only be included in this term if the prime contractor meets all of the following conditions:
(based on longstanding interpretation)
(1) the prime contractor maintains control over the supervision of the day-to-day activities of the leased employees;
(2) the prime contractor remains responsible for the quality of the work of the leased employees;
(3) the prime contractor retains all power to accept or exclude individual employees from work on the project; and
(4) the prime contractor remains ultimately responsible for the payment of predetermined minimum wages, the submission of payrolls, statements of compliance and all other Federal regulatory requirements.
b. "Specialty Items" shall be construed to be limited to work that requires highly specialized knowledge, abilities, or equipment not ordinarily available in the type of contracting organizations qualified and expected to bid or propose on the contract as a whole and in general are to be limited to minor components of the overall contract. 23 CFR 635.102.

2. Pursuant to 23 CFR 635.116(a), the contract amount upon which the requirements set forth in paragraph (1) of Section VI is computed includes the cost of material and manufactured products which are to be purchased or produced by the contractor under the contract provisions.

3. Pursuant to 23 CFR 635.116(c), the contractor shall furnish (a) a competent superintendent or supervisor who is employed by the firm, has full authority to direct performance of the work in accordance with the contract requirements, and is in charge of all construction operations (regardless of who performs the work) and (b) such other of its own organizational resources (supervision, management, and engineering services) as the contracting officer determines is necessary to assure the performance of the contract.

4. No portion of the contract shall be sublet, assigned or otherwise disposed of except with the written consent of the contracting officer, or authorized representative, and such consent when given shall not be construed to relieve the contractor of any responsibility for the fulfillment of the contract. Written consent will be given only after the contracting agency has assured that each subcontract is evidenced in writing and that it contains all pertinent provisions and requirements of the prime contract. (based on long-standing interpretation of 23 CFR 635.116).

5. The 30-percent self-performance requirement of paragraph (1) is not applicable to design-build contracts; however, contracting agencies may establish their own self-performance requirements. 23 CFR 635.116(d).

VII. SAFETY: ACCIDENT PREVENTION
This provision is applicable to all Federal-aid construction contracts and to all related subcontracts.

1. In the performance of this contract the contractor shall comply with all applicable Federal, State, and local laws governing safety, health, and sanitation (23 CFR Part 635). The contractor shall provide all safeguards, safety devices and protective equipment and take any other needed actions as it determines, or as the contracting officer may determine, to be reasonably necessary to protect the life and health of employees on the job and the safety of the public and to protect property in connection with the performance of the work covered by the contract. 23 CFR 635.108.

2. It is a condition of this contract, and shall be made a condition of each subcontract, which the contractor enters into pursuant to this contract, that the contractor and any subcontractor shall not permit any employee, in performance of the contract, to work in surroundings or under conditions which are unsanitary, hazardous or dangerous to his/her health or safety, as determined under construction safety and health standards (29 CFR Part 1926) promulgated by the Secretary of Labor, in accordance with Section 107 of the Contract Work Hours and Safety Standards Act (40 U.S.C. 3704). 29 CFR 1926.10.

3. Pursuant to 29 CFR 1926.3, it is a condition of this contract that the Secretary of Labor or authorized representative thereof, shall have right of entry to any site of contract performance to inspect or investigate the matter of compliance with the construction safety and health standards and to carry out the duties of the Secretary under Section 107 of the Contract Work Hours and Safety Standards Act (40 U.S.C. 3704).

VIII. FALSE STATEMENTS CONCERNING HIGHWAY PROJECTS
This provision is applicable to all Federal-aid construction contracts and to all related subcontracts.

In order to assure high quality and durable construction in conformity with approved plans and specifications and a high degree of reliability on statements and representations made by engineers, contractors, suppliers, and workers on Federal-aid highway projects, it is essential that all persons concerned with the project perform their functions as carefully, thoroughly, and honestly as possible. Willful falsification, distortion, or misrepresentation with respect to any facts related to the project is a violation of Federal law. To prevent any misunderstanding regarding the seriousness of these and similar acts, Form FHWA-1022 shall be posted on each Federal-aid highway project (23 CFR Part 635) in one or more places where it is readily available to all persons concerned with the project:
18 U.S.C. 1020 reads as follows:
"Whoever, being an officer, agent, or employee of the United States, or of any State or Territory, or whoever, whether a person, association, firm, or corporation, knowingly makes any false statement, false representation, or false report as to the character, quality, quantity, or cost of the material used or to be used, or the quantity or quality of the work performed or to be performed, or the cost thereof in connection with the submission of plans, maps, specifications, contracts, or costs of construction on any highway or related project submitted for approval to the Secretary of Transportation; or
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Local Assistance Procedures Manual Exhibit 12-G
Required Federal-Aid Contract Language

May 2023
Whoever knowingly makes any false statement, false
representation, false report or false claim with respect to the character, quality, quantity, or cost of any work performed or to be performed, or materials furnished or to be furnished, in connection with the construction of any highway or related project approved by the Secretary of Transportation; or
Whoever knowingly makes any false statement or false
representation as to material fact in any statement, certificate, or report submitted pursuant to provisions of the Federal-aid Roads Act approved July 11, 1916, (39 Stat. 355), as amended and supplemented;
Shall be fined under this title or imprisoned not more than 5 years or both."
IX. IMPLEMENTATION OF CLEAN AIR ACT AND FEDERAL
WATER POLLUTION CONTROL ACT (42 U.S.C. 7606; 2 CFR
200.88; EO 11738)
This provision is applicable to all Federal-aid construction contracts in excess of $150,000 and to all related subcontracts. 48 CFR 2.101; 2 CFR 200.326.

By submission of this bid/proposal or the execution of this contract or subcontract, as appropriate, the bidder, proposer, Federal-aid construction contractor, subcontractor, supplier, or vendor agrees to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act (42 U.S.C. 7401-7671q) and the Federal Water Pollution Control Act, as amended (33 U.S.C. 1251-1387). Violations must be reported to the Federal Highway Administration and the Regional Office of the Environmental Protection Agency. 2 CFR Part 200, Appendix II.

The contractor agrees to include or cause to be included the requirements of this Section in every subcontract, and further agrees to take such action as the contracting agency may direct as a means of enforcing such requirements. 2 CFR 200.326.

X. CERTIFICATION REGARDING DEBARMENT, SUSPENSION,

INELIGIBILITY AND VOLUNTARY EXCLUSION
This provision is applicable to all Federal-aid construction contracts, design-build contracts, subcontracts, lower-tier subcontracts, purchase orders, lease agreements, consultant contracts or any other covered transaction requiring FHWA approval or that is estimated to cost $25,000 or more – as defined in 2 CFR Parts 180 and 1200. 2 CFR 180.220 and 1200.220.

1. Instructions for Certification – First Tier Participants:
a. By signing and submitting this proposal, the prospective first tier participant is providing the certification set out below. b. The inability of a person to provide the certification set out below will not necessarily result in denial of participation in this covered transaction. The prospective first tier participant shall submit an explanation of why it cannot provide the certification set out below. The certification or explanation will be considered in connection with the department or agency's determination whether to enter into this transaction. However, failure of the prospective first tier participant to furnish a certification or an explanation shall disqualify such a person from participation in this transaction. 2 CFR 180.320.
c. The certification in this clause is a material representation of fact upon which reliance was placed when the contracting agency determined to enter into this transaction. If it is later determined that the prospective participant knowingly rendered an erroneous certification, in addition to other remedies available to the Federal Government, the contracting agency may terminate this transaction for cause of default. 2 CFR 180.325.
d. The prospective first tier participant shall provide immediate written notice to the contracting agency to whom this proposal is submitted if any time the prospective first tier participant learns that its certification was erroneous when submitted or has become erroneous by reason of changed circumstances. 2 CFR 180.345 and 180.350.
e. The terms "covered transaction," "debarred," "suspended," "ineligible," "participant," "person," "principal," and "voluntarily excluded," as used in this clause, are defined in 2 CFR Parts 180, Subpart I, 180.900-180.1020, and 1200. “First Tier Covered Transactions” refers to any covered transaction between a recipient or subrecipient of Federal funds and a participant (such as the prime or general contract). “Lower Tier Covered Transactions” refers to any covered transaction under a First Tier Covered Transaction (such as subcontracts). “First Tier Participant” refers to the participant who has entered into a covered transaction with a recipient or subrecipient of Federal funds (such as the prime or general contractor). “Lower Tier Participant” refers any participant who has entered into a covered transaction with a First Tier Participant or other Lower Tier Participants (such as subcontractors and suppliers).
f. The prospective first tier participant agrees by submitting this proposal that, should the proposed covered transaction be entered into, it shall not knowingly enter into any lower tier covered transaction with a person who is debarred, suspended, declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized by the department or agency entering into this transaction. 2 CFR 180.330.
g. The prospective first tier participant further agrees by submitting this proposal that it will include the clause titled "Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transactions," provided by the department or contracting agency, entering into this covered transaction, without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions exceeding the $25,000 threshold. 2 CFR 180.220 and 180.300.
h. A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that is not debarred, suspended, ineligible, or voluntarily excluded from the covered transaction, unless it knows that the certification is erroneous. 2 CFR 180.300; 180.320, and 180.325. A participant is responsible for ensuring that its principals are not suspended, debarred, or otherwise ineligible to participate in covered transactions. 2 CFR 180.335. To verify the eligibility of its principals, as well as the eligibility of any lower tier prospective participants, each participant may, but is not required to, check the System for Award Management website
(https://www.sam.gov/). 2 CFR 180.300, 180.320, and 180.325. i. Nothing contained in the foregoing shall be construed to require the establishment of a system of records in order to render in good faith the certification required by this clause. The knowledge and information of the prospective participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.
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Local Assistance Procedures Manual Exhibit 12-G
Required Federal-Aid Contract Language

May 2023
j. Except for transactions authorized under paragraph (f) of these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to other remedies available to the Federal Government, the department or agency may terminate this transaction for cause or default. 2 CFR 180.325. * * * * *

2. Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion – First Tier Participants:
a. The prospective first tier participant certifies to the best of its knowledge and belief, that it and its principals:
(1) Are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participating in covered transactions by any Federal department or agency, 2 CFR 180.335;.
(2) Have not within a three-year period preceding this proposal been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State, or local) transaction or contract under a public transaction; violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property, 2 CFR 180.800;
(3) Are not presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses enumerated in paragraph (a)(2) of this certification, 2 CFR 180.700 and 180.800; and (4) Have not within a three-year period preceding this
application/proposal had one or more public transactions (Federal, State or local) terminated for cause or default. 2 CFR 180.335(d).
(5) Are not a corporation that has been convicted of a felony violation under any Federal law within the two-year period preceding this proposal (USDOT Order 4200.6 implementing appropriations act requirements); and
(6) Are not a corporation with any unpaid Federal tax liability that has been assessed, for which all judicial and administrative remedies have been exhausted, or have lapsed, and that is not being paid in a timely manner pursuant to an agreement with the authority responsible for collecting the tax liability (USDOT Order 4200.6 implementing appropriations act requirements).
b. Where the prospective participant is unable to certify to any of the statements in this certification, such prospective participant should attach an explanation to this proposal. 2 CFR 180.335 and 180.340.

3. Instructions for Certification - Lower Tier Participants:
(Applicable to all subcontracts, purchase orders, and other lower tier transactions requiring prior FHWA approval or estimated to cost $25,000 or more - 2 CFR Parts 180 and 1200). 2 CFR 180.220 and 1200.220.
a. By signing and submitting this proposal, the prospective lower tier participant is providing the certification set out below. b. The certification in this clause is a material representation of fact upon which reliance was placed when this transaction was entered into. If it is later determined that the prospective lower tier participant knowingly rendered an erroneous certification, in addition to other remedies available to the Federal Government, the department, or agency with which this transaction originated may pursue available remedies, including suspension and/or debarment.
c. The prospective lower tier participant shall provide immediate written notice to the person to which this proposal is submitted if at any time the prospective lower tier participant learns that its certification was erroneous by reason of changed circumstances. 2 CFR 180.365.
d. The terms "covered transaction," "debarred," "suspended," "ineligible," "participant," "person," "principal," and "voluntarily excluded," as used in this clause, are defined in 2 CFR Parts 180, Subpart I, 180.900 – 180.1020, and 1200. You may contact the person to which this proposal is submitted for assistance in obtaining a copy of those regulations. “First Tier Covered Transactions” refers to any covered transaction between a recipient or subrecipient of Federal funds and a participant (such as the prime or general contract). “Lower Tier Covered Transactions” refers to any covered transaction under a First Tier Covered Transaction (such as subcontracts). “First Tier Participant” refers to the participant who has entered into a covered transaction with a recipient or subrecipient of Federal funds (such as the prime or general contractor). “Lower Tier Participant” refers any participant who has entered into a covered transaction with a First Tier Participant or other Lower Tier Participants (such as subcontractors and suppliers).
e. The prospective lower tier participant agrees by submitting this proposal that, should the proposed covered transaction be entered into, it shall not knowingly enter into any lower tier covered transaction with a person who is debarred, suspended, declared ineligible, or voluntarily excluded from participation in this covered transaction, unless authorized by the department or agency with which this transaction originated. 2 CFR 1200.220 and 1200.332. f. The prospective lower tier participant further agrees by submitting this proposal that it will include this clause titled "Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier Covered Transaction," without modification, in all lower tier covered transactions and in all solicitations for lower tier covered transactions exceeding the $25,000 threshold. 2 CFR 180.220 and 1200.220.
g. A participant in a covered transaction may rely upon a certification of a prospective participant in a lower tier covered transaction that is not debarred, suspended, ineligible, or voluntarily excluded from the covered transaction, unless it knows that the certification is erroneous. A participant is responsible for ensuring that its principals are not suspended, debarred, or otherwise ineligible to participate in covered transactions. To verify the eligibility of its principals, as well as the eligibility of any lower tier prospective participants, each participant may, but is not required to, check the System for Award Management website (https://www.sam.gov/), which is compiled by the General Services Administration. 2 CFR 180.300, 180.320, 180.330, and 180.335.
h. Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render in good faith the certification required by this clause. The knowledge and information of participant is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.
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Local Assistance Procedures Manual Exhibit 12-G
Required Federal-Aid Contract Language

May 2023
i. Except for transactions authorized under paragraph e of these instructions, if a participant in a covered transaction knowingly enters into a lower tier covered transaction with a person who is suspended, debarred, ineligible, or voluntarily excluded from participation in this transaction, in addition to other remedies available to the Federal Government, the department or agency with which this transaction originated may pursue available remedies, including suspension and/or debarment. 2 CFR 180.325.
* * * * *
Certification Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion--Lower Tier Participants:

1. The prospective lower tier participant certifies, by submission of this proposal, that neither it nor its principals:
(a) is presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participating in covered transactions by any Federal department or agency, 2 CFR 180.355;
(b) is a corporation that has been convicted of a felony violation under any Federal law within the two-year period preceding this proposal (USDOT Order 4200.6 implementing appropriations act requirements); and
(c) is a corporation with any unpaid Federal tax liability that has been assessed, for which all judicial and administrative remedies have been exhausted, or have lapsed, and that is not being paid in a timely manner pursuant to an agreement with the authority responsible for collecting the tax liability. (USDOT Order 4200.6 implementing appropriations act requirements)

2. Where the prospective lower tier participant is unable to certify to any of the statements in this certification, such prospective participant should attach an explanation to this proposal. * * * * *
XI. CERTIFICATION REGARDING USE OF CONTRACT FUNDS

FOR LOBBYING
This provision is applicable to all Federal-aid construction contracts and to all related subcontracts which exceed $100,000. 49 CFR Part 20, App. A.

1. The prospective participant certifies, by signing and submitting this bid or proposal, to the best of his or her knowledge and belief, that:
a. No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of any Federal agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. b. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any Federal agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard Form-LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions.

2. This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into.

Submission of this certification is a prerequisite for making or entering into this transaction imposed by 31 U.S.C. 1352. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.

3. The prospective participant also agrees by submitting its bid or proposal that the participant shall require that the language of this certification be included in all lower tier subcontracts, which exceed $100,000 and that all such recipients shall certify and disclose accordingly.

XII. USE OF UNITED STATES-FLAG VESSELS:

This provision is applicable to all Federal-aid construction contracts, design-build contracts, subcontracts, lower-tier subcontracts, purchase orders, lease agreements, or any other covered transaction. 46 CFR Part 381.

This requirement applies to material or equipment that is acquired for a specific Federal-aid highway project. 46 CFR 381.7. It is not applicable to goods or materials that come into inventories independent of an FHWA funded-contract.

When oceanic shipments (or shipments across the Great Lakes) are necessary for materials or equipment acquired for a specific Federalaid construction project, the bidder, proposer, contractor, subcontractor, or vendor agrees:

1. To utilize privately owned United States-flag commercial vessels to ship at least 50 percent of the gross tonnage (computed separately for dry bulk carriers, dry cargo liners, and tankers) involved, whenever shipping any equipment, material, or commodities pursuant to this contract, to the extent such vessels are available at fair and reasonable rates for United States-flag commercial vessels. 46 CFR 381.7.

2. To furnish within 20 days following the date of loading for shipments originating within the United States or within 30 working days following the date of loading for shipments originating outside the United States, a legible copy of a rated, ‘on-board’ commercial ocean bill-of-lading in English for each shipment of cargo described in paragraph (b)(1) of this section to both the Contracting Officer (through the prime contractor in the case of subcontractor bills-oflading) and to the Office of Cargo and Commercial Sealift (MAR620), Maritime Administration, Washington, DC 20590. (MARAD requires copies of the ocean carrier's (master) bills of lading, certified onboard, dated, with rates and charges. These bills of lading may contain business sensitive information and therefore may be submitted directly to MARAD by the Ocean Transportation Intermediary on behalf of the contractor). 46 CFR 381.7. #10..
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The United States Department of Transportation (USDOT)
Standard Title VI/Non-Discrimination Assurances
DOT Order No. 1050.2A
The California Department of Transportation (herein referred to as the “Recipient”), HEREBY AGREES THAT, as a condition to receiving any Federal financial assistance from the U.S. Department of Transportation (DOT), through the Federal Highway Administration (FHWA), is subject to and will comply with the following:

Statutory/Regulatory Authorities
• Title VI of the Civil Rights Act of 1964 (42 U.S.C § 2000d et seq., 78 stat. 252), (prohibits discrimination on the basis of race, color, national origin); • 49 C.F.R Part 21 (entitled Nondiscrimination In Federally-Assisted Programs Of The Department Of Transportation—Effectuation Of Title VI Of The Civil Rights Act Of 1964);
• 28 C.F.R. § 50.3 (U.S. Department of Justice Guidelines for Enforcement of Title VI of the Civil Rights Act of 1964)
The preceding statutory and regulatory cites hereinafter are referred to as the “Acts” and “Regulations,” respectively.

General Assurances
In accordance with the Acts, the Regulations, and other pertinent directives, circulars, policy, memoranda, and/or guidance, the Recipient herby gives assurance that it will promptly take any measures necessary to ensure that:
“No person in the United States shall, on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be otherwise subjected to discrimination under any program or activity,” for which the Recipient receives Federal financial assistance from DOT, including the FHWA.

The Civil Rights Restoration Act of 1987 clarified the original intent of Congress, with respect to Title VI and other Non-discrimination requirements (The Age Discrimination Act of 1975, and Section 504 of the Rehabilitation Act of 1973), by restoring the broad, institutional-wide scope and coverage of these nondiscrimination statutes and requirements to include all programs and activities of the Recipient, so long as any portion of the program is Federally assisted.

TITLE VI ASSURANCES
APPENDICES A – E

EXHIBIT C
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Specific Assurances
More specifically, and without limiting the above general Assurance, the Recipient agrees with and gives the following Assurances with respect to all programs or activities for which the Recipient receives Federal financial assistance:

1. The Recipient agrees that each “activity,” “facility,” or “program,” as defined in §§ 21.23 (b) and 21.23 € of 49 C.F.R. § 21 will be (with regard to an “activity”) facilitated, or will be (with regard to a “facility”) operated, or will be )with regard to a program”) conducted in compliance with all requirements imposed by, or pursuant to the Acts and the Regulations.

2. The Recipient will insert the following notification in all solicitations for bids, Requests For Proposals for work, or material subject to the Acts and the Regulations made in connection with all programs or activities for which the Recipient receives Federal financial assistance, and in adapted form, in all proposals for negotiated agreements regardless of funding source:
“The California Department of Transportation, in accordance with the provisions of Title VI of the Civil Rights Act of 1964 (78 Stat. 252, 42 U.S.C. §§ 2000d to 2000d-4) and the Regulations, hereby notifies all bidders that it will affirmatively insure that any contract entered into pursuant to this advertisement, disadvantaged business enterprises will be afforded full opportunity to submit bids in response to this invitation and will not be discriminated against on the grounds of race, color, or national origin for an award.”

3. The Recipient will insert the clauses of Appendix A and E of this Assurance in every contract or agreement subject to the Acts and the Regulations.

4. The Recipient will insert the clauses of Appendix B of this Assurance, as a covenant running with the land, in any deed from the United States effecting or recording a transfer of real property, structures, use, or improvements thereon or interest therein to a Recipient.

5. That where the Recipient receives Federal financial assistance to construct a facility, or part of a facility, the Assurance will extend to the entire facility and facilities operated in connection therewith. #10..
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6. That where the Recipient receives Federal financial assistance in the form, or for the acquisition of real property or an interest in real property, the Assurance will extend to rights to space on, over, or under such property.

7. That the Recipient will include the clauses set forth in Appendix C and Appendix D of this Assurance, as a covenant running with the land, in any future deeds, leases, licenses, permits, or similar instruments entered into by the Recipient with other parties:
a. for the subsequent transfer or real property acquired or improved under the applicable activity, project, or program; and b. for the construction or use of, or access to, space on, over, or under real property acquired or improved under the applicable activity, project, or program.

8. That this Assurance obligates the Recipient for the period during which Federal financial assistance is extended to the program, except where the Federal financial assistance is to provide, or is in the form of, personal property, or interest therein, or structures or improvements thereon, in which case the Assurance obligates the Recipient, or any transferee for the longer of the following periods:
a. the period during which the property is used for a purpose for which the Federal financial assistance is extended, or for another purpose involving the provision of similar services or benefits; or b. the period during which the Recipient retains ownership or possession of the property.

9. The Recipient will provide for such methods of administration for the program as are found by the Secretary of Transportation or the official to whom he/she delegates specific authority to give reasonable guarantee that it, other recipients, sub-recipients, sub-grantees, contractors, subcontractors, consultants, transferees, successors in interest, and other participants of Federal financial assistance under such program will comply with all requirements imposed or pursuant to the Acts, the Regulations, and this Assurance.
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10. The Recipient agrees that the United States has a right to seek judicial enforcement with regard to any matter arising under the Acts, the Regulations, and this Assurance.

By signing this ASSURANCE, the Recipient also agrees to comply (and require any sub-recipients, sub-grantees, contractors, successors, transferees, and/or assignees to comply) with all applicable provisions governing DOT’s access to records, accounts, documents, information, facilities, and staff. You also recognize that you must comply with any program or compliance reviews, and/or complaint investigations conducted by DOT. You must keep records, reports, and submit the material for review upon request to DOT, or its designee in a timely, complete, and accurate way. Additionally, you must comply with all other reporting, data collection, and evaluation requirements, as prescribed by law or detailed in program guidance.

The Recipient gives this ASSURANCE in consideration of and for obtaining any Federal grants, loans, contracts, agreements, property, and/or discounts, or other Federal-aid and Federal financial assistance extended after the date hereof to the recipients by the U.S. Department of Transportation under all programs or activities receiving Federal financial assistance. This ASSURANCE is binding on California, other recipients, sub-recipients, sub-grantees, contractors, subcontractors and their subcontractors’, transferees, successors in interest, and any other participants in all programs or activities receiving Federal financial assistance. The person(s) signing below is authorized to sign this ASSURANCE on behalf of the Recipient.

California Department of Transportation
(Name of Recipient)
by original signed by Toks Omishakin
(Signature of Authorized Official)
DATED 09/17/2021
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APPENDIX A
During the performance of this contract, the contractor, for itself, its assignees, and successors in interest (hereinafter referred to as the “contractor”) agrees as follows:

1. Compliance with Regulations: The contractor (hereinafter includes consultants) will comply with the Acts and the Regulations relative to Nondiscrimination in Federally-assisted programs of the U.S. Department of Transportation, Federal Highway Administration, as they may be amended from time to time, which are herein incorporated by reference and made a part of this contract.

2. Non-discrimination: The contractor, with regard to the work performed by it during the contract, will not discriminate on the grounds of race, color, national origin, age, sex, or disability in the selection and retention of subcontractors, including procurements of materials and leases of equipment. The contractor will not participate directly or indirectly in the discrimination prohibited by the Acts and the Regulations, including employment practices when the contract covers any activity, project, or program set forth in Appendix B of 49 CFR Part 21.

3. Solicitation for Subcontracts, Including Procurements of Materials and Equipment: In all solicitations, either by competitive bidding, or negotiation made by the contractor for work to be performed under a subcontract, including procurements of materials, or leases of equipment, each potential subcontractor or supplier will be notified by the contractor of the contractor’s obligations under this contract and the Acts and the Regulations relative to Non-discrimination on the grounds of race, color, national origin, age, sex, or disability.
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4. Information and Reports: The contractor will provide all information and reports required by the Acts, the Regulations, and directives issued pursuant thereto and will permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the Recipient or the FHWA to be pertinent to ascertain compliance with such Acts, Regulations, and instructions. Where any information required of a contractor is in the exclusive possession of another who fails or refuses to furnish the information, the contractor will so certify to the Recipient or the FHWA, as appropriate, and will set forth what efforts it has made to obtain the information.

5. Sanctions for Noncompliance: In the event of a contractor’s noncompliance with the Non-discrimination provisions of this contract, the Recipient will impose such contract sanctions as it or the FHWA may determine to be appropriate, including, but not limited to:

1. withholding payments to the contractor under the contract until the contractor complies; and/or

2. cancelling, terminating, or suspending a contract, in whole or in part.

6. Incorporation of Provisions: The contractor will include the provisions of paragraphs one through six in every subcontract, including procurements of materials and leases of equipment, unless exempt by the Acts, the Regulations and directives issued pursuant thereto. The contractor will take action with respect to any subcontract or procurement as the Recipient or the FHWA may direct as a means of enforcing such provisions including sanctions for noncompliance. Provided, that if the contractor becomes involved in, or threatened with litigation by a subcontractor, or supplier because of such direction, the contractor may request the Recipient to enter into any litigation to protect the interests of the Recipient. In addition, the contractor may request the United States to enter into the litigation to protect the interests of the United States. #10..
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APPENDIX B

CLAUSES FOR DEEDS TRANSFERRING UNITED STATES PROPERTY
The following clauses will be included in deeds effecting or recording the transfer of real property, structures, or improvements thereon, or granting interest therein from the United States pursuant to the provisions of Assurance 4:

NOW THEREFORE, the U.S. Department of Transportation as authorized by law and upon the condition that the California Department of Transportation will accept title to the lands and maintain the project constructed thereon in accordance with Title 23 U.S.C., the regulations for the administration of the preceding statute, and the policies and procedures prescribed by the FHWA of the U.S. Department of Transportation in accordance and in compliance with all requirements imposed by Title 49, Code of Federal Regulations, U.S. Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Non-discrimination in Federally-assisted programs of the U.S. Department of Transportation pertaining to and effectuating the provisions of Title VI of the Civil Rights Act of 1964 (78 Stat. 252; 42 U.S.C. § 2000d to 2000d-4), does hereby remise, release, quitclaim and convey unto the California Department of Transportation all the right, title and interest of the U.S. Department of Transportation in and to said lands described in Exhibit A attached hereto and made a part hereof. (HABENDUM CLAUSE)
TO HAVE AND TO HOLD said lands and interests therein unto the California Department of Transportation and its successors forever, subject, however, to the covenants, conditions, restrictions and reservations herein contained as follows, which will remain in effect for the period during which the real property or structures are used for a purpose for which Federal financial assistance is extended or for another purpose involving the provision of similar services or benefits and will be binding on the California Department of Transportation, its successors and assigns.
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The California Department of Transportation, in consideration of the conveyance of said lands and interest in lands, does hereby covenant and agree as a covenant running with the land for itself, its successors and assigns, that (1) no person will on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be otherwise subjected to discrimination with regard to any facility located wholly or in part on, over, or under such lands hereby conveyed [,] [and]* (2) that the California Department of Transportation will use the lands and interests in lands and interest in lands so conveyed, in compliance with all requirements imposed by or pursuant to Title 49, Code of Federal Regulations, U.S. Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Non-discrimination in Federally-assisted programs of the U.S. Department of Transportation, Effectuation of Title VI of the Civil Rights Act of 1964, and as said Regulations and Acts may be amended[, and (3) that in the event of breach of any of the above-mentioned non-discrimination conditions, the Department will have a right to enter or re-enter said lands and facilities on said lands, and that above described land and facilities will thereon revert to and vest in and become the absolute property of the U.S. Department of Transportation and its assigns as such interest existed prior to this instruction].*
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APPENDIX C

CLAUSES FOR TRANSFER OF REAL PROPERTY ACQUIRED OR IMPROVED UNDER THE

ACTIVITY, FACILITY, OR PROGRAM
The following clauses will be included in deeds, licenses, leases, permits, or similar instruments entered into by the California Department of Transportation pursuant to the provisions of Assurance 7(a):

A. The (grantee, lessee, permittee, etc. as appropriate) for himself/herself, his/her heirs, personal representatives, successors in interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree [in the case of deeds and leases add “as a covenant running with the land”] that:

1. In the event facilities are constructed, maintained, or otherwise operated on the property described in this (deed, license, lease, permit, etc.) for a purpose for which a U.S. Department of Transportation activity, facility, or program is extended or for another purpose involving the provision of similar services or benefits, the (grantee, licensee, lessee, permittee, etc.) will maintain and operate such facilities and services in compliance with all requirements imposed by the Acts and Regulations (as may be amended) such that no person on the grounds of race, color, or national origin, will be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities.

B. With respect to licenses, leases, permits, etc., in the event of breach of any of the above Non-discrimination covenants, the California Department of Transportation will have the right to terminate the (lease, license, permit, etc.) and to enter, re-enter, and repossess said lands and facilities thereon, and hold the same as if the (lease, license, permit, etc.) had never been made or issued.*
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C. With respect to a deed, in the event of breach of any of the above Nondiscrimination covenants, the California Department of Transportation will have the right to enter or re-enter the lands and facilities thereon, and the above described lands and facilities will there upon revert to and vest in and become the absolute property of the California Department of Transportation and its assigns.*
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APPENDIX D
CLAUSES FOR CONSTRUCTION/USE.ACCESS TO REAL PROPERTY ACQUIRED UNDER

THE ACTIVITY, FACILITY OR PROGRAM
The following clauses will be included in deeds, licenses, permits, or similar instruments/agreements entered into by the California Department of Transportation pursuant to the provisions of Assurance 7(b):

A. The (grantee, licensee, permittee, etc., as appropriate) for himself/herself, his/her heirs, personal representatives, successors in interest ,and assigns, as a part of the consideration hereof, does hereby covenant and agree (in the case of deeds and leases add, “as a covenant running with the land”) that (1) no person on the ground of race, color, or national origin, will be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities, (2) that in the construction of any improvements on, over, or under such land, and the furnishings of services thereon, no person on the ground of race, color, or national origin, will be excluded from participation in, denied the benefits or, or otherwise be subjected to discrimination, (3) that the (grantee, licensee, lessee, permittee, etc.) will use the premises in compliance with all other requirements imposed by or pursuant to the Acts and Regulations, as amended, set forth in this Assurance.

B. With respect to (licenses, leases, permits, etc.) in the event of breach of any of the above of the above Non-discrimination covenants, the California Department of Transportation will have the right to terminate the (license, permits, etc., as appropriate) and to enter or re-enter and repossess said land and the facilities thereon, and hold the same as if said (license, permit, etc., as appropriate) had never been made or issued.* C. With respect to deeds, in the event of breach of any of the above Nondiscrimination covenants, the California Department of Transportation will there upon revert to and vest in and become the absolute property of the California Department of Transportation and its assigns. (*Reverter clause and related language to be used only when it is determined that such a clause is necessary to make clear the purpose of Title VI.) #10..
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APPENDIX E
During the performance of this contract, the contractor, for itself, its assignees, and successors in interest (hereinafter referred to as the “contractor”) agrees to comply with the following non-discrimination statutes and authorities, including, but not limited to:

Pertinent Non-Discrimination Authorities:
• Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq., 78 stat. 252), prohibits discrimination on the basis of race, color, national origin); and 49 CFR Part 21.
• The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, (42 U.S.C. § 4601), (prohibits unfair treatment of persons displaced or whose property has been acquired because of Federal or Federal-aid programs and projects);
• Federal-Aid Highway Act of 1973, (23 U.S.C. § 324 et seq.), prohibits discrimination on the basis of sex;
• Section 504 of the Rehabilitation Act of 1973, (29 U.S.C. § 794 et seq.), as amended, (prohibits discrimination on the basis of disability); and 49 CR Part 27;
• The Age Discrimination Act of 1975, as amended, (42 U.S.C. § 6101 et seq.), prohibits discrimination on the basis of age);
• Airport and Airway Improvement Act of 1982, (49 U.S.C. § 471, Section 47123), as amended, (prohibits discrimination based on race, creed, color, national origin, or sex);
• The Civil Rights Restoration Act of 1987, (PL 100-209), (Broadened the scope, coverage and applicability of Title VI of the Civil Rights Act of 1964, The Age Discrimination Act of 1975 and Section 504 of the Rehabilitation Act of 1973, by expanding the definition of the terms “programs or activities” to include all of the programs or activities of the Federal-aid recipients, sub-recipients and contractors, whether such programs or activities are Federally funded or not);
• Titles II and III of the Americans with Disabilities Act, which prohibit discrimination of the basis of disability in the operation of public entities, public and private transportation systems, places of public accommodation, and certain testing entities (42 U.S.C. §§ 12131 – 12189) as implemented by Department of Transportation regulations 49 C.F.R. parts 37 and 38;
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• The Federal Aviation Administration’s Non-discrimination statute (49 U.S.C. § 47123) (prohibits discrimination on the basis of race, color, national origin, and sex);
• Executive Order 12898, Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations, which ensures discrimination against minority populations by discouraging programs, policies, and activities with disproportionately high and adverse human health or environmental effects on minority and low-income populations; • Executive Order 13166, Improving Access to Services for Persons with Limited English Proficiency, and resulting agency guidance, national origin discrimination includes discrimination because of limited English proficiency (LEP). To ensure compliance with Title VI, you must take reasonable steps to ensure that LEP persons have meaningful access to your programs (70 Fed. Reg. at 74087 to 74100);
• Title IX of the Education Amendments of 1972, as amended, which prohibits you from discriminating because of sex in education programs or activities (20 U.S.C. 1681 et seq).
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

August 22, 2023
Date: July 17, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
SUBJECT: Patrol Vehicles and Fire Boat and Trailer Replacement – Purchase Update CONTACT: Dianne Love, Purchasing Manager, [email protected], 209-571-5164 DESCRIPTION:

Consider accepting an Informational Update on the purchase of nine (9) Modesto Police Department Patrol Vehicles and one (1) Modesto Fire Department Boat with Trailer replacement. (Funding Source: General Fund and Fleet Replacement Fund) STRATEGIC PLAN ELEMENT:

This item is related to the 2020-2025 Strategic Plan goal of improving community safety and quality of life through a combination of prevention and intervention efforts that address safety and its underlying issues. (Goal A of Quality of Life Goals and Strategies)”.

BACKGROUND:

Every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs. In addition, these vehicles and equipment could no longer be serviceable due to vehicle accidents occurring in the field. Following this process, a Fleet Replacement List is submitted to Council annually and is approved as part of the new fiscal year’s Fleet Replacement Budget.

Below is a breakdown of these Fleet Replacement list with the details of the current vehicles.

Fiscal
Year
Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
Refer to Exhibit A on the Fleet Replacement details for the MPD Patrol Vehicles.

These vehicles are used in daily law enforcement activities city wide for the Modesto Police Department.
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City Council, August 22, 2023
Patrol Vehicles and Fire Board and Trailer Replacements

Fiscal
Year
Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
22-23 60202 Boat MFD – Suppression 2002 N/A N/A
22-23 89701 Trailer MFD – Suppression 1997 N/A N/A
22-23 70299 Motor MFD – Suppression 2002 N/A N/A
The boat and trailer are used to provide water rescue services on the various bodies of water in and around our protection area.

On April 11, 2023 under Resolution 2023-192, Council approved the Modesto Police Department (MPD) Patrol Vehicles and Modesto Fire Department (MFD) Boat with Trailer replacements under Exhibit A and authorized the City Manager or his designee to issue the Purchase Orders once vehicles became available. This item was requested by staff due to the challenges with securing these critical safety vehicles with the supply demands in the vehicle market. As purchases were made City staff would report to Council all Purchase Orders issued by the City Manager and the background of these purchases.

DISCUSSION:

MPD Nine (9) Ford Interceptors
The Modesto Police Department notified the Public Works and Finance Department about five (5) Ford Interceptors for sale through an online car sale website1 utilized by car dealership across the United States. City staff reached out to the car dealer Boggus Motor Company, Harlingen, TX to review the vehicle specifications to ensure it met the requirements needed for the Modesto Police Department Patrol Vehicles. City staff concluded these vehicles met our specification requirements and during this process four (4) additional Ford Interceptors became available with the same dealer for a total of (9) Ford Interceptors. Prior to issuing the Purchase Order for this purchase, City staff had attempted to secure this type of vehicle through Future Chevrolet of Sacramento, California and White Ford, North Carolina and within a short time period they had already sold these vehicles to other government agencies due to the public safety vehicle shortage and supply demands needed by law enforcement across the nation.

In reviewing the price analysis for these vehicles, they align with the current market compared to the other dealer prices and even with an additional cost for transporting the vehicle it still provided a lower cost due to the 12–18-month lead time it would take to secure a vehicle near Modesto with no guarantee of delivery. If the City purchased a vehicle from a dealer that is still manufacturing the vehicle, the current wait times has ranged from 9-18 months with increases being requested by dealers once delivery dates are scheduled which range from 10-20%. With the securing of these nine (9) Ford Interceptors with Boggus Motor Company, City staff issued the Purchase Order on May 12, 2023 in the amount of $470,275 and the first delivery of six (6) Ford Interceptors occurred on June 2, 2023 with a second delivery of one (1) Ford Interceptors occurring on June 10, 2023. The remaining two (2) were delivered to the City on July 28, 2023.

MFD Boat with Trailer
On Saturday, March 25, 2023, the sole water rescue boat owned by the Modesto Fire Department (MFD) was involved in an accident on the way to a call, which resulted in a total loss of the boat as well as its trailer. The MFD boat with trailer is a specialized type of boat that can only be purchased from a selected group of vendors. Due to the urgency of needing to purchase a new boat with the required fire safety specifications and the availability of delivery 1 Truecar.com
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City Council, August 22, 2023
Patrol Vehicles and Fire Board and Trailer Replacements

from these vendors, the MFD was able to secure a boat with trailer with First Responder Boat LLC, Murray, KY in the amount of $42,671 including sales tax for an overall total of $47,335.

City staff issued a Purchase Order to First Responder Boat on May 11, 2023 and delivery is expected in mid to late August 2023.

FISCAL IMPACT:

Sufficient funds for these Patrol Vehicle replacements and Fire Boat with Trailer were set aside from savings from the prior Fiscal Year 2022-23. The costs for the Fire Boat with Trailer will be absorbed with the FY 2022-23 savings Fire Department operating budget because it was not previously included in the Fleet Replacement Fund. For the nine (9) MPD Ford Interceptors, the Fleet Replacement fund has collected the funding to pay for these replacements and the General Fund Fleet Replacement fund has sufficient reserves to account for the replacements in Fiscal Year 2023-24.

COMMITTEE RECOMMENDATION:

This item has not gone before a committee.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Motion accepting an Informational Update on the purchase of nine (9) Modesto Police Department Patrol Vehicles and one (1) Modesto Fire Department Boat with Trailer replacement.

Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:

1. Exhibit A

2. Ford Interceptors Quote

3. Fire Boat with Trailer Quote
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Exhibit A - Modesto Police Department - Patrol Vehicles and Modesto Fire Boat/Trailer Replacement
Year Line # Vehicle Description Old Unit Fund Cost Center Cost Center Description Year of
Vehicle Meter Repair Cost
Estimated
Replacement Cost
FY 21-22 1 TRK 1/2 TON RESPONDER 11108 0100 19320 MPD - Police Field Ops. 2011 108,875 $ 59,194 $63,250 FY 21-22 2 TRK 1/2 TON RESPONDER 11192 0100 19320 MPD - Police Field Ops. 2011 72,787 $ 43,499 $63,250 FY 21-22 3 TRK 1/2 TON RESPONDER 31434 0100 19320 MPD - Police Field Ops. 2014 89,287 $ 69,516 $63,250 FY 21-22 4 SUV PATROL 31522 0100 19320 MPD - Police Field Ops. 2015 114,880 $ 63,746 $63,250 FY 21-22 5 SUV PATROL 31524 0100 19320 MPD - Police Field Ops. 2015 114,880 $ 54,499 $63,250 FY 21-22 6 SUV PATROL 31725 0100 19320 MPD - Police Field Ops. 2017 108,914 $ 69,731 $63,250 FY 21-22 7 SUV PATROL 31729 0100 19320 MPD - Police Field Ops. 2017 109,271 $ 55,822 $63,250 FY 21-22 8 SUV PATROL 31620 0100 19320 MPD - Police Field Ops. 2016 98,778 $ 61,629 $63,250 FY 21-22 9 SUV PATROL 31645 0100 19320 MPD - Police Field Ops. 2016 112,976 $ 61,629 $63,250 FY 22-23 10 SEDAN PATROL/SUV Patrol 32106 0100 19320 MPD - Police Field Ops. 2021 10,973 $ 11,941 $57,500 FY 22-23 11 SUV PATROL 32102 0100 19320 MPD - Police Field Ops. 2021 18,297 $ 11,942 $57,500 FY 22-23 12 SUV PATROL 31842 0100 19320 MPD - Police Field Ops. 2018 55,647 $ 37,045 $57,500 FY 22-23 13 SUV PATROL 31727 0100 19320 MPD - Police Field Ops. 2017 120,041 $ 68,830 $57,500 FY 22-23 14 SUV PATROL 31434 0100 19320 MPD - Police Field Ops. 2014 118,003 $ 86,493 $57,500 FY 22-23 15 SUV PATROL 31809 0100 19320 MPD - Police Field Ops. 2018 109,900 $ 54,620 $57,500 FY 22-23 16 SUV PATROL 31750 0100 19320 MPD - Police Field Ops. 2017 105,430 $ 61,603 $57,500 FY 22-23 17 SUV PATROL 31713 0100 19320 MPD - Police Field Ops. 2017 103,409 $ 58,648 $57,500 FY 22-23 18 SUV PATROL 11192 0100 19320 MPD - Police Field Ops. 2011 82,626 $ 47,688 $57,500 FY 22-23 19 FIRE BOAT 60202 0100 18210 MFD - Surpression 2002 N/A N/A FY 22-23 20 FIRE TRAILER 89701 0100 18210 MFD - Surpression 1997 N/A N/A FY 22-23 21 FIRE MOTOR 70299 0100 18210 MFD - Surpression 2002 N/A N/A FY 23-24 22 SUV PATROL SGT UAV 31407 0100 19320 MPD - Police Field Ops 2014 85,118 $ 79,311 $62,330 FY 23-24 23 SUV PATROL 31544 0100 19320 MPD - Police Field Ops 2015 119,200 $ 121,632 $57,500 FY 23-24 24 SUV PATROL SGT 31549 0100 19320 MPD - Police Field Ops 2015 114,467 $ 62,229 $57,500 FY 23-24 25 SUV PATROL LP READER 31519 0100 19320 MPD - Police Field Ops 2015 112,906 $ 83,411 $57,500 FY 23-24 26 SUV PATROL 31664 0100 19320 MPD - Police Field Ops 2016 124,113 $ 86,066 $57,500 FY 23-24 27 SUV PATROL 31760 0100 19320 MPD - Police Field Ops 2017 116,347 $ 61,226 $57,500 FY 23-24 28 SUV PATROL 31721 0100 19320 MPD - Police Field Ops 2017 105,076 $ 84,225 $57,500 FY 23-24 29 SUV PATROL 31718 0100 19320 MPD - Police Field Ops 2017 90,908 $ 47,513 $57,500 FY 23-24 30 SUV PATROL 31762 0100 19320 MPD - Police Field Ops 2017 83,650 $ 81,626 $57,500 FY 23-24 31 SUV PATROL 31727 0100 19320 MPD - Police Field Ops 2017 120,041 $ 68,830 $57,500 FY 23-24 32 SUV PATROL 31713 0100 19320 MPD - Police Field Ops 2017 103,409 $ 58,648 $57,500 FY 23-24 33 SUV PATROL 31750 0100 19320 MPD - Police Field Ops 2017 105,430 $ 61,603 $57,500 FY 23-24 34 SUV PATROL 31857 0100 19320 MPD - Police Field Ops 2018 86,887 $ 55,567 $57,500 FY 23-24 35 SUV PATROL 31809 0100 19320 MPD - Police Field Ops 2018 109,900 $ 54,620 $57,500 FY 23-24 36 SUV PATROL 31840 0100 19320 MPD - Police Field Ops 2018 84,867 $ 48,011 $57,500 Total $2,004,080
$50,000
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Quote #04292023
Boggus Motor Co. 2521 S Expressway 83 Harlingen, Texas 78550 Qty Base Price
4 Black/Interceptor Utility AWD Base (K8A) $46,445.00 $185,780.00 4 Less Government Price Concession $1,600.00 $6,400.00
4 Documentary Fee & State Inspection $183.75 $735.00
4 Destination Charge $1,495.00 $5,980.00
$46,523.75
5 White/Interceptor Utility AWD Base (K8A) $46,445.00 $232,225.00 5 Less Government Price Concession $1,600.00 $8,000.00
5 Documentary Fee & State Inspection $183.75 $918.75
5 Destination Charge $1,495.00 $7,475.00
$46,523.75
$418,713.75
9 State Tax 8.875% $37,160.85
9 DMV Registration Fees
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Prices and content availability as shown are subject to change and should be treated as estimates only. Actual base vehicle, package and option pricing may vary from this estimate because of special local pricing, availability or pricing adjustments not reflected in the dealer’s computer system. See salesperson for the most current information.

Prepared for: DAVID BARR

FLEET MANAGER, CITY OF MODESTO
Prepared by: Stephen Hollon
04/29/2023 Boggus Motor Co. | 2521 S Expressway 83 Harlingen Texas | 78550 2023 Police Interceptor Utility AWD Base (K8A)
Price Level: 315 | Stock No: QUOTE ONLY | VIN: QUOTE ONLY

DAVID BARR, FLEET MANAGER, CITY OF

MODESTO
1609 8th STREET
MODESTO, CA 75354
Office: 209-343-2214
End User FIN Code: QB106
Re: Vehicle Proposal 04/29/2023
Dear DAVID,
Thank you very much for your interest in acquiring a vehicle from our dealership. We concur that your interest is well deserved. We hope that an outstanding product lineup and our dedication to customer service will enhance your ownership experience should you decide to buy a vehicle from us.

Attached, please find additional information that I hope will assist you in making a more informed decision.

Please feel free to contact me at any time as I would truly appreciate the opportunity to be of service to you.

Sincerely,
Stephen Hollon
Commercial Accounts Fleet Manager
[email protected]
1 VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION

VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION #11..
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Prices and content availability as shown are subject to change and should be treated as estimates only. Actual base vehicle, package and option pricing may vary from this estimate because of special local pricing, availability or pricing adjustments not reflected in the dealer’s computer system. See salesperson for the most current information.

Prepared for: DAVID BARR

FLEET MANAGER, CITY OF MODESTO
Prepared by: Stephen Hollon
04/29/2023 Boggus Motor Co. | 2521 S Expressway 83 Harlingen Texas | 78550 2023 Police Interceptor Utility AWD Base (K8A)
Price Level: 315 | Stock No: QUOTE ONLY | VIN: QUOTE ONLY As Configured Vehicle
Code Description MSRP
Base Vehicle
K8A Base Vehicle Price (K8A) $47,165.00
Packages
500A Order Code 500A N/C
Includes:
- 3.73 Axle Ratio
- GVWR: 6,840 lbs (3,103 kgs)
- Tires: 255/60R18 AS BSW
- Wheels: 18" x 8" 5-Spoke Painted Black Steel
Includes polished stainless steel hub cover and center caps. - Unique HD Cloth Front Bucket Seats w/Vinyl Rear
Includes reduced bolsters, driver 6-way power track (fore/aft. up/down, tilt with manual recline, 2- way manual lumbar), passenger 2-way manual track (fore/aft. with manual recline) and built-in steel intrusion plates in both driver/passenger seatbacks.
- Radio: AM/FM/MP3 Capable
Includes clock, 4-speakers, Bluetooth interface with hands-free voice command support (compatible with most Bluetooth connected mobile devices), 1 USB port and 4.2" color LCD screen center stack smart display.

Powertrain
99B Engine: 3.3L V6 Direct-Injection
(FFV)
-$2,830.00
(136-MPH top speed). Note: Deletes regenerative braking and lithium-ion battery pack; adds 250- Amp alternator, replaces H7 AGM battery (800 CCA/80-amp) with H7 SLI battery (730 CCA/80- amp) and replaces 19-gallon tank with 21.4-gallon.
44U Transmission: 10-Speed Automatic
(44U)
N/C
STDAX 3.73 Axle Ratio Included
STDGV GVWR: 6,840 lbs (3,103 kgs) Included
Wheels & Tires
STDTR Tires: 255/60R18 AS BSW Included
STDWL Wheels: 18" x 8" 5-Spoke Painted
Black Steel
Included
Includes polished stainless steel hub cover and center caps.

Seats & Seat Trim
9 Unique HD Cloth Front Bucket Seats
w/Vinyl Rear
Included
2 VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION

VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION #11..
- 326 -
Prices and content availability as shown are subject to change and should be treated as estimates only. Actual base vehicle, package and option pricing may vary from this estimate because of special local pricing, availability or pricing adjustments not reflected in the dealer’s computer system. See salesperson for the most current information.

Prepared for: DAVID BARR

FLEET MANAGER, CITY OF MODESTO
Prepared by: Stephen Hollon
04/29/2023 Boggus Motor Co. | 2521 S Expressway 83 Harlingen Texas | 78550 2023 Police Interceptor Utility AWD Base (K8A)
Price Level: 315 | Stock No: QUOTE ONLY | VIN: QUOTE ONLY As Configured Vehicle (cont'd)
Code Description MSRP
Includes reduced bolsters, driver 6-way power track (fore/aft. up/down, tilt with manual recline, 2- way manual lumbar), passenger 2-way manual track (fore/aft. with manual recline) and built-in steel intrusion plates in both driver/passenger seatbacks.

Other Options
PAINT Monotone Paint Application STD
119WB 119" Wheelbase STD
STDRD Radio: AM/FM/MP3 Capable Included
Includes clock, 4-speakers, Bluetooth interface with hands-free voice command support (compatible with most Bluetooth connected mobile devices), 1 USB port and 4.2" color LCD screen center stack smart display.
86T Tail Lamp/Police Interceptor Housing
Only
$60.00
Pre-existing holes with standard twist lock sealed capability (does not include LED strobe) (eliminates need to drill housing assemblies).
153 Front License Plate Bracket N/C
60A Grille LED Lights, Siren & Speaker
Pre-Wiring
$50.00
51S Dual (Driver & Passenger) LED Spot
Lamps (Unity)
$620.00
68G Rear-Door Controls Inoperable $75.00
Locks, handles and windows. Note: Can manually remove window or door disable plate with special tool. Note: Locks/windows operable from driver's door switches. 55F Remote Keyless Entry Key Fob w/o
Key Pad
$340.00
Does not include PATS. Includes 4-key fobs. Key fobs are not fobbed alike when ordered with keyed-alike.
76R Reverse Sensing System $275.00
17A Rear Auxiliary Air Conditioning $610.00
60R Noise Suppression Bonds (Ground
Straps)
$100.00
Emissions
425 50 State Emission System STD
Flexible Fuel Vehicle (FFV) system is standard equipment for vehicles equipped with the 3.3L V6 Direct-Injection engine.
3 VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION

VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION #11..
- 327 -
Prices and content availability as shown are subject to change and should be treated as estimates only. Actual base vehicle, package and option pricing may vary from this estimate because of special local pricing, availability or pricing adjustments not reflected in the dealer’s computer system. See salesperson for the most current information.

Prepared for: DAVID BARR

FLEET MANAGER, CITY OF MODESTO
Prepared by: Stephen Hollon
04/29/2023 Boggus Motor Co. | 2521 S Expressway 83 Harlingen Texas | 78550 2023 Police Interceptor Utility AWD Base (K8A)
Price Level: 315 | Stock No: QUOTE ONLY | VIN: QUOTE ONLY As Configured Vehicle (cont'd)
Code Description MSRP
Exterior Color
UM_01 Agate Black N/C
Interior Color
96_01 Charcoal Black w/Unique HD Cloth
Front Bucket Seats w/Vinyl Rear
N/C
Upfit Options
FORD CODE 59W DELETE WI-FI HOTSPOT 4G LTE -$20.00
SUBTOTAL $46,445.00
Destination Charge $1,495.00
TOTAL $47,940.00
4 VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION

VEHICLE(S) ARE SUBJECT TO PRIOR SALE IF SOLD BEFORE YOUR PURCHASE DECISION

PRICE PER VEHICLE BEFORE FORD PRICE CONCESSION
LESS GOVERNMENT PRICE CONCESSION FIN QB106 - 1,600.00
NET SELLING PRICE PER VEHICLE =$46,340.00 *
DOCUMENTARY FEE & STATE INSPECTION + 183.75 *
TOTAL PER VEHICLE FOB HARLINGEN, TEXAS =$46,523.75 *
* PRICE DOES NOT INCLUDE FREIGHT CHARGES TO MODESTO, CALIFORNIA AS WELL AS

THERE ARE NO CALIFORNIA TAXES AND REGISTRATION FEES INCLUDED IN THIS PRICE AS WELL. THESE FEES WOULD BE EXTRA AS IN TEXAS GOVERNMENT AGENCIES DO NOT PAY TAXES ON VEHICLES AS CALIFORNIA DOES.
#11..
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Quote #33123 PO#246706
First Responder Boats, LLC out of Murry, KY
Qty Description Base Price Extended Cost
1 2024 AB A14S Shallow Water Alum Inflatable Boat $25,008.00 $25,008.00 1 2023 Mercury Elpt 60/40 Four Stroke Engine w/15" Shaft $8,080.00 $8,080.00 1 Trailer Heavy Duty Aluminum 3500lb torsion axles $4,228.00 $4,228.00 2 4" Cutom Aluminum Riser with Track & pre-wire $220.00 $440.00 1 Heavy Duty Aluminum Load Plate Optimum Jet Performance $175.00 $175.00 1 Aluminum Intake Fins for Jet performance $90.00 $90.00 $38,021.00
Potential Add On
1 Go Light GXL Spot or Flood with Ram Mounts $350.00 $350.00 1 Go Light GXL "Stryker ST" Remote Led Spotlight with Key Fob $650.00 $650.00 1 Documentary Fee & State Inspection $183.75 $183.75
1 $39,204.75
State Tax 8.875% (Vendor does not collect the Tax; City will remit directly with CA Tax Board) $3,479.42 Destination Charge $4,650.00 $4,650.00
Grand Total $47,334.17
#11..
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#11..
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

August 22, 2023
Date: August 1, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
Bill Sandhu, Public Works Director
SUBJECT: Fleet Addition and Replacements – Dump Trucks, Forklift Variable Reach, and Packers
CONTACT: Dianne Love, Purchasing Manager, [email protected], 209-571-5164 DESCRIPTION:

Consider approving the purchase for Fleet Addition and Replacements of thirteen (13) Dump Truck, two (2) Forklift Variable Reach and three (3) Packers in the amount not to exceed $4,637,991. (Funding Source: Surface Transportation Fund and Fleet Replacement Fund) STRATEGIC PLAN ELEMENT:

This item advances the City of Modesto 2020-2025 Strategic Plan Area: Governance and Service Delivery: “build community trust in City government through responsive, transparent and efficient service delivery”; Goal J: “build a high-performance organization”.

BACKGROUND:

Every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs. Following this process, a Fleet Replacement List is submitted to Council and is approved as part of a new fiscal year’s Fleet Replacement Budget.

Throughout the fiscal year, new vehicles need to be added to the City’s Fleet inventory due to the operational needs of City departments. When these vehicles are added to the fleet, they are also added to the Fleet Replacement list to prepare for future replacement.

Fleet Addition:

IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
2324-06 Addition Dump Truck PW-Curbs,
Gutters&
Sidewalks

N/A N/A N/A
This vehicle will be used for the removal of damaged and discarded concrete and asphalt, the delivery of rock and other materials to job sites as well as towing an equipment trailer with various machines to perform assigned work.
#12..
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City Council, August 22, 2023
Fleet Addition and Replacements – Dump Trucks, Forklift Variable Reach, and Packers

Fleet Replacements:

IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
40429 Dump Truck UTL- Water 2004 97,655 $91,946
40263 Dump Truck UTL Water 2002 59,201 $106,206
40264 Dump Truck UTL Water 2002 108,520 $128,526
40266 Dump Truck PW – Streets 2002 101,781 $100,226
40261 Dump Truck UTL - Wastewater 2002 86,176 $135,388
40265 Dump Truck UTL - Wastewater 2002 109,715 $122,592 40267 Dump Truck PW-Curbs,
Gutters and
Sidewalks 2002 88,828 $116,782
41022 Dump Truck UTL Water 2010 96,743 $107,354
40841 Dump Truck UTL - Wastewater 2008 33,920 $58,313
40901 Dump Truck PW – Streets 2009 73,250 $77,423
40923 Dump Truck PW-Curbs,
Gutters and
Sidewalks 2009 58,884 $89,307
2324-06
40928 Dump Truck PW-Curbs,
Gutters and
Sidewalks 2009 76,772 $85,582
These vehicles are used by the various operational departments to carry out their normal service to the community hauling parts and supplies to make repairs to infrastructure around the City of Modesto.

IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
2324-05 59824 Forklift UTL – Water 1998 4,419 $32,185
50708 Forklift UTL -Wastewater 2007 3,860 $11,145
These vehicles are used around the Water site and Sutter site for maintaining equipment and buildings
IFB Vehicle
#
Description Dept. Year of
Vehicle
Meter Repair
Cost
41301 Packers PW-Green Waste 2013 118,200 $170,722
41302 Packers PW-Green Waste 2013 140,905 $223,116
2324-04
41303 Packers PW-Green Waste 2013 122,447 $208,429
These vehicles transport green waste from City of Modesto neighborhoods to the Compost Facility
DISCUSSION:

Invitation for Bid (IFB) 2324-06 – Thirteen (13) Dump Trucks On June 17, 2021, Sourcewell issued Request for Proposals (RFP) #0850521 under Contract #0850521-PBL for Roadway Maintenance Equipment on the Sourcewell Procurement Portal, New York State Contract Reporter, DJC Oregon, McClatchy and PublicPurchase.com. On #12..
- 333 -
City Council, August 22, 2023
Fleet Addition and Replacements – Dump Trucks, Forklift Variable Reach, and Packers

August 27, 2021, proposals were conducted electronically through the Sourcewell Procurement Portals. Thirty (30) proposals were received and based on the Sourcewell Proposal Review Committee and criteria outlined in the RFP, six (6) contracts were awarded for this commodity which includes the Dump Trucks. Based on the responsible and responsible proposer offering the best overall quality, selection of equipment and price, City staff recommends to award to PB Loader Corporation, Fresno, CA to purchase thirteen (13) Dump Trucks for an amount not to exceed $2,803,943.

Invitation for Bid (IFB) 2324-05 – Two (2) Forklift Variable Reach On January 31, 2019, Sourcewell issued Request for Proposals (RFP) #032119 under Contract #032119-CAT for New and Used Construction and Paving Equipment, Parts and Services and accessories on the Sourcewell Procurement Portal, New York State Contract Reporter website, the State Media Company, Utah Media Group, and PublicPurchase.com. On March 22, 2019, proposals were conducted at the Sourcewell Procurement office in Staples, MN. Fifteen (15) proposals were received and based on the Sourcewell Proposal Review Committee and criteria outlined in the RFP, nine (9) contracts were awarded for this commodity which includes the two (2) Forklift Variable Reach. Based on the responsible and responsive proposer offering the best overall quality, selection of equipment and price, City staff recommends to award to Caterpillar Inc. Peoria, IL under authorized dealer Holt of California, Stockton, CA to purchase two (2) Forklift Variable Reach for an amount not to exceed $241,893.

Invitation for Bid (IFB) 2324-05 – Three (3) Packers
On June 9, 2020, Sourcewell issued Request for Proposals (RFP) #060920 under Contract #060920-MAK for Class 4-8 Chassis with Related Equipment, Accessories, and Services on the Sourcewell Procurement Portal, Utah Media Group, USA Today, South Carolina – The State, New York State Contract Reporter, Oregon Daily Journal of Commerce, and Public Purchase.

On July 21, 2020 proposals were conducted at the Sourcewell Procurement office in Staples, MN. Twenty-five (25) proposals were received and based on the Sourcewell Proposal Review Committee and criteria outlined in the RFP, nine (9) contracts were awarded for this commodity which includes the three (3) Packers. The Attached quote in the amount of $360,406 provides the pricing for one Packer. Based on the responsible and responsible proposer offering the best overall quality, selection of equipment and price, City staff recommends to award to Mack Trucks, Inc Greensboro, NC under the authorized dealer Western Truck Center, Sacramento, CA to purchase three (3) Packers for an amount not to exceed $1,081,218.

Sourcewell is a cooperative agreement to streamline the procurement process by developing IFBs or Request for Proposals (RFP)’s for national competitive solicitations that meet or exceed local requirements. The competitive process is continually refined to best meet agency needs and allows Sourcewell to offer exceptional products from nationally acclaimed vendors.

City staff is recommending to apply a change order of up to 15% in case any market changes occur between the timeframe of when the order is placed with the vendor and when the production of the vehicle is completed. With current inflation and the volatile vehicle market, City staff will ensure any prices increases requested by the vendor align with the market change based on using the Commodities Research Unit indexes which focuses on indexes related to steel1.
1 https://www.crugroup.com/prices/steel/
#12..
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City Council, August 22, 2023
Fleet Addition and Replacements – Dump Trucks, Forklift Variable Reach, and Packers

With the new vehicle and heavy equipment purchases being requested, the City is continuing to evaluate the need to purchase electric but with this purchase the dump trucks are still being evaluated based on the capability to have the range to drive throughout the City. In addition, City staff is still addressing the need for the infrastructure required for the charging stations to meet the demands for needed usage of these vehicles and equipment to ensure there is no delay in being able to use these electric vehicles. For the Forklift Variable Reach, electric is not yet available for this type of heavy equipment.

Modesto Municipal Code (MMC) Section 8-3.203 generally requires all purchases that meet or exceed $50,000 for material, equipment or contractual services to be formally bid. However, exceptions to the formal bidding process are granted in MMC 8-3.204(d) “Where the Purchasing Manager, in her discretion, determines that a process other than the formal bid procedure set for in Section 8-3.203 will result in a procurement for the City at the lowest possible cost commensurate with the desired quality.” In addition, MMC 8-3.202(h) encourages the Purchasing Manager to join with the State of California or other units of government in cooperative purchasing plans when the best cost savings interest of the City would be served.

By utilizing the Sourcewell, the City is complying with the requirements defined under this code for these Fleet vehicle purchases.

FISCAL IMPACT:

Sufficient funds for the twelve (12) Dump Trucks, two (2) Forklift Variable Reach and three (3) Packers are budgeted in Fiscal Year 23-24 in the Fleet Replacement Fund. The addition of the one (1) Dump Truck is budgeted in Fiscal Year 23-24 in the Surface Transportation Fund utilizing Gas Tax funds. Below is a summary of the overall cost for these vehicles purchases.

IFB No. Type of Fleet Amount
Proposed 15%
Change Order Overall Total
2324-06 Thirteen (13) Dump Trucks $ 2,803,943 $ 420,592 $ 3,224,535 2324-05 Two (2) Forklift Variable Reach $ 241,893 $ 36,284 $ 278,177 2324-04 Three (3) Packers $ 1,081,218 $ 54,061 $ 1,135,279 Grand Total $ 4,127,054 $ 510,937 $ 4,637,991
COMMITTEE RECOMMENDATION:

This item was presented at the October 25, 2021, Finance Committee to capture all City vehicle additions and replacements through Fiscal Year (FY) 2021-22 which included the six (6) Dump Trucks and two (2) Forklift Variable Reach. At the December 14, 2022, Finance Committee this item captured FY 2022-23 City vehicle additions and replacements which included the three (3) Packers and one (1) Dump Truck. The remaining six (6) Dump Trucks were presented as part of the FY 23-24 Finance Committee Budget Workshop on April 18, 2023.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving the Competitive Bidding Process from Sourcewell with PB Loader Corporation, Fresno, CA for thirteen (13) Dump Trucks for an amount not to exceed $2,803,943, authorizing the Purchasing Manager, or her designee, to issue the Purchase Order and execute any Change Orders not to exceed 15% of the total purchase price. #12..
- 335 -
City Council, August 22, 2023
Fleet Addition and Replacements – Dump Trucks, Forklift Variable Reach, and Packers

Resolution approving the Competitive Bidding Process from Sourcewell with Caterpillar Inc.

Peoria, IL under authorized dealer Holt of California, Stockton, CA to purchase two (2) Forklift Variable Reach for an amount not to exceed $241,893; authorizing the Purchasing Manager, or her designee, to issue the Purchase Order and execute any Change Orders not to exceed 15% of the total purchase price.

Resolution approving the Competitive Bidding Process from Sourcewell with Mack Trucks, Inc Greensboro, NC under the authorized dealer Western Truck Center, Sacramento, CA to purchase three (3) Packers for an amount not to exceed $1,081,218; authorizing the Purchasing Manager, or her designee, to issue the Purchase Order and execute any Change Orders not to exceed 15% of the total purchase price.

Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
Attachments:

1. Resolution (3)

2. Quote – PB Loader Corporation (Dump Trucks) and Cost Abstract

3. Quote – Holt of California (Forklift Variable Reach) and Cost Abstract

4. Quote – Western Truck Center (Packers) and Cost Abstract #12..
- 336 -
1 MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XX

RESOLUTION APPROVING THE COMPETITIVE BIDDING PROCESS FROM

SOURCEWELL WITH PB LOADER CORPORATION, FRESNO, CA FOR
THIRTEEN (13) DUMP TRUCKS FOR AN AMOUNT NOT TO EXCEED
$2,803,943, AUTHORIZING THE PURCHASING MANAGER, OR HER

DESIGNEE, TO ISSUE THE PURCHASE ORDER AND EXECUTE ANY
CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE
PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs); and WHEREAS, throughout the fiscal year, new vehicles need to be added to the City’s Fleet inventory due to the operational needs of City departments; when these vehicles are added to the fleet, they are also added to the Fleet Replacement list to prepare for future replacement; and
WHEREAS, on June 17, 2021, Sourcewell issued Request for Proposals (RFP) #0850521 under Contract #0850521-PBL for Roadway Maintenance Equipment on the Sourcewell Procurement Portal, New York State Contract Reporter, DJC Oregon, McClatchy and PublicPurchase.com; and
WHEREAS, on August 27, 2021, proposals were conducted electronically through the Sourcewell Procurement Portals; and
WHEREAS, thirty (30) proposals were received and based on the Sourcewell Proposal Review Committee and criteria outlined in the RFP, six (6) contracts were awarded for this commodity which includes the Dump Trucks; and WHEREAS, the use of Sourcewell contracts are cooperative agreements to streamline the procurement process by developing IFBs or RFP’s for national competitive solicitations that meet or exceed local requirements; and #12..
- 337 -
2 WHEREAS, Modesto Municipal Code Section 8-3.203 generally requires all purchases that meet or exceed $50,000 for material, equipment or contractual services to be formally bid. However, exceptions to the formal bidding process are granted in MMC 8-3.204(d) “Where the Purchasing Manager, in her discretion, determines that a process other than the formal bid procedure set for in Section 8-3.203 will result in a procurement for the City at the lowest possible cost commensurate with the desired quality”; and WHEREAS, MMC 8-3.202(h) encourages the Purchasing Manager to join with the State of California or other units of government in cooperative purchasing plans when the best cost savings interest of the City would be served.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the competitive bidding process from Sourcewell with PB Loader Corporation, Fresno, CA for thirteen (13) Dump Trucks for an amount not to exceed $2,803,943.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#12..
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3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _______________________________________
JOSE M. SANCHEZ, City Attorney
#12..
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1 MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XX

RESOLUTION APPROVING THE COMPETITIVE BIDDING PROCESS FROM SOURCEWELL WITH CATERPILLAR INC. PEORIA, IL UNDER

AUTHORIZED DEALER HOLT OF CALIFORNIA, STOCKTON, CA TO
PURCHASE TWO (2) FORKLIFT VARIABLE REACH FOR AN AMOUNT NOT TO EXCEED $241,893; AND AUTHORIZING THE PURCHASING MANAGER,

OR HER DESIGNEE, TO ISSUE THE PURCHASE ORDER AND TO EXECUTE ANY CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs); and WHEREAS, on January 31, 2019, Sourcewell issued Request for Proposals (RFP) #032119 under Contract #032119-CAT for New and Used Construction and Paving Equipment, Parts and Services and accessories on the Sourcewell Procurement Portal, New York State Contract Reporter website, the State Media Company, Utah Media Group, and PublicPurchase.com; and
WHEREAS, on March 22, 2019, proposals were conducted at the Sourcewell Procurement office in Staples, MN; and
WHEREAS, Fifteen (15) proposals were received and based on the Sourcewell Proposal Review Committee and criteria outlined in the RFP, nine (9) contract was awarded for this commodity which includes the two (2) Forklift Variable Reach; and WHEREAS, the use of Sourcewell contracts are cooperative agreements to streamline the procurement process by developing IFBs or RFP’s for national competitive solicitations that meet or exceed local requirements; and WHEREAS, Modesto Municipal Code Section 8-3.203 generally requires all purchases that meet or exceed $50,000 for material, equipment or contractual services to be formally bid. However, exceptions to the formal bidding process are granted in MMC #12..
- 340 -
2 8-3.204(d) “Where the Purchasing Manager, in her discretion, determines that a process other than the formal bid procedure set for in Section 8-3.203 will result in a procurement for the City at the lowest possible cost commensurate with the desired quality”; and WHEREAS, MMC 8-3.202(h) encourages the Purchasing Manager to join with the State of California or other units of government in cooperative purchasing plans when the best cost savings interest of the City would be served.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the competitive bidding process from Sourcewell with Caterpillar Inc. Peoria, IL under authorized dealer Holt of California, Stockton, CA to purchase two (2) Forklift Variable Reach for an amount not to exceed $241,893.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#12..
- 341 -
3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _______________________________________
JOSE M. SANCHEZ, City Attorney
#12..
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1 MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XX

RESOLUTION APPROVING THE COMPETITIVE BIDDING PROCESS FROM

SOURCEWELL WITH MACK TRUCKS, INC GREENSBORO, NC UNDER THE

AUTHORIZED DEALER WESTERN TRUCK CENTER, SACRAMENTO, CA
TO PURCHASE THREE (3) PACKERS FOR AN AMOUNT NOT TO EXCEED $1,081,218; AUTHORIZING THE PURCHASING MANAGER, OR HER

DESIGNEE, TO ISSUE THE PURCHASE ORDER AND EXECUTE ANY
CHANGE ORDERS NOT TO EXCEED 15% OF THE TOTAL PURCHASE
PRICE
WHEREAS, every year, City vehicles and equipment are individually evaluated based on their age, condition, mileage and maintenance costs); and WHEREAS, on June 9, 2020, Sourcewell issued Request for Proposals (RFP) #060920 under Contract #060920-MAK for Class 4-8 Chassis with Related Equipment, Accessories, and Services on the Sourcewell Procurement Portal, Utah Media Group, USA Today, South Carolina – The State, New York State Contract Reporter, Oregon Daily Journal of Commerce, and Public Purchase; and
WHEREAS, on July 21, 2020, proposals were conducted at the Sourcewell Procurement office in Staples, MN; and
WHEREAS, twenty-five (25) proposals were received and based on the Sourcewell Proposal Review Committee and criteria outlined in the RFP, nine (9) contracts were awarded for this commodity which includes the three (3) Packers; and WHEREAS, the use of Sourcewell contracts are cooperative agreements to streamline the procurement process by developing IFBs or RFP’s for national competitive solicitations that meet or exceed local requirements; and WHEREAS, Modesto Municipal Code Section 8-3.203 generally requires all purchases that meet or exceed $50,000 for material, equipment or contractual services to be formally bid. However, exceptions to the formal bidding process are granted in MMC #12..
- 343 -
2 8-3.204(d) “Where the Purchasing Manager, in her discretion, determines that a process other than the formal bid procedure set for in Section 8-3.203 will result in a procurement for the City at the lowest possible cost commensurate with the desired quality”; and WHEREAS, MMC 8-3.202(h) encourages the Purchasing Manager to join with the State of California or other units of government in cooperative purchasing plans when the best cost savings interest of the City would be served.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the competitive bidding process from Sourcewell with Mack Trucks, Inc Greensboro, NC under the authorized dealer Western Truck Center, Sacramento, CA to purchase three (3) Packers for an amount not to exceed $1,081,218.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to issue the Purchase Order.

BE IT FURTHER RESOLVED, that the Purchasing Manager, or her designee, is hereby authorized to execute any change orders not to exceed 15% of the total purchase price.
#12..
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3 The foregoing resolution was introduced in a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ________, who moved its adoption, which motion being duly seconded by Councilmember ______, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _______________________________________
JOSE M. SANCHEZ, City Attorney
#12..
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PB Loader Corporation
5778 W. Barstow • Fresno, California 93722-5024 • Telephone (559) 277-7370 • Fax (559) 277-7375 Toll free 800-350-8521 • Web www.pbloader.com

QUOTATION
DATE: 6/7/2023
CITY OF MODESTO TERMS: NET 30
MODESTO, CA F.O.B: SEE NOTES
SOURCEWELL MEMBER ID# 21208 MFG PRODUCT: SEE BELOW
INSTALL: SEE BELOW
QTY PART NO. DESCRIPTION PRICE EXTENSION
PB LOADER CONTRACT NO. 080521-PBL

SOURCEWELL CONTRACT - LISTED PRICES
15' TUB DUMP BODY & ACCESSORIES
1 PBLDB-10 $40,773.00
1 7661-00 $4,938.00
1 8200-00 $1,538.00
SUBTOTAL: $47,249.00
10% SOURCEWELL DISCOUNT: ($4,725.00)
3% ADDITIONAL DISCOUNT FOR MULTIPLE UNITS: ($1,701.00)

MARKET PRICE (NON-LISTED) BODY ACCESSORIES
1 $19,045.00

MARKET PRICE (NON-LISTED) CHASSIS
1 $138,238.00
SUBTOTAL: $198,106.00
SALES TAX (8.875%): $17,581.91
FREIGHT: $1,000.00
CALIFORNIA TIRE RECYCLE FEE: $17.50
TOTAL PRICE FOR ONE (1) UNIT): $215,687.91
TOTAL FOR THIRTEEN (13) UNITS: $2,803,942.80
NOTES:

Delivery times are approximate.
2024 FREIGHTLINER MODEL 114SD PLUS SET FORWARD AXLE CHASSIS WITH:
• FLAT ROOF ALUMINUM CONVENTIONAL CAB
• DETROIT
• ALLISON 4500 RDS AUTOMATIC TRANSMISSION WITH PTO PROVISION • D46-172 46,000# R-SERIES TANDEM REAR AXLE
• HENDRICKSON HAULMAAX EX 46,000# REAR SUSPENSION
• DETROIT DA-F-20.0-5 20,000# FL1 71.0 KPI/3.74 DROP SINGLE FRONT AXLE • 20,000# TAPERLEAF FRONT SUSPENSION
• 114 INCH BBC FLAT ROOF ALUMINUM CONVENTIONAL CAB
• 90 GALLON ALUMINUM FUEL TANK
• STEEL WHEELS
• CONTINENTAL HAU 3 WT 315/80R22.5 20 PLY RADIAL FRONT TIRES • CONTINENTAL HDR2+ 11R22.5 16 PLY RADIAL REAR TIRES
• 87 TO 112 DECIBEL AUTOMATIC SELF-ADJUSTING BACKUP ALARM • 2.5 LB. FIRE EXTINGUISHER
• CAB PAINTED FREIGHTLINER WHITE
NO. 11837

1. LEAD TIME FOR BODY PRODUCTION IS 120 DAYS, WITH AN ADDITIONAL 120-150 DAYS TO INSTALL AFTER RECIEPT OF CHASSIS AND BODY. LEAD TIME SUBJECT TO CHANGE AFTER RECEIPT TO ORDER.

2. FREIGHT IS FOR DEDICATED TRUCK SHIPMENT PER UNIT. PRICE IS VALID FOR 90 DAYS FROM DATE ABOVE.

3. SCALE DRAWING SUBMITTED TO THE CITY FOR APPROVAL PRIOR TO PRODUCTION.

4. WEIGHT SLIP OF COMPLETED UNIT PROVIDED AT TIME OF DELIVERY.

PB LOADER DUMP BODY, 15 FT 12-14 YARD, HPT53-130 CLASS 80 NTEA HOIST, 3/16" STEEL FLOOR AND TAILGATE, 10 GAUGE STEEL BALANCE, 38" SIDES, 54" FRONT AND 46" REAR, 12" SPREADER APRON, 1/4

CABSHIELD, LED LIGHTS, WIRING HARNESS & BACKUP ALARM, PUMP, CONTROLS, TANK, VALVE, MUD

FLAPS, STEEL MUDGUARDS, HOT SHIFT PTO, AIR TAILGATE, PAINT BLACK, INSTALLATION UPGRAGES TO ABOVE BODY INCLUDING:
• 44" SIDE HEIGHT (ILO 38") - 14 CUBIC YARD CAPACITY)
• 52" HIGH TAILGATE (ILO 46")
• AIR HIGH LIFT TAILGATE WTIH CONTROL IN CAB
• THREE (3) PULL-DOWN STYLE DITCH GATES IN TAILGATE - LH/CENTER/RIGHT • 3/4 CAB SHIELD (ILO 1/4)
• DURACLASS 63-130 SINGLE ACTING TELESCOPIC HOIST (ILO 53-130) WITH 40-TON CAPACITY • 8" SPREADER APRON (ILO 12" ABOVE)
• UHMW BED LINER - QUICKSILVER OR EQUAL
• SET OF 2" X 8" POLY SIDE BOARDS
• BED UP LED WARNING LIGHT WITH BUZZER
• SET OF MINIMIZER QUICK MUD FLAP BRACKETS
• PULL-OUT LADDER CURBSIDE WITH STEP AND GRAB HANDLES ABOVE • PULL-OUT LADDER STREETSIDE WITH STEP AND GRAB HANDLES ABOVE • BUYERS 18" X 18" X 30" ALUMINUM TOOLBOX W/ BARN DOOR, PAINTED BLACK • HOLLAND PH-210 AIR PINTLE HITCH - MOUNTED 26" FROM THROAT TO GROUND • SPRING STYLE CHASSIS GLAD HANDS TOP CORNERS OF HITCH PLATE • HOLLAND PH-210 AIR PINTLE HITCH
• TEKONSHA PRODIGY P2 ELECTRIC TRAILER BRAKE CONROLLER
• DOT-C2 2" RED/WHITE CONSPICUITY TAPE BOTH SIDES OF BODY FULL LENGTH, APPROXIMATELY MID HEIGHT
• BODY PAINTED WHITE, MATCHING CAB (ILO BLACK)
• WEIGHT SLIP OF COMPLETED UNIT
PULL TARP ELECTRIC (PULLTARPS SUPERSHIELD 9500E) - MESH MATERIAL W/ ROPE HOOKS EACH

SIDE OF BODY
HITCH PLATE W/ D-RINGS W/ TWO (2) 7 WIRE TRAILER SOCKETS (ONE FLAT PIN, RV STYLE, ONE ROUND PIN)
#12..
- 346 -
Aebi Schmidt North
America dba MͲB
Companies, Inc. Asphalt Zipper, Inc. Astec Industries
Bergkamp,
Incorporated BOMAG America, LLC
Bonnell Industries,
Inc.

Broce Manufacturing
Company, Inc. Cimline, Inc. Crafco, Inc.

Dynapac North
America, LLC (Fayat
North America, LLC) Etnyre International
Falcon Equipment
Holdings, LLC
Goldstar Asphalt
Products (NPG, Inc.)
Heat Design
Equipment, Inc.

Keizer Morris
International, Inc.

Possible Points
Conformance to RFPRequirements 50 43 40 41 41 40 39 37 40 41 40 40 43 37 35 41Pricing 400 345 318 315 323 322 339 306 341 334 311 316 285 264 270 340Financial Viability and Marketplace Success 75 65 60 64 64 61 62 58 63 63 66 62 62 55 49 66 Ability to Sell and DeliverService 100 83 74 82 75 78 78 76 82 84 83 75 78 63 63 81Marketing Plan 50 45 37 38 38 38 43 34 42 41 38 37 42 34 33 41Value Added Attributes 75 65 60 58 58 49 63 53 59 62 61 61 61 58 52 58Warranty 50 42 42 41 41 41 40 39 42 40 41 42 43 37 37 42Depth and Breadth of Offered Equipment,
Products, or Services 200 156 151 141 150 145 131 139 161 168 134 153 156 153 153 152 Total Points 1,000 844 782 780 790 774 795 742 830 833 774 786 770 701 692 821 Rank Order 2 16 17 11 18.5 8 22 4 3 18.5 13 20 26 27 6
Land Pride, A Division
of Great Plains Mfg.,
Inc.

Marathon
Equipment, Inc.

Pavement
Technologies
International Corp.

PB Loader
Corporation Road Groom Mfg, LLC RoadHog, Inc.

SB Manufacturing, Inc.
(Superior Broom) Skip-Line, LLC Spaulding Mfg, Inc.

Stepp Manufacturing
Company, Inc.

Striping Service and
Supply, Inc.

ThorWorks
Industries, Inc. dba
SealMaster, Inc.

Vogel Traffic Services,
Inc. dba EZ Liner
Warren Power
Attachments (Total
Patcher)
Waterblasting, LLC
(Hog Technologies)
Possible Points
Conformance to RFPRequirements 50 41 34 40 46 39 37 40 38 40 40 31 39 42 29 42Pricing 400 311 304 239 350 265 334 341 328 271 319 263 311 333 261 310Financial Viability and Marketplace Success 75 63 51 61 62 55 59 60 57 60 61 49 60 65 45 62 Ability to Sell and DeliverService 100 87 66 78 85 65 78 80 69 75 74 59 78 76 56 75Marketing Plan 50 42 34 43 44 35 37 38 37 38 41 29 40 43 28 38Value Added Attributes 75 61 51 63 65 55 58 59 54 62 55 43 55 65 41 55Warranty 50 40 38 42 43 41 39 39 39 41 42 32 38 42 37 41Depth and Breadth of Offered Equipment,
Products, or Services 200 139 151 163 158 119 151 143 135 146 162 120 166 158 134 161 Total Points 1,000 784 729 729 853 674 793 800 757 733 794 626 787 824 631 784 Rank Order 14.5 24.5 24.5 1 28 10 7 21 23 9 30 12 5 29 14.5 Greg Grunig, Procurement Lead Analyst Michael Muñoz, CPPB, Procurement Analyst Steff Haataja, CPIM, Procurement Analyst Carol Jackson, Procurement Analyst Proposal Evaluation
Road Maintenance Equipment RFP #080521










  



#12..
- 347 -
Quote 145904-02

July 26, 2023

CITY OF MODESTO
PO BOX 642
MODESTO CA 95353,
Account # 001125
Attention: DAVID BARR
(1) New Caterpillar Model: TL943 Tele Handler with all standard equipment in addition to the additional specifications listed below:

STOCK NUMBER: NEED TO ORDER SERIAL NUMBER: YEAR: SMU:

ADDITIONAL SPECIFICATIONS SOURCEWELL #032119-CAT
Reference # Description of Material and Equipment Reference # Description of Material and Equipment 601-9599 TL943 05A TELEHANDLER CFG1 484-6335 COUPLER, MANUAL, IT 0P-9003 LANE 3 ORDER 481-2710 ELECTRICAL HARNESS, HYD QC 559-9875 STEERING, SECONDARY 0P-3919 TL943 NORTH AMERICAN ORDER 606-6877 ENGINE 83 KW, HRC 483-7766 INSTRUCTIONS, ANSI
561-4268 RIDE CONTROL 602-4694 MANUAL, O&M, ENGLISH
609-8487 CLIMATE PACK,STD, DUAL BATTERY 566-6803 WORKLIGHTS,LED, A/C COMPATIBLE 607-6393 CAB, ENCLOSED, HEAT + A/C, HRC 566-6781 BEACON, LED STROBE 553-9349 WINDOW,REAR, EXT RELEASE, ANSI 474-9845 REVERSING, CAMERA 614-4002 BELT, SEAT, 3'' 500-4484 USB CHARGING POINT
479-4531 MONITOR, ADVANCED DISPLAY 501-3002 PRODUCT LINK, CELLULAR PL641 482-6420 LIGHTS,ROADING, RH, STABILIZER 472-0940 BRICK GUARD, ROOF 472-7832 LEVER, MANUAL, FNR/WIPERS/IND 481-9808 BOOM BRUSH 485-3311 ALARM, BACK-UP, STANDARD 607-6385 FRAME, STABILIZER, NONE 477-1403 SUN SCREEN, ROOF 603-4892 LOAD CHART, ANSI, STANDARD 480-9194 SENSOR, BOOM ANGLE, STD 301-9758 CARRIAGE, STANDARD 72'' 464-8004 TIRES, 14.00-24, FS, G2, FOAM 301-9755 FORK, PALLET 2.36'' X 4'' X 48'' 485-2360 FENDERS, SINGLE

WARRANTY INFORMATION
Standard Warranty: 12 Months or Unlimited hours
CSA Dry Filters Parts Kit - 24 Months or 1000 Hours
List Sell Price $283,477.70
Source Well Discount off list 24% $-68,034.64
Machine Price after discount $215,443.06
Delivery, Ein Decals, Freight, Fuel, Machine Prep, Manuals $6,731.77 Net Balance due $222,174.83
Sales Tax (8.875%) $19,718.02
CSA Included
After Tax Balance $241,892.85
#12..
- 348 -
Quote 145904-02

F.O.B/TERMS: EMD - STOCKTON

STANDARD EQUIPMENT
BOOMS, STICKS, AND LINKAGES -Three section boom -with non-metallic wear pads -Automatic parallel lift - POWERTRAIN -4 Speed Powershift Transmission -Pulley driven fan -Radiator Cores -Side by side engine air -Engine oil -Hydraulic oil and coolant -Water separator -Dual element air filter -Spin on engine oil filter -Spin on Hydraulic oil filter -Planetary drive axles with full time -four wheel drive -Limited slip differential -Wet disc service brakes -Spring Applied Hydraulic Release (SAHR) -park brake w/indicator light -Thermal starting aid -
HYDRAULICS -Variable Displacement Piston Pump -- Max Auxiliary Flow: 25gpm -- System Operating Pressure: 260 bar -- Auxiliary Operating Pressure: 240 bar -Load hold check valves on all load -carrying cylinders -Auxiliary hydraulic service on the -boom head - single function -CAT XT3 hoses, couplings -
ELECTRICAL -12 volt electrical socket -75 ampere alternator -1000 CCA maintenance-free battery -Horn OPERATOR ENVIRONMENT -ROPS and FOPS certified operator station -isolated on rubber mounts -Boom joystick -Frame level switch -Fully adjustable vinyl suspension seat -Seat belt & document pouch -Left & right-side rear-view mirror -Power steering with steering wheel -Load charts -Heavy duty floor mat -Fuse panel - OTHER STANDARD EQUIPMENT -Integral lift and tie-down points - INSTRUCTIONS -Operation and maintenance manual -
This quote is good for (30) days. Any machine quoted outside of HOLT of CALIFORNIA's inventory is subject to revision All quotes are subject to credit approval and prior sale. Any quoted interest rates are subject to change without notice. Quote is void unless machine is delivered, and remains, within HOLT of CALIFORNIA's Dealership territory for two years or unless the machine has at least 1000 hours if delivered outside of Holt's territory.

THE ADDITIONAL TERMS AND CONDITIONS ON THE REVERSE SIDE ARE PART OF AND INCORPRORATED IN THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSIDERED ENFORCEABLE UNTIL ACCEPTED BY HOLT AND EXECUTED BY ITS OFFICE. ANY INDIVIDUAL SIGNING THIS AGREEMENT REPRESENTS AND WARRANTES THAT HE/SHE IS AT LEAST 18 YEARS OLD AND HAS THE AUTHORITY TO BIND CUSTOMER TO THE TERMS OF THE AGREEMENT.

Accepted by DS_CustPrintName Date, ds-dt1
__________________________________ ___________________
(Please Print)
Signature CustomerSign
__________________________________________________

Sincerely,
Jason Hjelmstad
Territory Manager
Earth Moving Division
Holt of California
[email protected]
Cell 209-321-2831
#12..
- 349 -
RFP # 032119
BOMAG Americas, Inc. Caterpillar Inc. CNH Industrial America LLC Doosan Infracore North
America, LLC Dynapac North America LLC
Grove U.S. L.L.C. (dba
Manitowoc)
Hyundai Construction
Equipment Americas, Inc.

Possible Points
Conformance to Terms/ Conditions to Include Documentation 50 40 46 44 37 34 41 40 Pricing 400 352 359 321 313 346 347 353
Financial, Industry and Marketplace Successes 75 64 70 68 61 60 66 59 Bidder's Ability to Sell/ Service Contract Nationally 100 82 92 89 78 83 84 79 Bidder's Marketing Plan 50 37 44 44 38 39 42 39
Value Added Attributes 75 56 70 66 56 62 60 65
Warranty Coverages and Information 50 42 45 44 39 39 41 46 Selection and Variety of Products and Services Offered 200 159 186 176 156 154 159 168 Total Points 1000 832 912 852 778 817 840 849Rank Order 8 1 512 1076 John Deere Construction
Retail Sales
Kobelco Construction
Machinery USA, Inc. Komatsu America Corp. Link Belt Cranes Roadtec, Inc Volvo Construction Equipment
North America, LLC Wirtgen America, Inc.

Possible Points
Conformance to Terms/ Conditions to Include Documentation 50 42 37 43 34 41 43 41 Pricing 400 344 264 345 342 313 337 320
Financial, Industry and Marketplace Successes 75 66 52 63 66 60 68 64 Bidder's Ability to Sell/ Service Contract Nationally 100 91 74 90 82 72 91 84 Bidder's Marketing Plan 50 41 46 44 40 36 45 38
Value Added Attributes 75 67 62 67 65 59 70 63
Warranty Coverages and Information 50 43 42 44 42 36 44 40 Selection and Variety of Products and Services Offered 200 181 151 177 160 156 180 157Total Points 1000 875 728 873 831 773 878 807 Rank Order 314 4 913 211
________________________________________ _________________________ __________________________ James Voelker, CPCM, CFCM, Sourcewell Greg Grunig, Sourcewell           Carol Jackson, Sourcewell ______________________________________ ________________________ Michael Munoz, Sourcewell Craig West, Sourcewell
Form G
HEAVY CONSTRUCTION EQUIPMENT WITH RELATED ACCESSORIES, ATTACHMENTS, AND SUPPLIES DocuSign Envelope ID: BF761C4D-7D5B-4B3C-947E-209599537EE6 #12..
- 350 -
Date : Purchaser :

Seller :
$GGUHVV:

CUSTOMER PURCHASE ORDER
Address :

City/State/ZIP :

Phone/Contact :

I hereby order from you, subject to all terms and conditions contained herein and the ADDITIONAL PROVISIONS printed on the last Page of this form, the following equipment for delivery on or about :

PURCHASER ACKNOWLEDGES RECEIPT OF AN EXACT COPY OF THIS ORDER, and the additional provisions printed on the last page.

Customer Acceptance Date WPI Manager Acceptance Date
This order is subject to written acceptance of the Seller by a manager as indicated below. Purchaser's deposit will be refunded if not accepted, otherwise, deposit is nonrefundable.

If the unpaid balance of cash price stated above is the proceeds of a time payment agreement as noted below, all items and conditions of that agreement are hereto made part of and an attachment to this order by this reference.

USED VEHICLES ARE SOLD "AS IS" WITH NO WARRANTY, unless otherwise certified by Seller in Writing.

If a trade-in is delivered to Dealer in a different condition than appraised, or its parts or attachments have been removed or substituted, then it shall be reappraised, and the difference in value shall be paid in cash to Dealer. Purchaser warrants that ownership, and titles of trade-ins are free and clear or all liens and encumbrances except as noted aand will pay in cash to Dealer any undisclosed amounts owed. If any such cash adjustment is not paid on demand, purchaser authorizes Dealer to repossess the vehicle.
City|State|Zip:

Stock#: 3 2024 Mack LR64R Price: $330,428.00
VIN: SACR2022000447P76 Engine Serial: 75095603
PDI and delivery $475.00
DOC Fee: $85.00 Title Fee: $25.00
Tire Tax: $17.50 Total fees: $127.50
Sales Tax: $29,375.18
Unit Price: $360,405.68
____________________________________________________________________________________________________________ Total Price $330,903.00
Total Fees $127.50
Total FET $0.00
Total Licensing $0.00
Tax Rate: 8.8750%, County Code: Sales Tax $29,375.18
Total $360,405.68
TOTAL DUE: $360,405.68
2024 Mack LR with Heil DP 5000 rear loader with weight scales Mack Sourcwell Contract 060920-MAK
Heil Sourcewell Contract 091219-THC
Build date is subject to CARB regulation

#12..
- 351 -

ADDITIONAL PROVISIONS
(Purchaser)
(Purchaser)

1. As used in this Order the terms (a) "Seller" shall mean the Dealer to whom this Order is addressed and who shall become a party thereto by its acceptance hereof, (b) "Purchaser" shall mean the party executing this Order as such on the face hereof, it being understood by Purchaser and Seller that Seller is in no respect the agent of manufacture, that Seller and Purchaser are the sole parties to this order.

2. Upon full payment by or delivery to Purchaser said property shall be held and used at his risk, including expenses, loss or damage, taxes, and liabilities of any kind.

3. Purchaser agrees to complete payment and accept delivery within 72 hours after notification that said property is ready. If purchaser fails to make settlement as herein provided, seller may retain all moneys or property paid on account as liquidated damages, not to exceed the greater of: 1) actual costs incurred; 2) $2,500; 3) or 35% of purchase price. Trade-in property shall be accounted for at the price resold, less 15% and all reconditioning handling and selling costs.

4. Purchaser agrees not to demand or expect any equipment, parts, supplies, labor service, or rebate, unless agreed to and specified in this agreement in writing.

5. Purchaser warrants the vehicle being purchased herein is to be used for business purposes only and is not to be normally used for personal, household, or family purposes.

6. Dealer shall not be liable for failure to deliver or delay in delivery due, in whole or in part, to any cause beyond the control or without the fault or negligence of Dealer.

7. Purchaser agrees to reimburse Dealer for any and all sales, use or excise taxes imposed by law relative to the goods herein provided.

8. Purchaser agrees to accept factory ordered goods with any changes in design or materials made by the manufacturer.

9. Prices quoted for factory orders are subject to the manufacturer's price list, and in the event of a price increase Purchaser agrees to provide written notice of cancellation within five (5) days of being so advised, or accept delivery at the increased price.

THIS MOTOR VEHICLE IS SOLD BY THE SELLER AND
PURCHASED BY PURCHASER "AS IS" WITHOUT ANY
WARRANTY, EITHER EXPRESSED OR IMPLIED. THE

PURCHASER WILL BEAR THE ENTIRE EXPENSE OF

REPAIRING OR CORRECTING ANY DEFECTS THAT

PRESENTLY EXIST OR THAT MAY OCCUR IN THIS
VEHICLE.

The seller does not in any way warrant the fitness of the motor vehicle for any particular use or the merchantability of the motor vehicle purchased under this contract. Whether the motor vehicle is purchased for commercial or for personal family or household use, purchaser, understands and agrees that the Seller makes no warranty whatsoever, expressed or implied, respecting the quality, characteristics, performance or condition of the motor vehicle, or DQ\ of its component parts.

The Seller makes no warranty whatsoever, expressed or
implied, concerning the length of time or mileage which the purchased motor vehicle will operate or travel after the date of purchase.

Purchaser expressly agrees that it is his sole responsibility to place the item(s) in a serviceable condition, to determine its safety and suitability and to determine its compliance with applicable laws and statutes.

Purchaser further agrees that the seller shall have no liability for consequential damages in the event of injury to any persons or property, or any liability for loss of use, loss of time, loss of profits or income, or any other incidental expenses arising from malfunction or defect or unfitness or deficiency

DISCLAIMER OF WARRANTY AGREEMENT NEW VEHICLE WARRANTY
The only warranty applying to this vehicle are
those offered by the manufacture. The selling
dealer hereby expressly disclaims all
warranties. either express or implied, including
any implied warranties of merchantability or
fitness for a particular purpose and neither
assumes nor authorizes any other person to
assume for it any liability connection with the
sale of this vehicle. Buyer shall not be entitled
to recover from the selling dealer any
consequential damages, damages to property,
damages for loss of use, loss of time, loss of
profits or income, or any other incidental
damages.

#12..
- 352 -
RFP # 060920
72 Hour, LLC Adomani, Inc. Amthor International Autocar Truck, LLC Boyer Ford Trucks, Inc. BYD Motors, LLC Certified Stainless Service, Inc. Chas S Winner, Inc. Crane Carrier Company Daimler Trucks North America Don Brown Bus Sales Eco Vehicle Systems Federal Contracts Corp.

Possible Points
Conformance to Terms/
Conditions to IncludeDocumentation 50 44 36 33 42 41 42 43 33 41 40 35 37 40 Pricing 400 358 335 158 355 321 309 345 175 334 295 284 339 206 Financial, Industry and
Marketplace Successes 75 68 54 55 62 57 62 63 51 61 62 57 54 60 Bidder's Ability to Sell/ ServiceContract Nationally 100 88 60 51 88 71 69 71 52 80 87 67 61 74 Bidder's Marketing Plan 50 46 36 41 42 41 40 45 24 41 39 40 38 40 Value Added Attributes 75 64 49 52 64 52 69 63 28 63 61 60 61 66 Warranty Coverages andInformation 50 42 41 34 44 40 41 41 25 40 43 39 41 40 Selection and Variety of
Products and Services Offered 200 187 140 93 150 165 140 169 115 161 156 126 155 109 Total Points 1,000 897 751 517 847 788 772 840 503 821 783 708 786 635 Rank Order 1.5 19 23 5 14 17 7 24 9 16 20 15 21
Hino Motors Sales USA Industrial Power, LLC Kenworth Truck Company Lion Buses, Inc. Los Angeles Truck Centers Mack Trucks Navistar Peterbilt Motors Company Phoenix Cars, LLC Redhead Equipment Structural Metal Fabricators Volvo Trucks North America Possible Points
Conformance to Terms/ Conditions to Include Documentation 50 39 41 44 42 42 44 45 45 40 31 30 31 Pricing 400 334 342 358 341 321 335 338 360 313 135 224 320Financial, Industry and Marketplace Successes 75 56 54 67 59 62 67 69 69 57 47 50 65Bidder's Ability to Sell/ Service Contract Nationally 100 79 65 92 83 59 88 94 93 71 36 64 86Bidder's Marketing Plan 50 33 38 43 39 41 40 43 45 40 19 28 43Value Added Attributes 75 55 54 66 66 60 67 68 71 61 40 46 65Warranty Coverages and Information 50 43 39 42 45 42 44 44 43 41 27 34 43Selection and Variety of Products and Services Offered 200 165 167 170 151 169 161 174 171 129 91 110 139Total Points 1,000 804 800 882 826 796 846 875 897 752 426 586 792Rank Order 10 11 3 812 6 41.5 18 25 22 13 ________________________________________ _____________________________________ Greg Grunig, Procurement Lead Analyst Carol Jackson, Procurement Analyst __________________________________________________ _________________________________ Brandon Town, CPSM, CPSD, Procurement Analyst Craig West, Procurement Analyst Proposal Evaluation
Class 4Ͳ8 Chassis with Related Equipment, Accessories, and Services 















#12..
- 353 -

CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

August 22, 2023
Date: July 27, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: Christina Alger, Director of Human Resources
SUBJECT: Modesto Firefighters’ Association Side Letter Agreements CONTACT: Christina Alger, Director of Human Resources
[email protected], 209-571-5126
DESCRIPTION:

Consider approving a Side Letter Agreement with Modesto Firefighter’ Association for two additional holidays and a Side Letter Agreement for an adjustment to compensation for a special assignment. (Funding Source: General Fund)
STRATEGIC PLAN ELEMENT:

This item supports the 2020-2025 Strategic Plan’s Service and Delivery Goals & Strategies - Building a High-Performing Organization by Attracting and Retaining High Performance Employees.

BACKGROUND:

Holidays
Prior to July 1, 2023, the City provided all employees a total of ten holidays and one floating holiday. Holidays included consisted of New Year’s Day, Dr. Martin Luther King Jr. Day, Presidents’ Day, Memorial Day, Independence Day, Labor Day, Veterans’ Day, Thanksgiving Day, Day after Thanksgiving, and Christmas Day, with the floating holiday recognizing Admission Day. Consistent with past practice, holidays that are negotiated with other bargaining units, are provided to employees citywide.

Special Assignment Pay
Under Article 8 – Special Assignments, employees may be assigned by the Fire Chief to serve in long-term 40-hour assignments such as assignments within Fire Investigations and the Training Division. Associated with these special assignments, employees are provided with a special assignment pay equivalent Step C of the Captain position allocation salary schedule or seven and one-half percent above their base pay, whichever is greater. This had been in effect since October 23, 2001. This also applies to those assigned to a 56-hour work schedule performing Fire Investigation duties.
#13..
- 354 -
Council Agenda Report
Modesto Firefighters’ Association Side Letter Agreements

DISCUSSION:

Holidays
The City negotiated with four of the City’s five bargaining units with the new contracts becoming effective July 1, 2023. Tentative agreements were approved by Council on June 13, 2023, by Resolution No. 2023-285, 2023-284, 2023-286 respectively for Modesto Confidential and Management Association (MCMA), Modesto City Employees’ Association (MCEA), and Modesto Police and Fire Non-Sworn Association (MPNSA), and June 27, 2023, by Resolution No. 2023-320 for Modesto Police Officers’ Association (MPOA).

As with past practice, the City has provided holidays that are negotiated to all employees regardless of the membership, or lack of, in the negotiated union. Modesto Firefighters’ Association (MCFFA) was the only union contract that was not expiring and being negotiated in the current year. The parties agree to add the two additional holidays, Cesar Chavez Day and Juneteenth, to their list of holidays recognized by the City.

Special Assignment
The City and Modesto Firefighters’ Association (MCFFA) met in good faith to agree on a new Memorandum of Understanding (MOU) in the spring of 2022. The prior MOU was set to expire June 30, 2022. The City and MCFFA came to a tentative agreement which was approved by Council on June 7, 2022, by Resolution No. 2022-266 with an effective date of July 1, 2022.

One of the agreed upon terms was the addition of a step in the salary schedule. Prior to the agreement, the salary schedules consisted of five steps. Steps would increase to six, beginning July 1, 2023. With the addition of a step to the salary system, employees in the Firefighter and Fire Engineer have an additional five percent to reach the top. This creates a smaller difference between these salary schedules and that of the Fire Captain. Employees who are assigned to the special assignment do not realize the same increase in pay to account for the increase in responsibility. Adjusting the special assignment pay to be placed at Step D rather than Step C will correct the misalignment and provide the equivalent increase that was provided prior to the sixth step being added to the salary schedule.

FISCAL IMPACT:

There is no fiscal impact to adjusting the special assignment step. Employees will receive the same percentage increase as was established under the previous five step salary schedule.

The fiscal impact of adding the holidays include the ability to cash out holiday time not being taken as days off. The average amount of annual cash out per holiday for MCFFA unit employees is $66,857. The cost will be absorbed into the Fiscal Year 2023-24 Operating Budget.

COMMITTEE RECOMMENDATION:

This item was presented not presented to a committee.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving an Agreement with the Modesto Firefighters’ Association to add Cesar Chavez and Juneteenth to the recognized City holidays effective July 1, 2023 and authorizing the City Manager or his designee to take the necessary administrative action to implement the Agreement.
#13..
- 355 -
Council Agenda Report
Modesto Firefighters’ Association Side Letter Agreements

Resolution approving an Agreement with the Modesto Firefighter’s Association to adjust special assignment compensation effective July 1, 2023 and authorizing the City Manager or his designee to take the necessary administrative action to implement the Agreement.

Christina Alger, Director of Human Resources
Joseph P. Lopez, City Manager
Attachments:

1. Resolutions

2. Side Letter Agreements
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08/08/2023/HR/CAlger/Item XX 1 2023-XX

MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XXX

RESOLUTION APPROVING AN AGREEMENT WITH THE MODESTO
FIREFIGHTERS’ ASSOCIATION TO ADD CESAR CHAVEZ AND

JUNETEENTH TO THE RECOGNIZED CITY HOLIDAYS EFFECTIVE JULY 1, 2023, AND AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO

TAKE THE NECESSARY ADMINISTRAVE ACTION TO IMPLEMENT THE

AGREEMENT
WHEREAS, prior to July 1, 2023, the City provided all employees a total of ten holidays and one floating holiday, and
WHERAS, holidays included New Year’s Day, Dr. Martin Luther King Jr. Day, Presidents’ Day, Memorial Day, Independence Day, Labor Day, Veterans’ Day, Thanksgiving Day, Day after Thanksgiving, and Christmas Day, with the floating holiday recognizing Admission Day, and
WHEREAS, the City negotiated with four of the City’s five bargaining units with the new contracts becoming effective July 1, 2023, by Resolution No. 2023-285, 2023- 284, 2023-286, and
WHEREAS, as with past practice, the City has provided holidays that are negotiated to all employees regardless of the membership, or lack of, in the negotiated union, and
WHEREAS, Modesto Firefighters’ Association (MCFFA) was the only union contract that was not expiring and being negotiated in the current year, and WHEREAS, the parties agree to add the two additional holidays to their list of holidays recognized by the City.
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08/08/2023/HR/CAlger/Item XX 2 2023-XX
NOW, THEREFORE, BE IT HEREBY RESOLVED by the Council of the City of Modesto that it hereby approves an agreement with the Modesto Firefighters’ Association to add Cesar Chavez and Juneteenth to the recognized holidays effective July 1, 2023.

BE IT FURTHER RESOLVED that the City Manager, or his designee are hereby authorized to execute the agreement, in a form approved by the City Attorney.

The foregoing resolution was adopted at a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers: ?
NOES: Councilmembers: ?
ABSENT: Councilmembers: ?
ATTEST: _____________________________

DIANE NAYARES-PEREZ, CMC,
City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ________________________________
JOSE M. SANCHEZ, City Attorney
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08/22/2023/HR/CAlger/Item XX 1 2023-XX

MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XXX

RESOLUTION APPROVING AN AGREEMENT WITH THE MODESTO
FIREFIGHTERS’ ASSOCIATION TO ADJUST SPECIAL ASSIGNMENT
COMPENSATION EFFECTIVE JULY 1, 2023, AND AUTHORIZING THE CITY

MANAGER OR HIS DESIGNEE TO TAKE THE NECESSARY

ADMINISTRATIVE ACTION TO IMPLEMENT THE AGREEMENT
WHEREAS, Under Article 8 – Special Assignments, employees may be assigned by the Fire Chief to serve in long-term 40-hour assignments such as assignments within Fire Investigations and the Training Division. Associated with these special assignments, employees are provided with a special assignment pay equivalent Step C of the Captain position allocation salary schedule or seven and one-half percent above their base pay, whichever is greater, and
WHEREAS, this also applies to those assigned to a 56-hour work schedule performing Fire Investigation duties, and
WHEREAS, the City and Modesto Firefighters’ Association (MCFFA) met in good faith to agree on a new Memorandum of Understanding (MOU) in the spring of 2022. The prior MOU was set to expire June 30, 2022. The City and MCFFA came to a tentative agreement which was approved by Council on June 7, 2022, by Resolution No. 2022-266 with an effective date of July 1, 2022, and
WHEREAS, one of the agreed upon terms was the addition of a step in the salary schedule, and
WHEREAS, this creates a smaller difference between the salary schedules of Firefighter and Fire Engineer and that of the Fire Captain, and WHEREAS, employees who are assigned to the special assignment do not realize the same increase in pay to account for the increase in responsibility. #13..
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08/22/2023/HR/CAlger/Item XX 2 2023-XX
NOW, THEREFORE, BE IT HEREBY RESOLVED by the Council of the City of Modesto that it hereby approves an agreement with the Modesto Firefighters’ Association to adjust the special pay compensation from Step C to Step D effective July 1, 2023.

BE IT FURTHER RESOLVED, that the City Manager, or his designee is hereby authorized to execute the agreement, in a form approved by the City Attorney.

The foregoing resolution was adopted at a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers: ?
NOES: Councilmembers: ?
ABSENT: Councilmembers: ?
ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City
Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ________________________________
JOSE M. SANCHEZ, City Attorney
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

August 22, 2023
Date: July 28, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: Bill Sandhu, Public Works Director
SUBJECT: Authorize the Submittal of California Governor’s Office of Planning and Research Grants
CONTACT: Rosene Nguyen, Integrated Waste Program Manager, [email protected], 209-577-5453
DESCRIPTION:

Consider authorizing the Submittal of Application(s) to the State of California Governor’s Office of Planning and Research Grants. (Funding Source: Not Applicable).

STRATEGIC PLAN ELEMENT:

The recommended action is consistent with the Council’s Strategic Plan Area (2020-2025) - Quality of Life: “Engage partners across the community to ensure the safety, resilience, and attractiveness of Modesto;” Goal D: “Provide safe, efficient, and reliable infrastructure through proactive community investment, maintenance, and sustainability efforts.” BACKGROUND:

The State of California Governor’s Office of Planning and Research (OPR) studies future research and planning needs, fosters goal-driven collaboration, and delivers guidance to state partners and local communities, with a focus on land use and community development, climate risk and resistance, and high road economic development.1 To support local communities in developing local adaptation plans to climate resilience, OPR supports program grants that fund planning and implementation projects, partnerships, and efforts within regional climate resilience.

DISCUSSION:

The State of California launched the Integrated Climate Adaptation and Resiliency Program (ICARP) in 1994 to advance equitable, integrated climate adaptation and resilience solutions across local, regional, and state efforts.2 In the 2021 state budget, ICARP expanded its direct 1 https://opr.ca.gov/
2 https://opr.ca.gov/climate/icarp/#about-icarp
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City Council, August 22, 2023
Authorize the Submittal of California Governor’s Office of Planning and Research Grants

support programs to provide three grant opportunities related to adaptation planning, regional resilience, and extreme heat impacts.3
The City of Modesto pursues funding opportunities in the form of state or federal direct funding where possible that are consistent with identified City Strategic Commitments. Modesto is a central California city, susceptible to drought conditions, extreme heat events, and other negative impacts from climate change. As such, City staff encourages pursuit of grants through OPR that will assist Modesto in proactively achieving climate resilience and supporting its residents through climate change adaptation.

FISCAL IMPACT:

Applying for this OPR grant does not commit the City to a financial obligation or to accepting the grant, if awarded. This item is administrative in nature and has no fiscal impact.

COMMITTEE RECOMMENDATION:

This project was presented to the Economic Development Committee on August 7, 2023, and the Committee recommended forwarding this item to Council for approval.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution authorizing the Submittal of Application(s) to the State of California Governor’s Office of Planning and Research Grants, and authorizing the City Manager, or his designee, to sign grant applications and related documents.

Approved by:

Bill Sandhu, Public Works Director
Joseph P. Lopez, City Manager
Attachment:

1. Resolution
3 https://opr.ca.gov/climate/icarp/grants/
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\ -1-

MODESTO CITY COUNCIL
RESOLUTION NO. 2023-

RESOLUTION AUTHORIZING THE SUBMITTAL OF APPLICATION(S) TO THE STATE OF CALIFORNIA GOVERNOR’S OFFICE OF PLANNING AND

RESEARCH GRANTS, AND AUTHORIZING THE CITY MANAGER, OR HIS

DESIGNEE, TO SIGN GRANT APPLICATIONS AND RELATED DOCUMENTS WHEREAS, the State of California Governor’s Office of Planning and Research (OPR) studies future research and planning needs, fosters goal-driven collaboration, and delivers guidance to state partners and local communities, with a focus on land use and community development, climate risk and resistance, and high road economic development; and
WHEREAS, the State of California launched the Integrated Climate Adaptation and Resiliency Program (ICARP) in 1994 to advance equitable, integrated climate adaptation and resilience solutions across local, regional, and state efforts; and WHEREAS, in the 2021 state budget, ICARP expanded its direct support programs to provide three grant opportunities related to adaptation planning, regional resilience, and extreme heat impacts; and
WHEREAS, Modesto is a central California city, susceptible to drought conditions, extreme heat events, and other negative impacts from climate change; and WHEREAS, the City of Modesto benefits from EPA grant programs by receiving funding for the purchase of equipment or materials related to infrastructure, direct operating expenses, education and outreach opportunities, and various other expenses related to promoting recycling and materials recovery and decreasing contamination in source-separated recycling.
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NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby authorizes staff to apply for the State of California Governor’s Office of Planning and Research grants.

BE IT FURTHER RESOLVED, that the City Manager, or his designee, is authorized to sign grant applications and related documents.

The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 22nd day of August, 2023, by Councilmember? who moved its adoption, which motion being duly seconded by Councilmember? was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: __________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: _______________________________
JOSE M. SANCHEZ, City Attorney
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

August 22, 2023
August 02, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: William Wong, Director of Utilities
SUBJECT: Award Rebid La Loma Sewer Replacement Phase 1 Project CONTACT: Cristian Ciotau, Senior Civil Engineer, [email protected], 209-577-5260 DESCRIPTION:

Consider accepting the Plans and Specifications for the Rebid La Loma Sewer Replacement Phase 1 Project and Awarding a Construction Contract to Mozingo Construction Inc, of Oakdale, CA, in the amount of $5,282,147 plus $792,322 in Contingency (if needed), for a total amount not to exceed $6,074,469. (Funding Source: Wastewater Fund) STRATEGIC PLAN ELEMENT:

The recommended action supports the 2020-2025 City of Modesto Strategic Plan Initiatives, Goal D: Provide safe, efficient, and reliable infrastructure through proactive community investment, maintenance, and sustainability efforts.

BACKGROUND:

In 2016, the Wastewater Engineer’s Report was approved to provide a basis for establishing wastewater related charges, fees and identified needed Wastewater Capital Improvement Program (CIP) Projects.

In 2021, the updated Wastewater Engineer’s Report included the rehabilitation of the existing sewer lines in the La Loma Avenue area. Phase 1, identified as project “LL-1”, in Area 4 of the La Loma Sewer Project is bounded by Downey Avenue to the North, North Morton Boulevard to the East, Jennie Street to the South and Burney Street to the West.

In the La Loma Phase 1 Area, there are old, deficient sewer lines which are undersized and, in some areas, do not meet the self-cleaning velocity as specified in the City Standard Specifications of a minimum 2 feet per second. This project will upsize approximately 7,400 linear feet of sewer lines and will address the existing slope issues, bringing it in compliance with current City standards.
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City Council, August 22, 2023
Award Rebid La Loma Sewer Replacement Phase 1 Project

In addition to the gravity lines, new laterals will also be installed in various locations throughout the neighborhood along with a 6-inch sewer force main to reroute and replace the existing old line. As a result of the new alignments, new manholes will also be installed.

This project will also construct new concrete ramps and provide for street paving where needed.

DISCUSSION:

The project was initially advertised for bids on March 7, 2023. The bids were publicly opened on April 11, 2023, pursuant to City Charter Section 1307; Two bids were received.

One bid was below the engineer’s estimate by 15% and the other bid was 18.17% higher than the engineer’s estimate. There was a substantial discrepancy between the two bids and the bid participation was not as expected with only two bids received.

For these reasons, staff recommended the rejection of the bids received and re-advertising the project at a different date. This allowed staff to re-evaluate the construction costs in accordance with the scope of work and to perform any adjustments to the bid package as well as to the engineer’s estimate and project budget.

On May 23, 2023, by Resolution 2023-239, Council approved rejecting all bids for the La Loma Sewer Replacement Phase 1 Project and authorizing staff to re-advertise the project for bids at a future date.

The Rebid La Loma Sewer Replacement Phase 1 Project was re-advertised for bids on June 6, 2023. Bids were publicly opened on July 11, 2023, pursuant to City Charter Section 1307.

Following review of the bid packages, Mozingo Construction Inc, of Oakdale, CA, was the responsible bidder with the lowest responsive bid. The bid tabulation is attached.

The bid analysis is:

Number of bids received 2
Number of bids within 10% of engineer’s estimate 1
Number of bids above the engineer’s estimate 0
Number of bids below the engineer’s estimate 2
Percent of lowest responsive bid below the engineer’s estimate 10.40% The lowest responsive bid provided by Mozingo Construction Inc, of Oakdale, CA is 10.40% below the engineer’s estimate. The next bid was 9.71% below the engineer’s estimate. Bidder participation was good as the City received two bids.

Modesto Municipal Code Section 8-3.203 generally requires all purchases, which meet or exceed $50,000 for material, equipment, or contractual services to be formally bid. The award of contract for the construction of the Rebid La Loma Sewer Replacement Phase 1 Project to Mozingo Construction Inc, of Oakdale, CA, conforms to the Modesto Municipal Code, 8-3.203.

In addition, the City’s “Change Order Approval Policy”, enacted by Council Resolution No. 94- 443 on July 19, 1994, was updated by Resolution No. 2019-326 on July 9, 2019, establishing a #15..
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City Council, August 22, 2023
Award Rebid La Loma Sewer Replacement Phase 1 Project

contract change order authority of 8% for construction contracts of this dollar value. However, given the nature of this project dealing with aged infrastructure and facilities, additional work may be needed to address unexpected conditions that require changes in the project scope that may exceed the Director’s Authority of 8% ($422,572) of the contract amount of $5,282,147.

Staff is requesting authorization to increase the contract change order budget to 15% ($792,322) due to unknown challenges.

While the contingency policy is utilized for each construction contract awarded by the City, it is not written into each contract, nor is it a guaranteed amount included in the final compensation to the contractor. Prior to bidding a project, staff works diligently to ensure that all projects and bid packages contain well-defined scopes of work and that all projects stay within budget.

FISCAL IMPACT:

Total estimated cost for the construction phase of this project is $6,842,684, expenses associated with this effort are housed in the following project:
100916 – La Loma Sewer
ANTICIPATED CONSTRUCTION EXPENDITURES:

Construction Contract $5,282,147
Construction Contingency (15%) $792,322
Construction Administration - City Staff $528,215
Engineering/Design/Administration - City Staff $240,000 TOTAL ANTICIPATED CONSTRUCTION EXPENDITURES: $6,842,684 A budget adjustment in the amount of $6,190,690 from Wastewater Reserves into the Project will be necessary to fund the construction, contingency, construction administration, and engineering design support during construction.

COMMITTEE RECOMMENDATION:

The La Loma Sewer Replacement Phase 1 Project, was presented to the Economic Development Committee on March 6, 2023; Where it was recommended that staff present the award of the project to Council upon successful bidding.

CEQA/NEPA REQUIREMENTS:

Environmental review has been provided through a Categorical Exemption under CEQA Section 15301 (Ex. Facilities) Class1, (b).

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution approving Plans and Specifications for the Rebid La Loma Sewer Replacement Phase 1 Project, accepting the bid, and approving a Construction Contract with Mozingo Construction Inc, of Oakdale, CA, in the amount of $5,282,147 plus $792,322 in Contingency (if needed) for a total amount not to exceed $6,074,469 and authorizing the City Manager, or his designee, to execute the contract.
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City Council, August 22, 2023
Award Rebid La Loma Sewer Replacement Phase 1 Project

Resolution authorizing an increase in the Director’s Authority to issue Change Orders for the Rebid La Loma Sewer Replacement Phase 1 Project from 8% ($422,572) to 15% ($792,322) of the Construction Contract price of $5,282,147 with Mozingo Construction Inc, of Oakdale, CA.

Resolution amending the Fiscal Year 2023-24 Capital Improvement Program Budget in the amount of $6,190,690 to be transferred into the Project from Wastewater Reserves to fund the Rebid La Loma Sewer Replacement Phase 1 Project and authorizing the City Manager, or his designee, to implement the provisions of the Resolution.

Approved by:

William Wong, Director of Utilities
Joseph P. Lopez, City Manager
Attachments:

1. Resolutions (3)

2. Construction Contract with Mozingo Construction Inc, of Oakdale, CA and Financial Interest Disclosure Form

3. Bid Results
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1 2023-XXX

MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XXX

RESOLUTION APPROVING PLANS AND SPECIFICATIONS FOR THE REBID LA LOMA SEWER REPLACEMENT PHASE 1 PROJECT, ACCEPTING THE

BID, AND APPROVING A CONSTRUCTION CONTRACT WITH MOZINGO CONSTRUCTION INC, OF OAKDALE, CA, IN THE AMOUNT OF $5,282,147 PLUS $792,322 IN CONTINGENCY (IF NEEDED) FOR A TOTAL AMOUNT NOT TO EXCEED $6,074,469 AND AUTHORIZING THE CITY MANAGER, OR

HIS DESIGNEE, TO EXECUTE THE CONTRACT
WHEREAS, in the La Loma Phase 1 Area, there are old, deficient sewer lines which are undersized and in some areas do not meet the self-cleaning velocity as specified in the City Standard Specifications, and
WHEREAS, this project will upsize approximately 7,400 linear feet of sewer lines and will address the existing slope issues, bringing it in compliance with current City standards, and
WHEREAS, in addition to the gravity lines, new laterals will also be installed in various locations throughout the neighborhood along with a 6-inch sewer force main to reroute and replace the existing old line, and
WHEREAS, the project was initially advertised for bids on March 7, 2023 and bids were publicly opened on April 11, 2023, pursuant to City Charter Section 1307, and WHEREAS, there was a substantial discrepancy between the two bids, and WHEREAS, Staff recommended the rejection of the bids received and the readvertising of the project at a different date, and WHEREAS, on May 23, 2023, by Resolution 2023-239, Council approved rejecting all bids for the La Loma Sewer Replacement Phase 1 Project and authorizing staff to re-advertise the project, and
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2 2023-XXX
WHEREAS, the Rebid La Loma Sewer Replacement Phase 1 Project was readvertised for bids on June 6, 2023, and WHEREAS, bids were publicly opened on July 11, 2023, pursuant to City Charter Section 1307; Two bids were received and Mozingo Construction Inc, of Oakdale, CA, was the responsible bidder with the lowest responsive bid, and WHEREAS, Modesto Municipal Code Section 8-3.203 generally requires all purchases, which meet or exceed $50,000 for material, equipment or contractual services to be formally bid, and
WHEREAS, the award of Contract for the construction of the Rebid La Loma Sewer Replacement Phase 1 Project to Mozingo Construction Inc, of Oakdale, CA, conforms to the Modesto Municipal Code, 8-3.203, and
WHEREAS, Staff recommends awarding the Contract to Mozingo Construction Inc, of Oakdale, CA.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the plans and specifications for the Rebid La Loma Sewer Replacement Phase 1 Project; accepting the bid and awarding a Construction Contract to Mozingo Construction Inc, of Oakdale, CA, for a total of $5,282,147 plus $792,322 in contingency (if needed) for a total amount not to exceed $6,074,469.

BE IT FURTHER RESOLVED that the City Manager, or his designee, is hereby authorized to execute the Contract, in a form approved by the City Attorney. #15..
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1 2023-
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST: _____________________________
DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ________________________________
JOSE M. SANCHEZ, City Attorney
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1 2023-

MODESTO CITY COUNCIL
RESOLUTION NO. 2023-
RESOLUTION AUTHORIZING AN INCREASE IN THE DIRECTOR’S

AUTHORITY TO ISSUE CHANGE ORDERS FOR THE REBID LA LOMA
SEWER REPLACEMENT PHASE 1 PROJECT FROM 8% ($422,572) TO 15% ($792,322) OF THE CONSTRUCTION CONTRACT PRICE OF $5,282,147 WITH

MOZINGO CONSTRUCTION INC, OF OAKDALE, CA
WHEREAS, the City’s “Change Order Approval Policy”, enacted by Council Resolution No. 94-443 on July 19, 1994, and updated by Resolution No. 2019-326 on July 9, 2019, established a contract change order budget of 8% for projects between $1 Million and $10 Million, and
WHEREAS, given the nature of this project, additional work may be needed to address unexpected conditions that require changes in the project scope that may exceed the Director’s Authority of 8% ($422,572) of the contract amount of $5,282,147, and WHEREAS, staff is requesting authorization to increase the contract change order budget to 15% ($792,322) due to the nature of the project and the unknown challenges.

NOW, THEREFORE BE IT RESOLVED by the Council of the City of Modesto that it hereby authorizes the Director of Engineering to issue change orders for the Rebid La Loma Sewer Replacement Phase 1 Project from 8% ($422,572) to 15% ($792,322) of the construction contract price of $5,282,147 with Mozingo Construction Inc, of Oakdale, CA.
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2 2023-
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST:

DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ____________________________________
JOSE M. SANCHEZ, City Attorney
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1 2023-

MODESTO CITY COUNCIL
RESOLUTION NO. 2023-
RESOLUTION AMENDING THE FISCAL YEAR 2023-24 CAPITAL
IMPROVEMENT PROGRAM BUDGET IN THE AMOUNT OF $6,190,690 TO

BE TRANSFERRED INTO THE PROJECT FROM WASTEWATER RESERVES TO FUND THE REBID LA LOMA SEWER REPLACEMENT PHASE 1

PROJECT AND AUTHORIZING THE CITY MANAGER, OR HIS DESIGNEE,

TO IMPLEMENT THE PROVISIONS OF THE RESOLUTION
WHEREAS, certain budgetary transactions are necessary in the amount of $6,190,690, in order to fund the Rebid La Loma Sewer Replacement Phase 1 Project, and WHEREAS, the Fiscal Year 2023-24 Capital Improvement Program Budget must be amended.

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Modesto that it hereby approves the amendment of the Fiscal Year 2023-24 Capital Improvement Program Budget in the amount of $6,190,690.

BE IT FURTHER RESOLVED that the City Manager, or his designee, is hereby authorized to implement the provisions of this resolution. #15..
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2 2023-
The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST:

DIANE NAYARES-PEREZ, CMC, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ____________________________________
JOSE M. SANCHEZ, City Attorney
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Bid Tabulation Friday, July 14, 2023
Project Title: Rebid La Loma Sewer Phase 1
Project ID #: 2023-016
Vault ID #: 12-D-0553
Account #: 101066
Bid Opening: 7/11/2023 at 11:00 AM
Basis of Award: By Base Bid Designer: Cristian Ciotau
Design Manager: Cristian Ciotau
Project Description: A CCTV survey in the La Loma Neighborhood identified multiple sewer segments that have either failed or will fail in the near future. The La Loma Sewer project is a response to the CCTV survey and will replace the worst of the sewer segments within the project area.

Item # Item Description Units Quantity Unit Price Extension Apparent Low Bidder
Mozingo Construction, Inc.
(209) 848-0160 751 Wakefield Ct., Oakdale, CA 95361
Base Bid
1 Monument Preservation LS 1 $21,500.00 $21,500.00
2 Storm Water Pollution Prevention Plan LS 1 $35,000.00 $35,000.00 (SWPPP)
3 Potholing LS 1 $150,000.00 $150,000.00
4 Shoring, Bracing, and Sheeting LS 1 $185,000.00 $185,000.00 5 Clearing and Grubbing LS 1 $40,000.00 $40,000.00
6 Furnish and Install 48-inch SSMH EA 6 $50,500.00 $303,000.00 7 Remove Existing SSMH and Replace with EA 13 $18,650.00 $242,450.00 New 48-inch SSMH
8 Remove Existing SSMH and Replace with EA 3 $21,250.00 $63,750.00 Drop SSMH
9 Remove Existing SSMH and Replace with EA 3 $21,250.00 $63,750.00 60-inch SSMH
10 Remove Existing SSMH EA 7 $1,800.00 $12,600.00
11 Connect to Existing SSMH EA 5 $2,500.00 $12,500.00
12 Remove Existing TMH and Replace with EA 2 $10,500.00 $21,000.00 New 48-inch TMH
13 Connect to Existing TMH EA 4 $2,300.00 $9,200.00
14 Remove Existing 6-inch Sewer Main and LF 1156 $164.00 $189,584.00 Replace with 10-inch DR26 Sewer Main
15 Remove Existing 6-inch Sewer Main and LF 882 $175.00 $154,350.00 Replace with 10-inch DR18 Sewer Main
16 Remove Existing 6-inch Sewer Main and LF 475 $198.00 $94,050.00 Replace with 10-inch DR14 Sewer Main
17 Remove Existing 6-inch Sewer Main and LF 1651 $148.00 $244,348.00 Replace with 8-inch DR26 Sewer Main
18 Remove Existing 6-inch Sewer Main and LF 2575 $162.00 $417,150.00 Replace with 8-inch DR18 Sewer Main
19 Furnish and Install 8-inch DR26 Sewer Main LF 285 $148.00 $42,180.00 20 Furnish and Install 8-inch DR18 Sewer Main LF 271 $162.00 $43,902.00 #15..
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21 Furnish and Install 6-inch DR18 Sewer Force LF 197 $154.00 $30,338.00 Main
22 Remove Existing 4-inch Sewer Main and LF 8 $250.00 $2,000.00 Replace with 4-inch DR26 Sewer Main
23 Abandon Existing 6-inch Sewer Main with LS 1 $13,400.00 $13,400.00 CDF
24 Remove Existing 8-inch Sewer Main LF 139 $46.00 $6,394.00 25 CCTV Pipeline Inspection LF 7500 $9.00 $67,500.00
26 Furnish and Install H20 Rated Clean-Out EA 164 $3,550.00 $582,200.00 27 Remove Existing Clean-Out and Replace EA 3 $700.00 $2,100.00 with H20 Rated Clean-Out
28 Connect Existing Sewer Lateral to New Main EA 18 $1,800.00 $32,400.00 29 Sawcut Concrete and Hot Mix Asphalt LS 1 $100,000.00 $100,000.00 30 Remove and Replace Existing Concrete SQFT 1716 $69.00 $118,404.00 Driveways
31 Remove and Replace Existing Concrete SQFT 1649 $57.00 $93,993.00 Valley Gutters
32 Install Concrete Valley Gutter SQFT 3016 $49.00 $147,784.00 33 Remove and Replace Existing Vertical Curb LF 210 $142.00 $29,820.00 and Gutter
34 Hot Mix Asphalt TON 2000 $253.00 $506,000.00
35 Aggregate Base CY 4000 $174.00 $696,000.00
36 Replace Existing Landscaping and Irrigation LS 1 $30,000.00 $30,000.00 37 Support and Shoring of MID Poles LS 1 $15,000.00 $15,000.00 38 Road Striping LS 1 $130,000.00 $130,000.00
39 By-pass Pumping LS 1 $128,500.00 $128,500.00
40 Construction Area Signs and Traffic Control LS 1 $124,500.00 $124,500.00 41 Vehicle Detection Cameras LS 1 $65,000.00 $65,000.00 42 Structural Calculations LS 1 $10,000.00 $10,000.00
43 Lead Compliance Plan LS 1 $5,500.00 $5,500.00
Total: $5,282,147.00
Percent From Engineer's Estimate: -10.40%
D. A. Wood Construction Inc.
(209) 491-4970 963 Shepard Ct., Oakdale, CA 95361
Base Bid
1 Monument Preservation LS 1 $8,850.00 $8,850.00
2 Storm Water Pollution Prevention Plan LS 1 $27,400.00 $27,400.00 (SWPPP)
3 Potholing LS 1 $60,000.00 $60,000.00
4 Shoring, Bracing, and Sheeting LS 1 $250,000.00 $250,000.00 5 Clearing and Grubbing LS 1 $20,500.00 $20,500.00
6 Furnish and Install 48-inch SSMH EA 6 $17,500.00 $105,000.00 7 Remove Existing SSMH and Replace with EA 13 $18,200.00 $236,600.00 New 48-inch SSMH
8 Remove Existing SSMH and Replace with EA 3 $90,000.00 $270,000.00 Drop SSMH
9 Remove Existing SSMH and Replace with EA 3 $23,000.00 $69,000.00 60-inch SSMH
10 Remove Existing SSMH EA 7 $1,650.00 $11,550.00
11 Connect to Existing SSMH EA 5 $2,800.00 $14,000.00
12 Remove Existing TMH and Replace with EA 2 $17,000.00 $34,000.00 New 48-inch TMH
13 Connect to Existing TMH EA 4 $4,500.00 $18,000.00
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14 Remove Existing 6-inch Sewer Main and LF 1156 $175.00 $202,300.00 Replace with 10-inch DR26 Sewer Main
15 Remove Existing 6-inch Sewer Main and LF 882 $200.00 $176,400.00 Replace with 10-inch DR18 Sewer Main
16 Remove Existing 6-inch Sewer Main and LF 475 $200.00 $95,000.00 Replace with 10-inch DR14 Sewer Main
17 Remove Existing 6-inch Sewer Main and LF 1651 $155.00 $255,905.00 Replace with 8-inch DR26 Sewer Main
18 Remove Existing 6-inch Sewer Main and LF 2575 $155.00 $399,125.00 Replace with 8-inch DR18 Sewer Main
19 Furnish and Install 8-inch DR26 Sewer Main LF 285 $115.00 $32,775.00 20 Furnish and Install 8-inch DR18 Sewer Main LF 271 $120.00 $32,520.00 21 Furnish and Install 6-inch DR18 Sewer Force LF 197 $285.00 $56,145.00 Main
22 Remove Existing 4-inch Sewer Main and LF 8 $203.00 $1,624.00 Replace with 4-inch DR26 Sewer Main
23 Abandon Existing 6-inch Sewer Main with LS 1 $22,000.00 $22,000.00 CDF
24 Remove Existing 8-inch Sewer Main LF 139 $56.00 $7,784.00 25 CCTV Pipeline Inspection LF 7500 $11.00 $82,500.00
26 Furnish and Install H20 Rated Clean-Out EA 164 $3,250.00 $533,000.00 27 Remove Existing Clean-Out and Replace EA 3 $4,000.00 $12,000.00 with H20 Rated Clean-Out
28 Connect Existing Sewer Lateral to New Main EA 18 $3,065.00 $55,170.00 29 Sawcut Concrete and Hot Mix Asphalt LS 1 $120,500.00 $120,500.00 30 Remove and Replace Existing Concrete SQFT 1716 $77.00 $132,132.00 Driveways
31 Remove and Replace Existing Concrete SQFT 1649 $58.00 $95,642.00 Valley Gutters
32 Install Concrete Valley Gutter SQFT 3016 $59.00 $177,944.00 33 Remove and Replace Existing Vertical Curb LF 210 $150.00 $31,500.00 and Gutter
34 Hot Mix Asphalt TON 2000 $275.00 $550,000.00
35 Aggregate Base CY 4000 $175.00 $700,000.00
36 Replace Existing Landscaping and Irrigation LS 1 $12,300.00 $12,300.00 37 Support and Shoring of MID Poles LS 1 $16,900.00 $16,900.00 38 Road Striping LS 1 $65,500.00 $65,500.00
39 By-pass Pumping LS 1 $60,000.00 $60,000.00
40 Construction Area Signs and Traffic Control LS 1 $175,000.00 $175,000.00 41 Vehicle Detection Cameras LS 1 $82,000.00 $82,000.00 42 Structural Calculations LS 1 $9,500.00 $9,500.00
43 Lead Compliance Plan LS 1 $4,500.00 $4,500.00
Total: $5,322,566.00
Percent From Engineer's Estimate: -9.71%
Engineer's Estimate
Base Bid
1 Monument Preservation LS 1 $30,000.00 $30,000.00
2 Storm Water Pollution Prevention Plan LS 1 $15,000.00 $15,000.00 (SWPPP)
3 Potholing LS 1 $49,000.00 $49,000.00
4 Shoring, Bracing, and Sheeting LS 1 $200,000.00 $200,000.00 5 Clearing and Grubbing LS 1 $50,000.00 $50,000.00
6 Furnish and Install 48-inch SSMH EA 6 $15,000.00 $90,000.00 #15..
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7 Remove Existing SSMH and Replace with EA 13 $40,000.00 $520,000.00 New 48-inch SSMH
8 Remove Existing SSMH and Replace with EA 3 $18,000.00 $54,000.00 Drop SSMH
9 Remove Existing SSMH and Replace with EA 3 $18,000.00 $54,000.00 60-inch SSMH
10 Remove Existing SSMH EA 7 $7,000.00 $49,000.00
11 Connect to Existing SSMH EA 5 $10,000.00 $50,000.00
12 Remove Existing TMH and Replace with EA 2 $15,000.00 $30,000.00 New 48-inch TMH
13 Connect to Existing TMH EA 4 $10,000.00 $40,000.00
14 Remove Existing 6-inch Sewer Main and LF 1156 $200.00 $231,200.00 Replace with 10-inch DR26 Sewer Main
15 Remove Existing 6-inch Sewer Main and LF 882 $230.00 $202,860.00 Replace with 10-inch DR18 Sewer Main
16 Remove Existing 6-inch Sewer Main and LF 475 $230.00 $109,250.00 Replace with 10-inch DR14 Sewer Main
17 Remove Existing 6-inch Sewer Main and LF 1651 $180.00 $297,180.00 Replace with 8-inch DR26 Sewer Main
18 Remove Existing 6-inch Sewer Main and LF 2575 $180.00 $463,500.00 Replace with 8-inch DR18 Sewer Main
19 Furnish and Install 8-inch DR26 Sewer Main LF 285 $150.00 $42,750.00 20 Furnish and Install 8-inch DR18 Sewer Main LF 271 $180.00 $48,780.00 21 Furnish and Install 6-inch DR18 Sewer Force LF 197 $135.00 $26,595.00 Main
22 Remove Existing 4-inch Sewer Main and LF 8 $500.00 $4,000.00 Replace with 4-inch DR26 Sewer Main
23 Abandon Existing 6-inch Sewer Main with LS 1 $20,000.00 $20,000.00 CDF
24 Remove Existing 8-inch Sewer Main LF 139 $150.00 $20,850.00 25 CCTV Pipeline Inspection LF 7500 $10.00 $75,000.00
26 Furnish and Install H20 Rated Clean-Out EA 164 $5,000.00 $820,000.00 27 Remove Existing Clean-Out and Replace EA 3 $5,000.00 $15,000.00 with H20 Rated Clean-Out
28 Connect Existing Sewer Lateral to New Main EA 18 $1,500.00 $27,000.00 29 Sawcut Concrete and Hot Mix Asphalt LS 1 $60,000.00 $60,000.00 30 Remove and Replace Existing Concrete SQFT 1716 $50.00 $85,800.00 Driveways
31 Remove and Replace Existing Concrete SQFT 1649 $50.00 $82,450.00 Valley Gutters
32 Install Concrete Valley Gutter SQFT 3016 $30.00 $90,480.00 33 Remove and Replace Existing Vertical Curb LF 210 $80.00 $16,800.00 and Gutter
34 Hot Mix Asphalt TON 2000 $200.00 $400,000.00
35 Aggregate Base CY 4000 $175.00 $700,000.00
36 Replace Existing Landscaping and Irrigation LS 1 $15,000.00 $15,000.00 37 Support and Shoring of MID Poles LS 1 $100,000.00 $100,000.00 38 Road Striping LS 1 $75,000.00 $75,000.00
39 By-pass Pumping LS 1 $350,000.00 $350,000.00
40 Construction Area Signs and Traffic Control LS 1 $200,000.00 $200,000.00 41 Vehicle Detection Cameras LS 1 $60,000.00 $60,000.00 42 Structural Calculations LS 1 $20,000.00 $20,000.00
43 Lead Compliance Plan LS 1 $4,505.00 $4,505.00
Total: $5,895,000.00
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CITY OF MODESTO

COUNCIL AGENDA REPORT
DATE OF MEETING:

August 22, 2023
Date: August 2, 2023
TO: Mayor and City Council
THROUGH: Joseph P. Lopez, City Manager
FROM: William Wong, Director of Utilities
SUBJECT: Proposition 218 Hearing Regarding Proposed Water Rate Increases CONTACT: William Wong, Director of Utilities, [email protected], 209-571-5801

DESCRIPTION
Hearing to consider Proposed Water Rate Increases for Fiscal Year 2023-24 through 2027-28. (Funding Source: Water Fund)
STRATEGIC PLAN ELEMENT:

The recommended action supports the 2020-2025 City’s Strategic Plan Initiatives, Goal D:

Provide safe, efficient, and reliable infrastructure through proactive community investment, maintenance, and sustainability efforts.

BACKGROUND:

The City of Modesto provides water service to over 74,000 accounts consisting of residential, multi-family, commercial, and industrial customers located within the City of Modesto, as well as the communities of Salida, Empire, Grayson, Del Rio, and portions of Turlock and unincorporated Stanislaus County. The City’s water utility is a self-supporting utility enterprise funded by customer revenues from the sale of groundwater and treated surface water purchased from the Modesto Irrigation District.

In 1996, California voters adopted Proposition 218, which amended the California Constitution to establish a process that public agencies must follow when imposing new or increasing property related fees. In 2007, the California Supreme Court ruled that water service fees are property related fees, thus subject to Proposition 218 requirements. Proposition 218 mandates that any property-related fee imposed by a public agency cannot exceed the proportionate cost of providing that service to the customers. Revenues generated by the fees cannot be used for any purpose other than that for which the fee is imposed. The fees charged by the City for ongoing water service are property related fees.

Proposition 218 also requires that a public agency mail a notice of the proposed rate increases to all affected property owners or ratepayers and conduct a public hearing to consider the proposed increases. The notice must include the proposed rate and fee amounts, state how the rates and #16..
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

fees were calculated, the reason for the fees, and the date, time, and location of the public hearing. The notice must also inform affected property owners or ratepayers that the rate increase is subject to a majority protest, meaning that if more than fifty percent (50%) of affected property owners or ratepayers submit written protests against the proposed rate increase, the increase will not be adopted. The notice must be sent to the affected property owners or ratepayers at least forty-five (45) days before the date of the public hearing.

The City last conducted an in-depth cost of service rate study in 2016, which was approved and implemented by Resolution No. 2016-241. This Resolution established rates from fiscal year (FY) 2016-17 through 2020-21. The last rate change occurred October 1, 2021.

Table 1 - Previous Adopted Water Rate Increases (FY 2017-2021) In the current economic environment, changes in the City’s water utility, including escalating operation and maintenance costs due to inflation, new regulatory requirements, and major water system capital improvements, requires the City to update its water rate structure, and adopt a new five-year schedule of adjustments.

On December 8, 2020, Council, by Resolution No. 2020-526 approved an agreement with West Yost to update the Water System Engineer’s Report (Engineer’s Report) for a total not to exceed amount of $53,350, which serves as the basis for the Water Rate Study, providing the justification and allocation of costs for the proposed water Capital Improvement Program between existing and future customer classes.

On December 8, 2020, Council, by Resolution No. 2020-525, approved an agreement with Bartle Wells Associates (BWA) to conduct a comprehensive cost of service review of the water rates and fees (Water Rate Study), for a total not to exceed amount of $146,218, and prepare a new water rate and fee structure that is compliant with all legal requirements of Proposition 218.

DISCUSSION:

Water Rate Review
The BWA Water Rate Study found that prior water rate and fee increases had strengthened the financial condition of the Water Fund. However, current rates are not adequate to fund the needed water system reliability, water quality improvements, and meet regulatory mandates.

The analysis of the completed Engineer’s Report and water system Capital Improvement Program (CIP) cash flow has identified a range of approximately $138 million to $185 million in CIPs between FY 2023-2027. Key CIPs to address water system reliability, water quality improvements and regulatory mandates (such as AB 1668 and SB 606) include:
 Strengthen & Replace Water System Pipeline Projects
FY 2017-2021
Water Rates
FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
% Increase 25.04% 11.08% 9% 9%
(revised to 6%)
9%
(revised to 2%)
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

 New and Replacement Wells and Wellhead Treatment
 Supervisory Control and Data Acquisition (SCADA) upgrades  Backup Power/Emergency Generators
 Advanced Metering Infrastructure (AMI)
 Water Storage Tank Improvements
 Sustainable Groundwater Studies and Projects
 Flow Transmission Main Capacity Improvements
 Additional/Upsized Transmission Mains and Pump Stations for South Modesto and Growth Areas
The CIP costs are incorporated into the comprehensive Water Rate Study update. Key rate and fee impacts were analyzed, including:
 Updating the cost of service, including steep inflationary increases  Rate design
 Amount of capital improvement spending
 Developing drought and non-drought rates
 Setting rates to recover operating costs and capital improvements  Evaluating revenue recovery from fixed meter charges vs. volume rate  Funding of capital improvements
BWA’s rate recommendations include modifications to the cost-of-service allocations and water rates. The recommended rates are designed to recover the Water utility’s cost of service and proportionately recover costs from customers. The financial challenges over the next five years will be to maintain debt service coverage and to stabilize revenues with reduced water volume sales, resulting from ongoing water conservation, regulatory mandates, and looming drought conditions.

Table 2 –Water Rate Scenarios (FY 2024-2028)
FY 2023-24
% increase
FY 2024-25
% increase
FY 2025-26
% increase
FY 2026-27
% increase
FY 2027-28
% increase
Scenario 1
Reduced (Low) CIP
– No Debt ($138M)

4.5% 4.5% 4.5% 4.5% 4.5%
Scenario 2
Full CIP – with
Debt ($185M)

4.5% 4.5% 4.5% 4.5% 4.5%
Scenario 3
Full CIP – No Debt
($185M)

6.5% 6.5% 6.5% 6.5% 6.5%
BWA evaluated several scenarios during the development of the water rate schedule for FY 2023- 24 through FY 2027-28 and has provided a recommended rate structure. Rate increases are necessary to fund increasing wastewater operational costs and capital improvement projects. #16..
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

Based on BWA analysis, Staff is recommending Scenario 2 - Full Capital Plan with Debt, effective October 1, 2023. The recommended annual 4.5% water rate increase includes proposed debt financing to fund the full CIP program, including implementing the AMI project, which will help the City comply with the state water use mandates from Assembly Bill (AB) 1668 and Senate Bill (SB) 606.

In addition, the proposed 4.5% annual rate increase is still below the City’s projected inflationary budget increases of 5.0%, maintains the Water Fund’s strong credit rating (currently AA with S&P) and provides a debt coverage ratio of over 2.0, which is recommended by the City’s financial consultants for the water utility. While $40M in debt financing is anticipated, the City’s strong credit rating will benefit the City with favorable financing terms (if needed), City Staff will continue to pursue alternate State and Federal funding opportunities to offset City Water Fund costs and could potentially reduce the amount of debt required.

The Water Rate Study allocated cost between fixed costs for customer service and meter size, and variable cost of water used (volume) by meter. The table below reflects the recommended proposed rate schedule that includes the fully funded CIP.

Table 3 – Proposed Water Rates
A separate drought surcharge rate to be used only under drought conditions was developed to promote conservation, while minimizing impacts to the Water Fund Revenue. Currently, drought #16..
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

rates will be implemented when the Governor of California declares a state-wide drought, or through City Council action, when local water supplies are unsustainable and reach Stage 3 of the City’s Water Shortage Contingency Plan.

Under drought conditions, customers will pay a higher rate and consume less water, thereby maintaining a similar water bill as a non-drought condition. This surcharge will be implemented to recover the City’s water costs, many of which are fixed and do not decrease when conservation increases, from projected drought-level water use.

On June 27, 2023, Council, by Resolutions No. 2023-315 and No. 2023-316, approved the Engineer’s Report and Water Rate Study, and by Resolution No. 2023-317 authorized Staff to issue Proposition 218 notices for Scenario #2. Notices have been sent to all affected ratepayers and property owners in accordance with applicable requirements.

If, after the close of the public hearing, it is determined that there is no majority protest, the City Council may adopt a resolution approving the five-year schedule of rates. This resolution establishes the maximum rates the City may impose each year.

FISCAL IMPACT:

The City’s water utility relies almost entirely on customer revenues to sustain its operations. The proposed increases will generate revenue to fund system operational and infrastructure needs identified in the Water Engineer’s Report, and to continue to provide reliable and high-quality water services. This rate will allow the City to maintain its current debt service coverage ratio of over 1.50, which is essential to maintain a strong credit rating and the financial health of the Wastewater Fund.

Commented [SOC1]: Department may want to insert the cash flow projections table (Table 9 on page 17 of the Water Rate Study from Bartle Wells) to show the full impacts of Scenario 2 on the Water Fund.
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

Table 4 – Proposed Rate Scenario Detailed Cash Flow Projections Projected Cashflow FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Rate Revenue Increase 4.5% 4.5% 4.5% 4.5% 4.5% Demand Increase 0% 0% 0% 0% 0% Beginning Reserves $110,862,007 $102,018,732 $83,692,561 $66,010,273 $67,757,563 Revenues
Rate Revenue $79,021,999 $82,743,145 $86,639,520 $90,719,375 $94,991,350 Rate Increase Revenue 3,555,990 3,723,442 3,898,778 4,082,372 4,274,611 Timing Adjustment* -592,665
Other Revenue 4,650,665 4,559,418 4,486,792 4,416,744 4,424,415 Interest on Reserves $_4_4_3__,4_4_8_ $_4_0_8__,0_7_5_ $_3_3_4__,7_7_0_ $_2_6_4__,0_4_1_ $_2_7_1__,0_3_0_ Total Revenue $87,079,437 $91,434,079 $95,359,861 $99,482,532 $103,961,406 Expenses
Operating Expenses $58,312,292 $59,483,407 $62,419,327 $65,502,043 $68,738,895 Existing Debt Service 11,985,419 12,685,819 12,685,819 12,685,820 12,685,821 New Debt Service 0 0 0 0 2,622,000
Rate Funded Capital $25,625,000 $37,591,025 $37,937,002 $19,547,379 $24,194,205 ________ ________ ________ ________ ________
Total Expenses $95,922,711 $109,760,251 $113,042,148 $97,735,242 $108,240,921 Net Revenues -$8,843,274 -$18,326,172 -$17,682,287 $1,747,289 -$4,279,515 Ending Reserves $102,018,732 $83,692,561 $66,010,273 $67,757,563 $63,478,048 Debt Coverage (Target 2.0) 2.40 2.52 2.60 2.68 2.30
*Reflects October rate implimentation
Capital Funding FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Capital Revenues
Use of Debt Proceeds $20,000,000 $20,000,000
Rate Funded Capital $25,625,000 $37,591,025 $37,937,002 $19,547,379 $24,194,205 ________ ________ ________ ________ ________
Total Capital Revenue $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Total Capital Expenditures $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 #16..
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

Modesto’s proposed water rate increase is in the median in comparison with nearby regional agencies.

CEQA/NEPA REQUIREMENTS:

The adoption of the proposed rate increase does not constitute a project for the purposes of the California Environmental Quality Act.

COMMITTEE RECOMMENDATION:

This item was considered by the Economic Development Committee at the May 1, 2023 meeting, where it was recommended that it be forwarded to Council.

RECOMMENDED COUNCIL ACTION:

Staff Recommendations:

Resolution adopting Water Service Rates, effective October 1, 2023, for Fiscal Years 2023-24 through 2027-28 in accordance with Proposition 218.

Approved by:

William Wong, Director of Utilities
Joseph P. Lopez, City Manager
Attachments:
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City Council, August 22, 2023
Proposition 218 Hearing Regarding Proposed Water Rate Increases

1. Resolution

2. Water System Engineer’s Report

3. Water Rate Study

4. Proposition 218 Ballot
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MODESTO CITY COUNCIL
RESOLUTION NO. 2023-XX
RESOLUTION ADOPTING WATER SERVICE RATES, EFFECTIVE OCTOBER 1, 2023, FOR FISCAL YEARS 2023-24 THROUGH 2027-28 IN ACCORDANCE WITH PROPOSITION 218
WHEREAS, the City provides water service to over 74,000 accounts consisting of residential, multi-family, commercial, and industrial customers located within the City of Modesto as well as the communities of Salida, Empire, Grayson, Del Rio, and portions of Turlock and unincorporated Stanislaus County, and
WHEREAS, the City’s water utility is a self-supporting utility enterprise funded by customer revenues from the sale of groundwater and treated surface water purchased from the Modesto Irrigation District, and
WHEREAS, the City’s water utility relies almost entirely on customer revenues to sustain its operations, and
WHEREAS, water rates generate revenue to fund system operational and infrastructure needs, and to continue to provide reliable and high-quality water services to the City’s water customers, and
WHEREAS, Modesto Municipal Code Section 11-6.05 authorizes Council, by resolution, to establish charges for metered water services, and
WHEREAS, the City last conducted an in-depth cost of service rate study in 2016, and WHEREAS, the City Council approved the previous 5-year water rate increase from fiscal year (FY) 2016-17 through 2020-21, with the last rate change occurring on October 1, 2021, and #16..
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WHEREAS, in the current economic environment, changes in the City’s water utility, including escalating operation and maintenance costs due to inflation, new regulatory requirements, and major water system capital improvements, require the City to update its water rate structure, and adopt a new five-year schedule of adjustments, and WHEREAS, the City engaged with West Yost to update the Water System Engineer’s Report (Engineer’s Report) which serves as the basis for the Water Rate Study, providing the justification and allocation of costs for the proposed water Capital Improvement Program (CIP) between existing and future customer classes, and
WHEREAS, the analysis of the completed Engineer’s Report and water system CIP cash flow has identified $185 million in water system projects between FY 2023 through 2027, to address water system reliability, water quality improvements and regulatory mandates (such as AB 1668 and SB 606), and
WHEREAS, the City engaged with Bartle Wells Associates (BWA) to conduct a comprehensive cost of service review of the water rates and fees (Water Rate Study), and prepare a new water rate and fee structure that is compliant with all legal requirements of Proposition 218, and
WHEREAS, the BWA Water Rate Study found that although prior water rate and fee increases had strengthened the financial condition of the Water Fund, the current rates are not adequate to fund the needed water system reliability, water quality improvements, and meet regulatory mandates, and
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WHEREAS, BWA’s rate recommendations include modifications to the cost-of-service allocations and water rates, and
WHEREAS, BWA’s recommended rates are designed to recover the Water utility’s cost of service and proportionately recover costs from customers, and WHEREAS, the financial challenges over the next five years will be to maintain debt service coverage and to stabilize revenues with reduced water volume sales, resulting from ongoing water conservation, regulatory mandates, and looming drought conditions, and WHEREAS, BWA evaluated several scenarios during the development of the water rate schedule for FY 2023-24 through FY 2027-28 and has provided a recommended rate structure, and
WHEREAS, water rate increases are necessary to fund increasing water operational costs and capital improvement projects, and
WHEREAS, based on BWA analysis, Staff is recommending annual 4.5% water rate increases, and
WHEREAS, the proposed 4.5% annual rate increase is still below the City’s projected inflationary budget increases of 5.0%, maintains the Water Fund’s strong credit rating (currently AA with S&P) and provides a debt coverage ratio of over 2.0, which is recommended by the City’s financial consultants for the water utility, and WHEREAS, while $40M in debt financing is anticipated, the City’s strong credit rating will benefit the City with favorable financing terms, and #16..
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WHEREAS, City Staff will continue to pursue alternate State and Federal funding opportunities to offset Water Fund costs and could potentially reduce the amount of debt required, and
WHEREAS, the Water Rate Study allocated cost between fixed costs for customer service and meter size, and variable cost of water used (volume) by meter, and WHEREAS, a separate drought surcharge rate to be used only under drought conditions was developed to promote conservation, while minimizing impacts to the Water Fund Revenue, and
WHEREAS, drought rates will be implemented when the Governor of California declares a state-wide drought, or through City Council action, when local water supplies are unsustainable and reach Stage 3 of the City’s Water Shortage Contingency Plan, and WHEREAS, the updated water rates established pursuant to this resolution are not levied for general revenue purposes, and
WHEREAS, the costs listed in the Water Rate Study are reasonable estimates of the cost of providing such services, and that the proposed water service rates are necessary to recover the reasonable estimated cost of providing such services for which the rates are charged, to allocate such costs among City customers so that they bear a fair and reasonable relationship to customers’ burdens on and benefits from City’s water services, to ensure that charges for water services do not exceed the proportionate cost of providing water services attributable to each parcel and to secure the financial stability of City’s water utility in accordance with the analyses contained in the Water Rate Study, and
WHEREAS, the City mailed a Proposition 218 notice of the public hearing, and a notice of written protest procedures against the proposed rate increases to all affected ratepayers in #16..
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compliance with California Constitution Article XIIID, Section 6, at least forty-five (45) days in advance of the public hearing at which this resolution was considered, and WHEREAS, on August 22, 2023, the City Council duly held the public hearing and at its conclusion the City Clerk tabulated the number of written protests received and reported that there was not a majority protest of the proposed water rates by property owners, ratepayers, or their authorized representatives, and
WHEREAS, the City Council desires to establish new water rates.

NOW, THEREFORE BE IT RESOLVED by the Council of the City of Modesto that the above recitals are true and correct, and incorporated herein.

BE IT FURTHER RESOLVED that the Council of the City of Modesto hereby approves the Water Rate Study prepared by Bartle Wells Associates and adopts the following updated water rates to be effective October 1, 2023:
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The foregoing resolution was introduced at a regular meeting of the Council of the City of Modesto held on the 22nd day of August 2023, by Councilmember ?, who moved its adoption, which motion being duly seconded by Councilmember ?, was upon roll call carried and the resolution adopted by the following vote:

AYES: Councilmembers:

NOES: Councilmembers:

ABSENT: Councilmembers:

ATTEST:

DIANE NAYARES-PEREZ, City Clerk
(SEAL)
APPROVED AS TO FORM:

BY: ____________________________________
JOSE M. SANCHEZ, City Attorney
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PREPARED BY
2022 Water System Engineer’s Report

PREPARED FOR
City of Modesto
Updated April 2023
FINAL REPORT | SEPTEMBER 2022
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FINAL REPORT | SEPTEMBER 2022
EARYEAR2020
2022 Water System Engineer’s Report
Prepared for
City of Modesto
Project No. 418-60-20-65
4/14/23
Project Manager: Roberto Vera, PE Date
4/14/23
QA/QC Review: Elizabeth Drayer, PE Date
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i City of Modesto
Engineer’s Report
September 2022 (Updated April 2023)
Table of Contents

1.0 Introduction ................................................................................................................................. 1

2.0 Summary of Capital Improvement Project Costs ............................................................................ 2

3.0 Water System Background ............................................................................................................ 4

3.1 Water Service Area ........................................................................................................................... 4

3.2 Current and Projected Water Demands ........................................................................................... 4

3.3 Existing Water Supplies .................................................................................................................... 6

3.3.1 Groundwater Supply ............................................................................................................... 6

3.3.2 Surface Water Supply.............................................................................................................. 7

4.0 Justification and Cost Allocation for Proposed Improvements ........................................................ 8

4.1 MRWTP Phase Two Expansion (Category 1) .................................................................................... 9

4.2 City-Side Downstream Improvements related to MRWTP Expansion (Category 2) ...................... 10

4.3 Improvements for South Modesto (Category 3) ............................................................................ 11

4.4 Water Quality Related Studies (Category 4) .................................................................................. 12

4.5 SCADA System Upgrades (Category 5) ........................................................................................... 13

4.6 New Corporation Yard (Category 6) ............................................................................................... 14

4.7 Existing Tank Improvements (Category 7) ...................................................................................... 15

4.8 Extend Water Mains Program (Category 8) ................................................................................... 16

4.9 Strengthen and Replace Water System Program (Category 9) ...................................................... 17

4.10 Install New Wells Program (Category 10)..................................................................................... 18

4.11 Wellhead Treatment Program (Category 11) ............................................................................... 19

4.12 Purchase and Install New Generators Program (Category 12) .................................................... 20

4.13 Water System Security Enhancements (Category 13) .................................................................. 21

4.14 Groundwater Management Program (Category 14) .................................................................... 22

4.15 Urban Water Management Plan (Category 15) ........................................................................... 23

4.16 Water Master Plan (Category 16) ................................................................................................. 24

4.17 Water System Evaluations (Category 17) ..................................................................................... 25

4.18 New Water Tanks (Category 18) .................................................................................................. 26

4.19 Water Meters Program (Category 19) .......................................................................................... 27

4.20 New or Replacement Pumps (Category 21) ................................................................................. 28

4.21 Utility Cuts Program (Category 22)............................................................................................... 29

5.0 Project Schedule and Cost Projections ......................................................................................... 30 #16..
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Table of Contents

LIST OF TABLES
Table 1. Summary of Five-Year and Ten-Year Water System Capital Improvement Program Costs and Allocations for Existing and Future Customers ......................................... 3 Table 2. Proposed Ten-Year Water System Capital Improvement Program Expenditures by Year .............................................................................................................. 31

LIST OF FIGURES
Figure 1. Water Service Areas ................................................................................................................ 5

LIST OF ACRONYMS AND ABBREVIATIONS
Af/yr Acre-Feet per Year 3
AMI Advanced Metering Infrastructure 17
AWIA America’s Water Infrastructure Act 13
CIP Capital Improvement Project 1
City City of Modesto 1
ENR Engineering News Record 1
GWMP Groundwater Management Plan 14
IRGMP Integrated Regional Groundwater Management Plan 14 mgd Million Gallons per Day 3
MID Modesto Irrigation District 1
MRWTP Modesto Regional Water Treatment Plant 1
Report 2022 Water System Engineer’s Report 1
RRMS Risk and Resilience Management Strategies 13
SCADA Supervisory Control and Data Acquisition 9
SJV Basin San Joaquin Valley Groundwater Basin 5
SOI Sphere of Influence 3
UWMP Urban Water Management Plan 15
VA Water System Vulnerability Assessment 13
WMP Water Master Plan 1
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1 City of Modesto
Engineer’s Report
September 2022 (Updated April 2023)
2022 Water System Engineer’s Report

1.0 INTRODUCTION
This 2022 Water System Engineer’s Report (Report) is an essential supporting document to conduct new water rate and capacity charge studies for the City of Modesto (City). It describes and justifies the various capital improvement projects and programs that are needed to provide and maintain reliable water service, including required water supplies, storage volumes, pumping capacities, distribution facilities, and system pressures under different demand conditions. It also identifies associated budgetary-level cost estimates and determines the appropriate cost allocation between existing and future water customers.

The City is proposing to fund the needed water system improvements using a combination of water utility rates, capacity charges (connection fees), and possibly some level of bond financing, as appropriate.

This Report is based on capital improvement projects (CIPs) developed as part of the City’s 2017 Water Master Plan (2017 WMP), on-going CIPs identified in the City’s 2021/22 fiscal year preliminary CIP budget, improvements previously identified in the City’s 2016 Engineer’s Report that have not yet been implemented or constructed, improvements by Modesto Irrigation District (MID) associated with the Modesto Regional Water Treatment Plant (MRWTP), as well as other needed improvements identified by City staff. CIPs identified in this Report are based on the best information available at the time of preparation.

It should be noted that estimated program costs and their associated cost allocations, may change as future conditions change (e.g., change in demands, additional and/or new regulations requiring City to implement groundwater well treatment, increase in pipeline failures leading to more strengthen and replace projects).

It is recommended that the City update program costs and associated cost allocations on a regular basis (e.g., every five years). As summarized in the following sections, program costs and allocations are provided for a five-year period and a ten-year period, with costs allocated to existing and future customers based on projected needs within the ten-year capital improvement plan.

This Report is organized into the following sections:
 Introduction
 Summary of Capital Improvement Project Costs
 Water System Background
 Justification and Cost Allocation for Proposed Improvements  Project Schedule and Cost Projections
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2.0 SUMMARY OF CAPITAL IMPROVEMENT PROJECT COSTS
The estimated CIP costs by project category and the recommended allocations between existing and future customers are summarized in Table 1. The new water rate and capacity charge studies will be based on funding only those improvements needed within the next ten years. Thus, the estimated five-year and ten-year program costs are approximately $220 million and $490 million, respectively. Additional information on program costs, and associated timing, is provided in Section 5 of this Report. All costs in this Report have been estimated based on the September 2022 Engineering News Record (ENR) Construction Cost Index of 15083.26 for San Francisco and have been escalated by 4 percent annually 1 to
the year of planned implementation and/or construction.

The CIP costs include allowances for project implementation (i.e., engineering, construction management and program implementation) and a construction contingency. The allowances and construction contingency total 50 percent of the estimated construction cost and are summarized as follows:
 Construction Contingency: 20 percent
 Engineering: 10 percent
 Construction Management: 10 percent
 Program Implementation: 10 percent
As described in Section 4, the cost allocation split between the existing rate payers and future users is specific to each project and is based on a methodology developed for each specific type of CIP. The tenyear CIP cost allocated to existing customers is approximately $407 million (approximately 83 percent of the ten-year cost) and to future users is approximately $83 million (approximately 17 percent of the ten-year cost).
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Total Cost,
dollars
Costs Allocated
to Existing
Customers,
dollars
Costs Allocated
to Future
Customers,
dollars
Total Cost,
dollars
10-Year Costs
Allocated to
Existing
Customers,
dollars
10-year Costs
Allocated to
Future
Customers,
dollars
1 MRWTP Phase Two Expansion 62 / 38 $10,732,400 $6,654,100 $4,078,300 $27,523,000 $17,064,300 $10,458,700 2 City-Side Downstream Improvements related to MRWTP Expansion 62 / 38 $7,971,000 $4,942,000 $3,029,000 $7,971,000 $4,942,000 $3,029,000 3 Improvements for South Modesto 62 / 38 $10,074,200 $6,246,000 $3,828,200 $30,933,700 $19,178,900 $11,754,800 4 Water Quality Related Studies 100 / 0 $130,900 $130,900 $0 $325,100 $325,100 $0 5 SCADA System Upgrades 100 / 0 $8,448,000 $8,448,000 $0 $9,358,000 $9,358,000 $0 6 New Corporation Yard 100 / 0 $9,035,500 $9,035,500 $0 $10,044,600 $10,044,600 $0 7 Existing Tank Improvements 100 / 0 $7,776,000 $7,776,000 $0 $16,009,100 $16,009,100 $0 8 Extend Water Mains 0 / 100 $2,494,300 $0 $2,494,300 $6,285,200 $0 $6,285,200 9 Strengthen and Replace Water System 100 / 0 $69,059,200 $69,059,200 $0 $197,285,600 $197,285,600 $0 10 Install New Wells 30 / 70 $28,985,700 $8,695,700 $20,290,000 $67,190,900 $20,157,300 $47,033,600 11 Wellhead Treatment 100 / 0 $13,537,700 $13,537,700 $0 $27,045,100 $27,045,100 $0 12 Purchase & Install New Generators 100 / 0 $2,543,100 $2,543,100 $0 $6,902,700 $6,902,700 $0 13 Water System Security Enhancements 100 / 0 $558,600 $558,600 $0 $1,133,100 $1,133,100 $0 14 Groundwater Management Program 62 / 38 $2,154,700 $1,335,900 $818,800 $2,773,900 $1,719,800 $1,054,100 15 Urban Water Management Plan 62 / 38 $383,700 $237,900 $145,800 $745,300 $462,100 $283,200 16 Water Master Plan 62 / 38 $479,504 $297,300 $182,204 $1,213,404 $752,300 $461,104 17 Water System Evaluation 62 / 38 $1,648,100 $1,021,800 $626,300 $2,665,300 $1,652,500 $1,012,800 18 New Water Tanks 62 / 38 $4,168,700 $2,584,600 $1,584,100 $4,168,700 $2,584,600 $1,584,100 19 Water Meters 100 / 0 $38,752,300 $38,752,300 $0 $67,693,000 $67,693,000 $0 21 New or Replacement Pumps 100 / 0 $575,100 $575,100 $0 $1,001,100 $1,001,100 $0 22 Utility Cuts 100 / 0 $934,900 $934,900 $0 $2,072,300 $2,072,300 $0 83 / 17 $220,444,000 $183,366,600 $37,077,004 $490,340,000 $407,383,974 $82,956,604 -- 83% 17% -- 83% 17%
Table 1. Summary of Five-Year and Ten-Year Water System Capital Improvement Program Costs and Allocations for Existing and Future Customers(a) Total
(a) Costs based on September 2022 San Francisco Engineering News Record (ENR) Construction Cost Index (CCI) (15083.26). There is no category 20. Category numbers were kept the same to remain consistent with previous reports and City Program numbers. 5-Year Costs 10-Year Costs
Category Number and Name
Existing / Future
Customer
Allocation,
percent
Total Percent Allocation:

N-C-418-60-20-65-E-CIP_DATABASE
City of Modesto
2022 Engineer's Report
Last Revised: 04-14-23
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3.0 WATER SYSTEM BACKGROUND
The City’s existing water system is a conjunctive use system, which utilizes both surface water and groundwater to meet water demands within its water service area. In 2020, the City produced approximately 27,121 acre-feet per year (af/yr) (24.2 million gallons per day, mgd) of groundwater and purchased an estimated 25,983 af/yr (23.2 mgd)2 of treated surface water from MID. The treated surface water and groundwater supplies are used to serve North Modesto (the portion of the City’s contiguous service area north of the Tuolumne River). Groundwater supplies are used to serve South Modesto (the portion of the City’s contiguous service area south of the Tuolumne River) and the outlying areas where the City also provides water service. In the future, additional needed supply will be provided by additional groundwater supplies, pumped from either new wells or existing out-of-service wells that are planned to be rehabilitated.

The characteristics of the City’s water system are described in the following sections:
 Water Service Area
 Current and Projected Water Demands
 Existing Water Supplies

3.1 Water Service Area
The City’s water service area consists of one large contiguous service area and several outlying non-contiguous service areas. The City’s contiguous service area is primarily defined by the current Sphere of Influence (SOI), Salida, North Ceres and some unincorporated Stanislaus County “islands” within or adjacent to the SOI (Empire is within the SOI). The outlying service areas include Grayson, Del Rio, Ceres (Walnut Manor), and portions of Turlock. Figure 1 illustrates the location of the City’s contiguous and outlying service areas.

3.2 Current and Projected Water Demands
The City’s 2017 WMP defined existing demands within the contiguous area to be approximately 71,600 af/yr (63.9 mgd). Based on planned development of vacant areas within the General Plan area, projected water demand at buildout is estimated to be approximately 100,000 af/yr (89.3 mgd).

The City’s 2017 WMP, however, includes existing water demand based on City water use patterns from 2000 through 2013, which is prior to the 2012 to 2016 drought experienced in the State of California.

Since then, the City has been actively implementing water use efficiency and conservation measures that have resulted in a decrease in baseline existing water demand. Actual demand from 2015 to 2020 has ranged from 47,159 af/yr (2016) to 53,104 af/yr (2020), averaging 49,630 af/yr. Since recent actual demands have been lower than the City’s 2017 WMP projections, the City’s 2020 Urban Water Management Plan (UWMP) has reduced the City’s 2017 WMP buildout projections by 15 percent to 86,778 af/yr to reflect more recent and projected water use trends. This Report uses these reduced buildout demand projections (estimated to occur by 2050). 2 These estimates are based on Table 6-13 of the City’s 2020 Urban Water Management Plan. #16..
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0 1 2
Scale in Miles
Notes:

1. Sphere of influence boundary obtained from the City on 11/6/2014.

2. The City's contiguous service area is co-terminus with the City's SOI boundary except for the Salida and North Ceres areas.

3. City limit boundary based on County GIS data downloaded on October 6, 2014.

Turlock
Grayson
Modesto
Salida
Empire
Del Rio
North Ceres
(Portion Served by Modesto)
Ceres (Walnut Manor)
Bret Harte
West Modesto
Shackelford
Stanislaus County
Merced County
CYRD
REEK

ST A NISLAUS RI VE R

SAN JOAQUIN RIVER

DRY CREEK

TUOLUMNE RIVE R

STANISLAUS RIVER
§¨¦5
¬«108
¬«165
¬«99
¬«219
¬«132
¬«33
¬«132
Figure 1
Water Service Areas
City of Modesto
2021 Engineer's Report
Legend
Sphere of Influence (SOI)
Contiguous Service Area
Contiguous Area Outside of SOI
Outlying Service Area
City Limits
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3.3 Existing Water Supplies
The City has two existing water supply sources: local groundwater and treated surface water purchased from MID. The combination of these water supply sources allows the City to implement a conjunctive use operational strategy that is described further under the following topics:
 Groundwater Supply
 Surface Water Supply
The following sections are intended to be a brief overview of the City’s water supplies. Additional detailed information can be found in the City’s WMP and the City’s Urban Water Management Plan (UWMP).

3.3.1 Groundwater Supply
The City’s groundwater supply wells are located throughout the contiguous and outlying service areas, and located within the San Joaquin Valley Groundwater Basin (SJV Basin). The City currently has 89 active groundwater wells (including six wells for non-potable uses and two wells on standby). Groundwater supply is pumped from the following three subbasins within the SJV Basin:
 Modesto Subbasin
 Turlock Subbasin
 Delta-Mendota Subbasin
The City’s contiguous service area and some outlying service areas span both the Modesto and Turlock Subbasins. North Modesto, Salida, Empire, and Del Rio, are located in the Modesto Subbasin. South Modesto, Turlock, North Ceres, and Ceres (Walnut Manor) are located in the Turlock Subbasin. Grayson is located in the Delta-Mendota Subbasin. The City has developed a preliminary operational yield of 51,500 af/yr for the three groundwater subbasins (underlying the City’s service area).

The preliminary operational yield is a long-term average used to assess groundwater reliability for planning level type analyses, such as this Report, during all hydrologic conditions (dry, normal, and wet years). This preliminary operational yield is based on historical groundwater pumping by the City and the general conclusion is that if the total, long-term average groundwater pumping quantity is held at or below 51,500 af/yr, then stable groundwater levels will result, at approximately 40 feet above mean sea level within and near the City’s contiguous service area. If groundwater pumping is significantly less than 51,500 af/yr, groundwater levels will likely rise, thereby increasing the quantity of available groundwater stored within the basin for later use via “in-lieu” groundwater banking. Alternatively, if more than 51,500 af/yr is extracted (e.g., during dry years), groundwater levels will likely decline. However, actual groundwater extractions may be lower in wet years and higher in dry years; consequently, the preliminary groundwater operational yield available to the City for the planning period is assumed to be equal to the long-term average, or 51,500 af/yr.

It is worth noting that while the operational yield is currently defined as 51,500 af/yr, it does not imply that the City has the available infrastructure to extract this amount. As described in the various programs in subsequent sections, there are several groundwater well improvements planned. These improvements are intended to bolster the City’s infrastructure to have the ability to extract up to the operational yield.

The City’s various groundwater wells are aging and/or possibly threatened due to declining water quality or because of contaminants of emerging concern. The planned improvements are intended to improve #16..
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the City’s capacity and reliability of these facilities, which are an important facet of the City’s overall conjunctive use strategy.

3.3.2 Surface Water Supply
The City purchases treated surface water from the MID’s Modesto Regional Water Treatment Plant (MRWTP) during all hydrologic conditions (i.e., dry, normal, and wet years). MID has surface water rights on the Tuolumne River, which MID uses to supply some of its raw water to the MRWTP. The first phase of the MRWTP became operational in 1995 and provides the City with an annual average supply of 30 mgd (33,600 af/yr), with a functional peaking capacity of 42.5 mgd that helps meet the Maximum Day and Peak Hour demands of North Modesto. The MRWTP Phase Two Expansion Project was completed in 2016 and doubled the annual average capacity of the MRWTP to 60 mgd (67,200 af/yr). The MRWTP terminal reservoir facilities (booster pump station and tanks) and a portion of the transmission pipelines traversing the City are owned and operated by MID and the delivery of surface water is governed through an existing “Amended and Restated Water Treatment and Delivery Agreement”. #16..
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4.0 JUSTIFICATION AND COST ALLOCATION FOR PROPOSED

IMPROVEMENTS
The following recommended CIPs are necessary to meet projected demands described in the previous section and maintain safe and reliable water service to existing and future customers. These CIP recommendations only identify improvements at a master plan level and do not constitute a design of such improvements. Subsequent detailed design is required to determine the exact sizes, locations, and costs of the proposed improvements. Each recommendation is grouped into one of twenty-one CIP categories based on project type. CIP categories and cost allocations are shown in Table 1.

Costs allocated to existing customers are for those improvements necessary to safely and reliably serve existing customers. Costs allocated to future customers are for those improvements that are necessary to serve future customers after fiscal year 2021/22 and within the buildout planning horizon. The cost split between existing and future customers is clearly defined in the CIP categories based on the type of improvement or the proportionate share of demand for existing versus future customers.

The justification and cost allocation methodology for each individual project or program are described on the following pages.
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4.1 MRWTP Phase Two Expansion (Category 1)
Description
This category was used in the City’s 2016 Engineer’s Report to expand the capacity of the MRWTP from an annual average of 30 mgd to 60 mgd. Most of the costs associated with the MRWTP expansion have been expended. Costs within this category are intended to fund on-going operations and maintenance of the MRWTP, and are based on MID’s long-term maintenance projections.

Justification
Maintenance tasks include replacing filters, membranes, tanks, and pumps once they have reached the end of their useful life, as well as general system upgrades and improvements to the operations building.

These periodic updates ensure the MRWTP is kept up-to-date and able to maintain reliable water service to customers.

Cost Allocation
The cost allocation for existing and future customers for MRWTP maintenance is based on the proportionate share of demands for existing and future customers. The program is expected to require additional funds beyond the 10-year time horizon, as part of routine maintenance, but those are not yet known. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.2 City-Side Downstream Improvements related to MRWTP
Expansion (Category 2)
Description
This program is to provide funding for the design, construction, and rights-of-way acquisition for the Cityside downstream improvements necessary to accommodate the increased production capacity of the MRWTP Phase Two Expansion. This project first received funding under the City’s 2016 Engineer’s Report and is mostly complete. The only remaining Project is Phase II of the previously planned Yosemite Transmission Mains.

Justification
Previous studies evaluated and recommended that conveyance be constructed for the City’s contiguous service area as part of the MRWTP Phase Two Expansion. One project has not been constructed, and is still required to further integrate the MID transmission mains with the City’s distribution system. The proposed improvement will help correct low pressures currently observed during Peak Hour conditions, which will benefit existing customers. It will also help distribute the additional treated surface water and therefore benefit future customers.

Cost Allocation
The cost allocation for existing and future customers for the City-Side Downstream Improvements related to the MRWTP Phase Two Expansion project is based on the proportionate share of demands for existing and future customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.3 Improvements for South Modesto (Category 3)
Description
Since the City has opted out of the regional surface water treatment project using Turlock Irrigation District supplied water, alternative improvements are needed to increase delivery reliability to customers in South Modesto. These improvements specific to South Modesto include new and replacement distribution/transmission pipelines (related to high and low priority fire flow improvements, the strengthen and replace program, and general grid improvements), as well as water meters and a new storage tank with associated booster pump station. Most of these improvements come from recommendations made in the 2017 WMP to support existing and future customers.

Justification
These improvements are needed for the City to better meet peak demands, maintain sufficient service pressures, and better meet future storage deficiencies. Since the South Modesto service area is not completely built out, these improvements would benefit both existing and future customers.

Cost Allocation
The cost allocation is based on the proportionate share of demands for existing and future customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.4 Water Quality Related Studies (Category 4)
Description
This program provides funding for water quality related studies and activities, such as to investigate the presence of uranium and arsenic in groundwater. These studies are needed to identify cost-effective methods to manage groundwater resources for meeting the City's water supply needs.

Justification
Some of the City’s wells are out of service due to water quality concerns. Additionally, it is expected that more stringent regulations on groundwater quality in the future would require the City to shut down, replace, or provide wellhead treatment for more of its existing groundwater wells. These studies are a step in developing a plan to stabilize and manage the City’s groundwater resources.

Cost Allocation
Since these studies address existing wells needed to serve current customers, all of the cost is allocated to existing customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.5 SCADA System Upgrades (Category 5)
Description
This project implements Supervisory Control and Data Acquisition (SCADA) system upgrades to improve the City’s operation and management of the water system.

Justification
The City uses its current SCADA system to monitor and control water system facilities to maintain reliable water service to customers. Improvements to the SCADA system are needed to continue to be able to reliably monitor and control the City’s water system. In 2017, the City undertook a SCADA Upgrade Study to develop a detailed set of requirements for a future SCADA system. The City’s current SCADA system is based on HSQ MISER software and associated proprietary hardware, which has been in place for over 20 years.

Several issues have recently been identified that have prompted the City to undertake a complete overhaul of its SCADA system. These issues generally include: 1) concerns over hardware/software obsolescence; 2) increased demands for access to the SCADA system and collected data for planning and analysis; 3) desire for system functionality enhancements; 4) dependence on a single vendor for SCADA system supply/support; and 5) concerns over SCADA system support.

Cost Allocation
The total cost of the project was estimated to be approximately $18 million. This cost, however, was intended to be split with other City departments and it is estimated that the water system would fund approximately half of this project. There is likely to be on-going annual operations and maintenance costs associated with this program after it is implemented, but these costs are not included since they are not known at this time.

Since the SCADA system is used for monitoring and control of the existing system, and its need for upgrade represents an existing system deficiency, existing customers are allocated 100 percent of the cost of this project. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.6 New Corporation Yard (Category 6)
Description
This project will cover Phase 2 of the new Water Division Corporation Yard located along Litt Road. Phase 1 of construction is complete, however, several site improvements have not yet been completed, which are intended to be captured in Phase 2. Phase 2 improvement include: 1) construction/expansion of the employee parking lot; 2) construction of a new warehouse; 3) construction of material bins; 4) construction of solar canopies over the employee parking lot; 5) vehicle fuel station; and 6) vehicle car wash.

Justification
The City previously identified the need to construct a new corporation yard to replace the existing facility.

The scoping, design and construction of a new building was completed under Phase 1. The site development (as listed above) still needs to be completed under Phase 2.

Cost Allocation
Because the corporation yard supports current system operations, costs for this project are allocated to existing customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.7 Existing Tank Improvements (Category 7)
Description
This program provides funding for interior and exterior enhancements to existing water storage tanks to improve water quality, system efficiency, and prolong their useful life. The improvements are generally routine maintenance items (e.g., tank inspections, re-coating, sealing, replacement of existing appurtenances, generator platforms, etc.) as well as fall protection safety enhancements.

Justification
The goal of this program is to maintain system integrity and prolong the useful life of existing tanks via tank rehabilitation improvements.

Cost Allocation
This program is funded annually and is expected to require additional funds beyond the ten-year time horizon, as part of routine maintenance, but those are not included as part of this Report. Although future customers might receive some benefit from the maintenance of these tanks, the tanks are existing facilities and these improvements are required to help maintain existing system performance. Therefore, 100 percent of the total cost for this category is allocated to existing customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.8 Extend Water Mains Program (Category 8)
Description
This program extends water mains, on an as-needed basis, into developing areas to meet the demands of new growth, based on the recommendations identified in the 2017 WMP. Typically, this includes the installation of 12-inch diameter and larger pipelines, fire hydrants and valves, on a one-half mile grid.

Projects to complete distribution pipeline “looping” are included to improve service reliability to new water service areas.

Justification
As needed, this program includes the installation of new and/or upsized water mains that contribute to creating a distribution grid by extending or looping existing water mains to help maintain adequate system performance. These pipes will also enable the City to more efficiently integrate and distribute additional treated surface water from the MRWTP Phase Two Expansion.

Cost Allocation
This program is required to support demands from future customers. Therefore, costs are allocated entirely to future users. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.9 Strengthen and Replace Water System Program (Category 9) Description
This category includes distribution and transmission pipeline replacements for high and low priority fire flow improvements, as well as grid improvements that were recommended in the 2017 WMP. In addition, this program replaces and upgrades deficient water mains throughout the water system that have reached the end of their useful life, on an as-needed basis.

Justification
Pipelines have a finite life expectancy, and eventually corrode, leak, or otherwise fail. This program aims to replace pipelines before they reach the point of failure. This program also includes pipelines that have been identified as inadequate to meet pressures under normal operating conditions or fire flows, as identified in the 2017 WMP.

Cost Allocation
This program is intended to maintain the system’s performance by strengthening and replacing existing pipelines; therefore, all costs are allocated to existing customers. This program is anticipated to extend past the ten-year planning horizon. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.10 Install New Wells Program (Category 10)
Description
This program includes the following improvements: 1) replaces wells previously taken out of service due to water quality concerns and that are deemed unsuitable for rehabilitation; 2) replaces older, low producing wells that are reaching the end of their service life; 3) adds new wells to help alleviate low flow problems and/or maintain adequate system pressures for existing customers; and 4) provides additional capacity (13 new wells, resulting in an additional 16.8 mgd of firm supply capacity) to meet increasing demands for new growth, as recommended in the 2017 WMP. The cost of a well field improvement plan is also included.

Justification
Since one of the primary sources of supply for the City is groundwater, these new wells will help maintain or increase the groundwater supply. The program is expected to produce approximately one to two new wells every year, mainly as new supply sources for the water system. It should be noted that historically, the City has replaced fewer wells than scheduled. In addition, the City has actively been destroying wells that that have reached their useful life, and thus the City no longer has access to that capacity. With recent reductions in demands, this lost capacity has been to date inconsequential, but if demands increase (either by increased/rebounded water use patterns or growth, or both) additional wells will be required.

Cost Allocation
Costs for this program are anticipated to extend beyond this ten-year program. Costs are allocated to existing and future customers based on the currently identified number of wells for the existing system and the projected required number of wells for the buildout system. The current estimate for new wells that replace older existing wells is approximately 30 percent of the overall ten-year cost. The remaining portion, 70 percent of the total ten-year cost, is associated with new wells to support future demands.

The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.11 Wellhead Treatment Program (Category 11)
Description
This program provides funding for the design and construction of wellhead treatment or blending facilities for wells throughout the water service area that are currently off-line due to high contaminant levels or are at risk of exceeding mandated maximum contaminant levels.

Justification
The program rehabilitates existing groundwater wells that the City has shut down because of water quality concerns, but are not candidates for replacement, as defined in the Install New Wells Program (Category 10). This category thereby extends the useful life of wells and therefore reduces the need to construct more than one well per year in Category 10. This program includes evaluating various wellhead treatments and available treatment alternatives that will bring key wells back into production. Bringing as many of these wells back on-line will maintain the City’s groundwater production capacity. This program also includes funding for the purchase and installation of new chlorine analyzers and flush lines.

Cost Allocation
Funding for this program addresses existing system deficiencies and is wholly allocated to existing customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.12 Purchase and Install New Generators Program (Category 12) Description
This program provides funding to purchase and install generators for back-up power at various booster pump stations for tanks and well sites throughout the water system. Providing emergency power to these facilities during power interruptions or outages of the main grid is critical to maintaining reliable water service.

Justification
The back-up generators for these facilities improve supply reliability to meet existing demands. In addition, back-up generators for wells are recommended to provide for groundwater storage credit inlieu of construction of more costly storage tanks.

Cost Allocation
Generators are for existing facilities that are needed to support existing customers, and so all costs are allocated to existing customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.13 Water System Security Enhancements (Category 13)
Description
This program implements water system security improvements identified in the March 2003 Water System Vulnerability Assessment (VA), to comply with the Public Health Security and Bioterrorism Response Act of 2001. This program is ongoing, with several fencing installations already completed, and more fencing, security signage, and other security measures to be implemented at well and tank sites throughout the water distribution system. This program also includes implementing various Risk and Resilience Management Strategies (RRMSs) developed as part of the City’s Risk and Resilience Assessment (in compliance with the 2018 America’s Water Infrastructure Act [AWIA]) and includes periodic updates to the City’s Emergency Response Plan.

Justification
This program helps the City meet State and Federal requirements and implement the recommendations presented in the 2003 VA and identified as part of the City’s 2018 AWIA compliance.

Cost Allocation
Although future customers may benefit from these security enhancements, existing customers are allocated 100 percent of the category costs, since the improvements identified in the CIP are associated with existing system facilities. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.14 Groundwater Management Program (Category 14)
Description
This program provides funding to develop projects that are identified through the Integrated Regional Groundwater Management Plan (IRGMP) in the Modesto Groundwater Basin and the Groundwater Management Plan (GWMP) in the Turlock Groundwater Basin. The two GWMPs were developed with respective jurisdictions that share a common groundwater basin. These programs are needed to effectively manage the groundwater basin as a safe and sustainable water supply. This program is intended to fund groundwater monitoring wells that need to be constructed to support the groundwater planning efforts discussed above. In addition, planning and studies aimed at securing State grants are also included under this category.

Justification
The IRGMP and GWMP identify goals and objectives needed to effectively manage the groundwater basin(s) as a safe and sustainable water supply. Work through this program will be coordinated with other jurisdictions to implement the IRGMP and GWMP, along with periodic amendments and updates as necessary. Participation in this program will also allow the City to become eligible for grants that can be used on various groundwater related projects (e.g., recharge programs and aquifer storage and recovery wells).

Cost Allocation
The groundwater management program enhances the City’s groundwater supply, which benefits both existing and future customers. The cost allocation is based on the proportionate share of demands for existing and future customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.15 Urban Water Management Plan (Category 15)
Description
This program provides funding to develop UWMPs every five years. The program also provides funding for future water loss audits, conservation program implementation and potential future water supply assessments. This program will help ensure the reliability of the water supply and includes conservation programs, residential plumbing retrofits, recycled water implementations, and water system audits.

Justification
The City is required to comply with the Urban Water Management Planning Act and prepare an updated UWMP every five years. In addition, compliance with developing regulatory requirements centered around conservation will require additional conservation/consumption reporting.

Cost Allocation
This program benefits both existing and future customers because the UWMP is developed to assist decisions that affect existing system performance and future assured water supplies. The cost allocation is based on the proportionate share of demands for existing and future customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.16 Water Master Plan (Category 16)
Description
This program provides funding for the preparation of a system wide WMP and the completion of the associated environmental review (California Environmental Quality Act) work on a recurring basis. The WMP evaluates the hydraulic and operational performance of the City’s water system and addresses, among other items, future sources of supply, water quality issues, water demands, conjunctive use strategies, water system modeling updates, and capital improvements (for both existing and future customers).

Justification
The WMP allows the City to assess the impacts of future planned water system expansions, compare existing and planned supplies to existing and projected demands, and develop a revised capital improvement plan for both existing and future customers based on trends observed at the time.

Cost Allocation
This program benefits both existing and future customers since it addresses water system performance for both existing and future conditions. The cost allocation is based on the proportionate share of demands for existing and future customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.17 Water System Evaluations (Category 17)
Description
This program provides funding for the preparation of "as-needed" engineering studies and water system evaluations throughout the water service area. These studies and evaluations normally involve assessing and evaluating demands for proposed developments, supply capabilities, the potential loss of key groundwater production wells, capital deficiencies, regulatory impacts, environmental reviews, water supply assessments, hydraulic modeling support, and other water system related activities. These studies are smaller than a WMP and are budgeted annually. This program also includes funding for maintenance of the hydraulic modeling software and hydraulic model updates.

Justification
The City needs to conduct time-critical engineering studies and evaluations of the water system, on an ongoing basis. The City typically conducts these engineering evaluations and water system studies in response to proposed development projects, determining impacts of changes to proposed capital improvement projects, regulatory agency requirements, and to increase the City staff’s level of understanding of the entire water system between updates of the WMP and UWMP.

Cost Allocation
The purpose of this program is to conduct various time critical engineering studies and water system evaluations required for existing and future expansions. The cost allocation is based on the proportionate share of demands for existing and future customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.18 New Water Tanks (Category 18)
Description
This program provides funding for new water tanks including booster pump stations, generators for backup power, and other associated facilities. Only one project is included within the ten-year timeframe:
completion of the Grayson Tank 15 and associated booster pump station. Other storage tanks were recommended in the 2017 WMP to mitigate the future storage deficiency, associated with future demands. These projects, however, are not expected to be required within the next ten years, and therefore are not included in the ten-year cost.

Justification
Using the performance and design criteria from the 2017 WMP, storage tanks should provide sufficient storage to address the following three supply components:
 Operational Storage: 25 percent of the Maximum Day demand.  Fire Flow Storage: Meets the required fire flow for two simultaneous fire flow events (a multi-family residential fire event that is non-sprinklered, and an industrial fire event).  Emergency Storage: Average Day demand for one day.

Cost Allocation
The Grayson Tank will serve both existing and future customers. The cost allocation is based on the proportionate share of demands for existing and future customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.19 Water Meters Program (Category 19)
Description
This program is established to fund the purchase and installation of advanced metering infrastructure (AMI) for customers throughout the City’s service areas, as well as to provide funding to upgrade obsolete meters. Costs associated with the data handling and storage of the associated AMI data is also included in this program.

Justification
While the City has already implemented a metering program to convert from a flat water rate structure to a metered one, there is now a need to upgrade the overall program to an AMI program. An AMI program will improve metering technology to allow for enhanced demand tracking, management, and to identify areas more easily where there is apparent water loss. This upgrade will ultimately support the City in current and future water conservation and/or water use efficiency efforts and provide the City’s water customers with the ability to track and monitor their own water use.

Cost Allocation
Since future customers are required to have meters installed as new areas are developed, this program directly affects and benefits existing customers only. Therefore, 100 percent of these costs are allocated to existing customers. The five-year and ten-year cost allocation for improvements is summarized in Table 1. #16..
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4.20 New or Replacement Pumps (Category 21)
Description
This Program replaces deficient water pumps, on an as-needed basis, at wells and booster pump stations that are beyond their useful life and/or too costly to repair.

Justification
Similar to the need to replace aging pipeline infrastructure in the water system over time, it is also necessary to replace existing deficient water pumps at wells and booster pump stations. In particular, pumps may need replacement over time if pump efficiency decreases or if the pump experiences mechanical problems that cannot be remedied with routine maintenance.

Cost Allocation
The costs for this program are budgeted annually and since these improvements are primarily focused on maintaining existing system performance, costs are only allocated to existing customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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4.21 Utility Cuts Program (Category 22)
Description
This program funds pavement repairs related to utility construction activities, such as the installation of water lines, valve replacement, water connections, and leak repairs.

Justification
The City maintains this program to cover costs beyond funds included as part of the Strengthen and Replace Water System Program (Category 9).

Cost Allocation
Utility cuts are required for existing pavement repairs which will benefit existing customers; therefore, 100 percent of the costs are allocated to existing customers. Costs for this program are anticipated to extend beyond this ten-year program. The five-year and ten-year cost allocation for improvements is summarized in Table 1.
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5.0 PROJECT SCHEDULE AND COST PROJECTIONS
The proposed CIP expenditures by year are summarized in Table 2. Table 2 shows the anticipated cost per fiscal year for each of the CIP projects, and the total cost for each fiscal year. Costs shown in Table 2 are escalated 4 percent annually to the year of planned construction. #16..
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Table 2. Proposed Ten-Year Water System Capital Improvement Program Expenditures by Year(a) Category
No. Category FY 2022/23 FY 2023/24 FY 2024/25 FY 2025/26 FY 2026/27 FY 2027/28 FY 2028/29 FY 2029/30 FY 2030/31 FY 2031/32 5 Year Total 10 Year Total 1 MRWTP Phase Two
Expansion $1,280,600 $1,981,500 $1,733,500 $1,268,300 $4,468,500 $4,574,500 $5,459,100 $1,718,400 $4,015,100 $1,023,500 $10,732,400 $27,523,000 2 City-Side Downstream
Improvements related
to MRWTP Expansion
$862,900 $3,111,000 $3,608,800 $388,300 $0 $0 $0 $0 $0 $0 $7,971,000 $7,971,000 3 Improvements for
South Modesto $3,221,500 $4,546,800 $2,208,800 $97,100 $0 $1,606,900 $6,490,200 $4,709,300 $4,180,400 $3,872,700 $10,074,200 $30,933,700 4 Water Quality Related
Studies $23,100 $24,000 $25,600 $27,900 $30,300 $32,900 $35,700 $38,700 $41,800 $45,100 $130,900 $325,100 5 SCADA System
Upgrades $650,000 $1,300,000 $1,300,000 $2,599,000 $2,599,000 $650,000 $65,000 $65,000 $65,000 $65,000 $8,448,000 $9,358,000 6 New Corporation Yard $0 $12,000 $311,100 $4,270,800 $4,441,600 $699,900 $72,800 $75,700 $78,800 $81,900 $9,035,500 $10,044,600 7 Existing Tank
Improvements $3,969,300 $514,600 $547,600 $1,210,100 $1,534,400 $14,000 $1,565,000 $1,612,400 $3,322,300 $1,719,400 $7,776,000 $16,009,100 8 Extend Water Mains $201,400 $658,100 $246,400 $621,200 $767,200 $699,900 $727,900 $757,000 $787,300 $818,800 $2,494,300 $6,285,200 9 Strengthen and Replace
Water System $12,613,000 $12,833,900 $15,426,600 $15,998,300 $12,187,400 $26,745,000 $23,653,600 $29,577,000 $22,513,600 $25,737,200 $69,059,200 $197,285,600 10 Install New Wells $6,770,800 $5,545,900 $4,598,000 $5,603,800 $6,467,200 $5,599,100 $6,550,900 $7,570,000 $8,660,000 $9,825,200 $28,985,700 $67,190,900 11 Wellhead Treatment $3,238,700 $2,117,900 $2,849,700 $2,976,300 $2,355,100 $2,463,300 $2,576,700 $2,695,700 $2,820,400 $2,951,300 $13,537,700 $27,045,100 12 Purchase & Install New
Generators $28,800 $329,100 $311,100 $1,100,100 $774,000 $804,900 $837,100 $870,600 $905,400 $941,600 $2,543,100 $6,902,700 13 Water System Security
Enhancements $143,900 $59,900 $62,300 $90,600 $201,900 $70,000 $72,800 $75,700 $110,300 $245,700 $558,600 $1,133,100 14 Groundwater
Management Program $69,100 $1,017,100 $597,400 $0 $471,100 $42,000 $0 $529,900 $47,300 $0 $2,154,700 $2,773,900 15 Urban Water
Management Plan $115,100 $30,000 $31,200 $32,400 $175,000 $35,000 $36,400 $37,900 $39,400 $212,900 $383,700 $745,300 16 Water Master Plan $10,904 $0 $0 $64,800 $403,800 $0 $0 $0 $78,800 $655,100 $479,504 $1,213,404 17 Water System
Evaluation $589,700 $618,100 $135,100 $146,300 $158,900 $172,200 $186,400 $202,200 $218,900 $237,500 $1,648,100 $2,665,300 18 New Water Tanks $0 $89,800 $1,306,700 $1,358,900 $1,413,300 $0 $0 $0 $0 $0 $4,168,700 $4,168,700 19 Water Meters(c) $0 $0 $13,293,000 $12,356,600 $13,102,700 $13,894,200 $14,733,900 $95,200 $107,900 $109,500 $38,752,300 $67,693,000 21 New or Replacement
Pumps $0 $0 $248,900 $258,900 $67,300 $72,800 $78,700 $84,800 $91,400 $98,300 $575,100 $1,001,100 22 Utility Cuts $172,600 $179,500 $186,700 $194,200 $201,900 $210,000 $218,400 $227,100 $236,200 $245,700 $934,900 $2,072,300 Total $33,961,404 $34,969,200 $49,028,500 $50,663,900 $51,820,600 $58,386,600 $63,360,600 $50,942,600 $48,320,300 $48,886,400 $220,443,604 $490,340,104 (a) Costs based on September 2022 San Francisco Engineering News Record (ENR) Construction Cost Index (CCI) (15083.26) and Costs are escalated by 4% annually to the year of planned construction. (b) While some Categories show zero remaining costs, there will be costs beyond the ten-year plan horizon (e.g., Categories 7, 9, 14, 15, 16, 19, etc.). (c) Updated capital costs for Water Meters provided by City staff on April 13, 2023.

N-C-418-60-20-65-E-CIP_DATABASE
City of Modesto
2022 Engineer's Report
Last Revised: 04-14-23
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CITY OF MODESTO

WATER RATE STUDY REPORT
June 26, 2023
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2625 Alcatraz Ave, #602
Berkeley, CA 94705
Tel 510 653 3399
www.bartlewells.com
July 25, 2023

Utilities Department, City of Modesto
1010 Tenth Street, 4th Floor, Suite 4600
Modesto, CA 95354
Attention: William Wong, Director of Utilities
Re: Water Rate Study
Bartle Wells Associates is pleased to submit to the City of Modesto the attached Water Rate Study. The study presents BWA’s analysis of the operating and non-operating expenses of the City’s water system and provides a five-year cash flow projection. The primary purpose of this study was to analyze the City’s water enterprise and make recommendations that would achieve financial sustainability. Another important purpose of this study was to review rates to ensure that they adhere to the State’s legal requirements.

BWA finds that the rates and charges proposed in our report reflect the cost-of-service for each customer, follow generally accepted rate design criteria, and adhere to the substantive requirements of Proposition 218. BWA believes the proposed rates are fair and reasonable to the City’s customers.

Please contact us with any future questions about this study and the recommended water rates.

Sincerely,

Douglas Dove, PE, CIPMA Erik Helgeson, MBA
Principal/ President Vice President
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Contents
1 Executive summary .................................................................................... 1

1.1 Introduction .......................................................................................................................... 1

1.2 Rate Study Objectives .............................................................................................................. 1

1.3 Cash Flow Projection Scenarios................................................................................................ 2

1.4 Water Rate Recommendations per Scenario ............................................................................ 2 2 Background, Objectives, and Legal Requirements........................................ 5

2.1 Rate Study Objectives .............................................................................................................. 5

2.2 Rate-Study Process .................................................................................................................. 6

2.3 Constitutional Requirements for Rates..................................................................................... 6

2.3.1 Article 13D, Section 6............................................................................................................... 6

2.3.2 Article 10, Section 2 ................................................................................................................. 7

2.4 Statute of Limitations............................................................................................................... 7 3 Projected Water Demand and Customer Characteristics .............................. 8

3.1 Projected Water Demand......................................................................................................... 8

3.2 Water Services and Equivalent Capacity................................................................................... 8 4 Water Financial Plan..................................................................................10

4.1 Water Financial Overview ......................................................................................................10

4.2 Key Drivers of Rate Increases................................................................................................. 10

4.3 Financial Plan Assumptions....................................................................................................11

4.4 Cash Flow Projections............................................................................................................11

4.5 Cash Flow Projection Scenarios..............................................................................................12

4.6 Cash Flow Projection for Scenario 1 - Low Capital, No Debt....................................................12

4.7 Cash Flow Projection for Scenario 2 - Full Capital with New Debt ...........................................15

4.8 Cash Flow Projection for Scenario 3 - Full Capital, No Debt.....................................................18

4.9 Scenario Projected Cashflow Comparison ..............................................................................21 5 Cost-of-Service Rate Derivation ................................................................. 22

5.1 Functional Allocation .............................................................................................................23

5.2 Rate Derivation......................................................................................................................25

5.3 Proposed Water Rates ...........................................................................................................27 6 Regional Residential Bill Comparison .........................................................30 #16..
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7 Drought Rates...........................................................................................31 8 Conclusion and Recommendations.............................................................33

8.1 Conclusion ........................................................................................................................33

8.2 Recommendations.................................................................................................................33 The full set of tables from the rate study model is available for review at the City of Modesto Utilities Department office located at 1010 10th Street, 4th Floor, Modesto, CA 95354. #16..
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LIST OF TABLES
Table 1 – Proposed Scenario 1 Water Rates........................................................................................................ 2 Table 2 – Proposed Scenario 2 Water Rates........................................................................................................ 3 Table 3 – Proposed Scenario 3 Water Rates........................................................................................................ 4 Table 4 – Historic and Projected Potable Supply and Metered Demand ............................................................. 8 Table 5 – Water Services and Meter Equivalent Units......................................................................................... 9 Table 6 – Scenario 1 Cash Flow Projection Summary ........................................................................................ 12 Table 7 – Scenario 1 Detailed Cash Flow Projections......................................................................................... 14 Table 8 – Scenario 2 Cash Flow Projection Summary ........................................................................................ 15 Table 9 – Scenario 2 Detailed Cash Flow Projections......................................................................................... 17 Table 10 – Scenario 3 Cash Flow Projection Summary ...................................................................................... 18 Table 11 – Scenario 3 Detailed Cash Flow Projections....................................................................................... 20 Table 12 – Scenario Projected Cashflow Comparison........................................................................................ 21 Table 13 – Scenario 1 Functional Allocation...................................................................................................... 24 Table 14 – Scenario 2 Functional Allocation...................................................................................................... 24 Table 15 – Scenario 3 Functional Allocation...................................................................................................... 24 Table 16 – Scenario 1 Rate Derivation............................................................................................................... 25 Table 17 – Scenario 2 Rate Derivation............................................................................................................... 26 Table 18 – Scenario 3 Rate Derivation............................................................................................................... 26 Table 19 – Proposed Scenario 1 Water Rates.................................................................................................... 27 Table 20 – Proposed Scenario 2 Water Rates.................................................................................................... 28 Table 21 – Proposed Scenario 3 Water Rates.................................................................................................... 29 Table 22 – Proposed Scenario 1 Drought Rates................................................................................................. 31 Table 23 – Proposed Scenario 2 Drought Rates................................................................................................. 32 Table 24 – Proposed Scenario 3 Drought Rates................................................................................................. 32

LIST OF FIGURES
Figure 1 – Cost-of-Service Rate Study Process..................................................................................................... 6 Figure 2 – Scenario 1 Projected Cashflow Graph............................................................................................... 13 Figure 3 – Scenario 2 Projected Cashflow Graph............................................................................................... 16 Figure 4 – Scenario 3 Projected Cashflow Graph............................................................................................... 19 Figure 5 – Residential Bill Comparison .............................................................................................................. 30 #16..
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BARTLE WELLS ASSOCIATES 1
City of Modesto – Water Rate Study 2023
1 EXECUTIVE SUMMARY

1.1 Introduction
The City of Modesto provides water service to over 74,000 accounts throughout the City of Modesto, Salida, Empire, Grayson, Del Rio, and portions of Ceres (Walnut Manor) and Turlock. The City of Modesto’s water sources are groundwater and treated surface water purchased from the Modesto Irrigation District.

The revenues from the City’s water utility are primarily derived from charges for services. The City must establish rates and charges adequate to fund the cost of providing water services, which includes costs for operations and maintenance, as well as capital improvements needed to keep the City’s utility infrastructure in a safe and reliable operating condition.

The City has provided proactive financial stewardship by raising rates to keep revenues in line with the costs of providing water service. Those rate increases have enabled the City to maintain its financial health.

The City’s water utility is a financially self-supporting enterprise, where revenues are derived primarily from water service charges. As such, the City’s water rates must be set at adequate levels to fund the costs of providing service and:
• Fund ongoing operating and maintenance expenses
• Address regulatory requirements
• Fund the capital improvement projects, related debt service, and associated increased operating costs • Provide funding for water system maintenance and upgrades The prior water rate increases strengthened the financial condition of the water enterprise. However, current rates are not adequate to fund the needed improvements and meet regulatory water quality and supply requirements.

1.2 Rate Study Objectives
The City has historically adopted rate increases in order to keep revenues in line with the escalating costs of providing service. Therefore, in 2020, the City retained BWA to develop a cost-of-service based water rate study.

Key goals and objectives of this study include developing water rates that:
• Recover the costs of providing service, including operating, capital, and debt funding needs; • Are proportionate, fair, and equitable to all customers; • Are easy to understand and implement;
• Comply with the substantive requirements of the California Constitution, Article 13D, Section 6 (which was adopted by the voters as Proposition 218 in 1996) and the general mandate of Article 10, Section 2 that prohibits the wasteful use of water;
• Support the long-term operational and financial stability of the City. #16..
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BARTLE WELLS ASSOCIATES 2
City of Modesto – Water Rate Study 2023
BWA worked closely with City staff to incorporate information and input, evaluate alternatives, and develop recommendations. This report summarizes key findings and recommendations for water rates over the next five years.

1.3 Cash Flow Projection Scenarios
This report explores the financial plan and rates for three different capital scenarios which are as follows:
• Scenario 1 - Low Capital, No Debt. This scenario projects inflation adjusted capital spending to total $138 million over the next five years, of which all will be cash funded; resulting in an average cash expense of $27.6 million per year.
• Scenario 2 - Full Capital with Debt. This scenario projects inflation adjusted capital spending to total $185 million over the next five years, of which $145 million will be cash funded; resulting in an average cash expense of $29 million per year. The remaining $40 million is projected to be debt financed. • Scenario 3 - Full Capital, No Debt. This scenario projects inflation adjusted capital spending to total $185 million over the next five years, of which all will be cash funded; resulting in an average cash expense of $37 million per year.

1.4 Water Rate Recommendations per Scenario
The following tables show the recommended water rates for each scenario.

Table 1 – Proposed Scenario 1 Water Rates
Current and Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates n/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF) $2.02 $2.11 $2.20 $2.30 $2.40 $2.51
Drought ($/CCF) n/a $2.45 $2.56 $2.68 $2.80 $2.93
Monthly Fixed Charge n/a n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.48 $27.67 $28.92 $30.22 $31.58
3/4" $25.44 $26.48 $27.67 $28.92 $30.22 $31.58
1" $36.83 $38.56 $40.30 $42.11 $44.00 $45.98

1.5" $65.32 $68.74 $71.83 $75.06 $78.44 $81.97
2" $99.50 $104.96 $109.68 $114.62 $119.78 $125.17
3" $207.73 $219.66 $229.54 $239.87 $250.66 $261.94
4" $367.24 $388.68 $406.17 $424.45 $443.55 $463.51
6" $748.90 $793.14 $828.83 $866.13 $905.11 $945.84
8" $1,375.53 $1,457.17 $1,522.74 $1,591.26 $1,662.87 $1,737.70 10" $2,173.05 $2,302.31 $2,405.91 $2,514.18 $2,627.32 $2,745.55 12" $2,856.63 $3,026.71 $3,162.91 $3,305.24 $3,453.98 $3,609.41 #16..
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City of Modesto – Water Rate Study 2023
Table 2 – Proposed Scenario 2 Water Rates
Current and Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates n/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF) $2.02 $2.11 $2.20 $2.30 $2.40 $2.51
Drought ($/CCF) n/a $2.45 $2.56 $2.68 $2.80 $2.93
Monthly Fixed Charge n/a n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
3/4" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
1" $36.83 $38.55 $40.28 $42.09 $43.98 $45.96

1.5" $65.32 $68.85 $71.95 $75.19 $78.57 $82.11
2" $99.50 $105.21 $109.94 $114.89 $120.06 $125.46
3" $207.73 $220.35 $230.27 $240.63 $251.46 $262.78
4" $367.24 $390.03 $407.58 $425.92 $445.09 $465.12
6" $748.90 $796.05 $831.87 $869.30 $908.42 $949.30
8" $1,375.53 $1,462.65 $1,528.47 $1,597.25 $1,669.13 $1,744.24 10" $2,173.05 $2,311.05 $2,415.05 $2,523.73 $2,637.30 $2,755.98 12" $2,856.63 $3,038.25 $3,174.97 $3,317.84 $3,467.14 $3,623.16 #16..
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City of Modesto – Water Rate Study 2023
Table 3 – Proposed Scenario 3 Water Rates
Current and Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates n/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF) $2.02 $2.14 $2.28 $2.43 $2.59 $2.76
Drought ($/CCF) n/a $2.49 $2.65 $2.82 $3.00 $3.20
Monthly Fixed Charge n/a n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.76 $28.50 $30.35 $32.32 $34.42
3/4" $25.44 $26.76 $28.50 $30.35 $32.32 $34.42
1" $36.83 $39.40 $41.96 $44.69 $47.59 $50.68

1.5" $65.32 $70.98 $75.59 $80.50 $85.73 $91.30
2" $99.50 $108.88 $115.96 $123.50 $131.53 $140.08
3" $207.73 $228.90 $243.78 $259.63 $276.51 $294.48
4" $367.24 $405.76 $432.13 $460.22 $490.13 $521.99
6" $748.90 $828.98 $882.86 $940.25 $1,001.37 $1,066.46
8" $1,375.53 $1,523.81 $1,622.86 $1,728.35 $1,840.69 $1,960.33 10" $2,173.05 $2,408.15 $2,564.68 $2,731.38 $2,908.92 $3,098.00 12" $2,856.63 $3,166.15 $3,371.95 $3,591.13 $3,824.55 $4,073.15 #16..
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2 BACKGROUND, OBJECTIVES, AND LEGAL REQUIREMENTS
The City of Modesto provides water service to over 74,000 accounts throughout the City of Modesto, Salida, Empire, Grayson, Del Rio, and portions of Ceres (Walnut Manor) and Turlock. The City sold the water system serving Hickman and Waterford to the City of Waterford in 2015. The City of Modesto’s water sources are groundwater and treated surface water purchased from the Modesto Irrigation District.

The revenues from the City’s water utility are primarily derived from charges for services. The City must establish rates and charges adequate to fund the cost of providing waterservices, including costs for operations and capital improvements needed to keep the City’s utility infrastructure in a safe and reliable operating condition.

The City has provided proactive financial stewardship by raising rates to keep revenues in line with the costs of providing water service. Those rate increases have enabled the City to maintain its financial health.

The City’s water utility is a financially self-supporting enterprise. Revenues are derived primarily from water service charges. As such, the City’s water rates must be set at adequate levels to fund the costs of providing service and:
• Fund ongoing operating and maintenance expenses
• Address regulatory requirements
• Fund the capital improvement projects, related debt service and associated increased operating costs • Provide funding for water system maintenance and upgrades The prior water rate increases strengthened the financial condition of the water enterprise. However, current rates are not adequate to fund the needed improvements and meet regulatory water quality and supply requirements.

2.1 Rate Study Objectives
In 2020, the City retained BWA to develop a cost-of-service based water rate study. The City has historically adopted rate increases in order to keep revenues in line with the escalating costs of providing service. Key goals and objectives of this study include developing water rates that:
• Recover the costs of providing service, including operating, capital, and debt funding needs; • Are proportionate, fair and equitable to all customers; • Are easy to understand and implement;
• Comply with the substantive requirements of the California Constitution, Article 13D, Section 6 (which was adopted by the voters as Proposition 218 in 1996) and the general mandate of Article 10, Section 2 that prohibits the wasteful use of water;
• Support the long-term operational and financial stability of the City both in normal and drought conditions.
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2.2 Rate-Study Process
The general process used for this cost-of-service rate study is summarized in the following diagram.

Figure 1 – Cost-of-Service Rate Study Process
Key elements of the study include:
1) Project Initiation and Data Collection – Review financial policies; collect financial and other relevant data; and review rate structures;
2) Demand Analysis – Analyze past water demands and customer characteristics to forecast future demands; 3) Long Range Financial Plans – Develop financial projections to evaluate annual revenue requirements from rates and the overall level of rate increases needed to fund the costs of providing service and support longterm financial stability; 4) Cost Allocation – Group the City’s costs in terms of the function they serve as a basis to proportionally allocate the revenue requirement from rates;
5) Cost-of-Service Rate Design – Develop rates that proportionately recover costs; and 6) Prop 218 Process – Ensure compliance with the substantive and procedural requirements of Proposition 218.

2.3 Constitutional Requirements for Rates
The water rates proposed in this report are designed to comply with two key articles of the California Constitution:

Article 13D and Article 10, as explained below.

2.3.1 Article 13D, Section 6
Proposition 218 was adopted by California voters in 1996 and added Articles 13C and 13D to the California Constitution. Article 13D, Section 6 governs property-related charges, which the California Supreme Court has ruled, includes rates imposed for water delivered through pipes connected to property. Article 13D, Section 6 establishes both a) procedural requirements for imposing or increasing property-related charges, and b) Project
Initiation
and Data
Collection
Demand
Analysis
LongRange
Financial
Plan
Cost
Allocation
Rate
Design
Prop. 218
Process
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substantive requirements for those charges. Article 13D requires voter approval for new or increased propertyrelated charges but exempts rates for water, wastewater, and garbage service from this voting requirement if rates are adopted by the appropriate procedure and meet the substantive requirements. This report recommends water rates designed to comply with the substantive requirements of Proposition 218.

The substantive requirements of Article 13D, section 6 require property-related charges, such as the City’s water rates, to meet the following conditions:
1) Revenues derived from the fee or charge shall not exceed the costs required to provide the propertyrelated service. 2) Revenues derived from the fee or charge shall not be used for any purpose other than that for which the fee or charge was imposed.
3) The amount of a fee or charge imposed upon any parcel or person as an incident of property ownership shall not exceed the proportional cost of the service attributable to the parcel. 4) No fee or charge may be imposed for a service unless that service is used by, or immediately available to the property in question.
5) No fee or charge may be imposed for general governmental services, such as police or fire services, where the service is available to the public at large in substantially the same manner as it is to property owners.

2.3.2 Article 10, Section 2
Article 10, Section 2 of the California Constitution states that:

It is hereby declared that because of the conditions prevailing in this State the general welfare requires that the water resources of the State be put to beneficial use to the fullest extent of which they are capable, and that the waste or unreasonable use or unreasonable method of use of water be prevented, and that the conservation of such waters is to be exercised with a view to the reasonable and beneficial use thereof in the interest of the people and for the public welfare.

2.4 Statute of Limitations
Pursuant to California Government Code 53759, there is a 120-day statute of limitations for challenging any new, increased, or extended fees. This statute of limitations applies to the water rates proposed in this rate study and is included in the Proposition 218 Notice.
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3 PROJECTED WATER DEMAND AND CUSTOMER CHARACTERISTICS

3.1 Projected Water Demand
Projected FY 23/24 water demand is based on the average metered demand for the last five fully recorded years.

Table 4 – Historic and Projected Potable Supply and Metered Demand Customer Data FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 n/a Actual Actual Actual Actual Actual Projected Projected System Totals n/a n/a n/a n/a n/a n/a n/a
Total Accounts (#) 73,469 73,629 73,833 74,137 74,413 74,560 74,707 Growth (%) n/a 0.22% 0.28% 0.41% 0.37% 0.20% 0.20%
Annual metered use
(CCF) per meter 278 265 277 288 279 277 277
Annual production
(CCF) per account 298 285 303 309 298 299 299
Billed, Metered
Consumption (CCF) 18,639,728 18,222,157 19,509,688 20,697,851 20,568,355 20,562,541 20,693,839 Total Estimated
Consumption (CCF) 20,710,040 19,789,661 20,643,245 21,464,258 20,796,593 20,676,660 20,693,839 Total Water
Production (CCF) 21,919,447 20,965,305 22,397,473 22,916,498 22,203,522 22,277,633 22,328,428 Source: Actual water supply, water loss, and metered water sales provided by the City.

3.2 Water Services and Equivalent Capacity
Each connection to the City’s water system is considered one service. Some of the City's fixed costs are reasonably recovered on a per-customer basis, while others should be recovered based on the capacity required to serve each customer. The size of a customer’s meter reflects the demand they require of the water system’s capacity.

A significant percentage of the costs of any water system is related to its requirement to deliver water to any customer instantaneously at any time, up to the maximum safe flow capacity of a customer’s meter. Simply put, as the size of a customer’s water meter increases, the instantaneous demand it can place on the City’s water system increases.

Fixed charges for each meter size are based on the capacity of a meter, relative to the capacity of smallest meter size (e.g., a 3/4-inch meter), in the City’s system. In this study, the relative capacity of a meter size, referred to as a meter equivalent ratio (MEU), is calculated by dividing the capacity of a given meter size by the capacity of a 3/4” meter. The meter equivalent ratios used are proportional to the maximum safe flow of a 3/4" meter. The sum of all MEU’s reflects the total capacity of the City. #16..
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The following table contains the counts of water services and calculations of meter equivalent units. Total meter equivalent units for each meter size are derived by multiplying the meter equivalent ratio by the number of services at each meter size.

Table 5 – Water Services and Meter Equivalent Units
Meter Size* Services
Meter
Equivalent
Ratio**
Meter
Equivalent
Units
Annual Meter
Equivalent
Units
5/8" 87 1.0 87.0 1,044.0
3/4" 13,459 1.0 13,459.0 161,508.0
1" 57,153 1.7 95,255.0 1,143,060.0

1.5" 1,168 3.3 3,893.3 46,720.0
2" 2,176 5.3 11,605.3 139,264.0
3" 158 11.7 1,843.3 22,120.0
4" 289 21.0 6,069.0 72,828.0
6" 141 43.3 6,110.0 73,320.0
8" 64 80.0 5,120.0 61,440.0
10" 11 126.7 1,393.3 16,720.0
12" 1 166.7 166.7 2,000.0
Total 74,707.0 n/a 145,002.0 1,740,024.0
* Customer data as of June 2022 provided by staff
** Capacity factors based on AWWA operating capacity standards by meter size #16..
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4 WATER FINANCIAL PLAN

4.1 Water Financial Overview
BWA conducted an independent evaluation of water enterprise finances and concluded the previous rate increases have put the water enterprise in a sound financial position. Continual, gradual increases are projected to maintain its strong financial position where operating reserves exceed six months of operating costs and the debt service coverage ratio exceeds the target of 2.0.

The City relies almost solely on revenues from water rates to fund the costs of providing service. As such, water rates must be set at levels adequate to fund the costs of operating and maintaining the water system, fund necessary capital improvements to keep the water system in good operating condition, and meet the City’s financial policies.

4.2 Key Drivers of Rate Increases
The City is facing several manageable financial challenges that will drive the need for rate increases in upcoming years. Key drivers of future rate increases are summarized below.

Capital Improvement Funding Needs
The City takes a proactive approach to maintaining its water system, which requires ongoing repair and improvement projects. This report explores the financial plan and rates for three different capital scenarios which are described in Section 4.5.

Ongoing Operating Cost Inflation
The City faces annual cost inflation due to annual increases in a range of expenses including staffing, utilities, insurance, supplies, etc. On top of rate increases needed for capital improvements, annual rate increases are needed to keep revenues aligned with cost inflation and prevent rates from falling behind the cost of providing service. Water cost inflation has historically been higher than the Consumer Price Index (CPI) for consumer goods and services. Historically inflation has typically remained consistently around 3%, but recently inflation has reached forty-year highs with the CPI and ENR CCI exceeding 7% in 2022. It is not expected that inflation will remain at such high levels in the future and for the purposes of this rate study average annual inflation is projected to be 5%; in-line with the City’s budget inflationary projections.

Water Reserve Funds
Maintaining a prudent minimal level of fund reserves provides a financial cushion for dealing with unanticipated expenses, revenue shortfalls, and non-catastrophic emergency capital repairs. The City’s financial reserve policies include a minimum reserve target equal to 25% of its operating costs. BWA developed a financial plan designed to maintain prudent reserve levels that are in-line with water utility industry standards.

Debt Service Coverage
Most municipal debt requires that the issuer generate net operating revenues of 1.25 times the total annual debt service payment or greater. This is referred to as “debt service coverage”. To support a strong credit rating and #16..
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good financial health, the current City policy requires a debt coverage ratio of 1.5 times the annual payment or greater, and the City’s financial advisors recommend a debt coverage ratio of 2.0.

4.3 Financial Plan Assumptions
The financial projections incorporate the latest information available and a number of reasonable and slightly conservative assumptions for planning purposes. Key assumptions include:

Revenue Assumptions
• Water rate revenues are based on estimated revenues for the current fiscal year. • Rates proposed to be adopted in August 2023 will be effective on October 1, 2023, with rate adjustments planned to become effective on October 1 of each of the subsequent four years. • Water sales revenues are based on the projected volume of water sales and projected water rates. • The City is anticipating minimal growth. To be conservative and ensure revenues will be sufficient, BWA assumed 0.2% annual growth based on the lowest annual growth over the past five years. • Interest earnings are projected based on the annual beginning fund balance multiplied by the projected interest rate. The interest rate projections are based on recent and anticipated interest rates. • Discretionary “non-rate” revenues which support rate assistance programs, such as the low-income and medical disability waiver programs, were not included in projected revenues.

Expense Assumptions
• Operating and maintenance costs are primarily based on the 2022/23 budget. • Operating costs are projected to escalate at 5% per year to account for cost inflation. • Debt service projections are based on outstanding debt schedules and projected issuances of new debt. • Capital improvement costs are based on the most recent engineering cost estimates. Capital costs include a 5% annual construction cost inflation factor for the next five years.

4.4 Cash Flow Projections
Long-term cash-flow projections were developed based on assumptions and key drivers of future rate increases described above. The projections were used to determine the water utility’s annual revenue requirements and project required water rate revenue increases. The long-term cash-flow projections incorporate the latest information available from the City’s budget, annual reports, capital spending projections, and metered water demand data, as well as a number of reasonable assumptions developed with input from the City. The overall rate revenue increases shown for each of the following scenarios are designed to fund the City’s cost of providing service, maintain roughly balanced budgets, maintain healthy debt service coverage, and maintain prudent reserves. The projections indicate the need for increases for water rate revenues for each of the next five fiscal years. Actual impacts to customers’ water bills will vary based on meter size and water use, due to the outcome of the updated cost-of-service analysis.
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4.5 Cash Flow Projection Scenarios
This report explores the financial plan and rates for three different capital scenarios which are as follows:
• Scenario 1 - Low Capital, No Debt. This scenario projects inflation adjusted capital spending to total $138 million over the next five years, of which all will be cash funded; resulting in an average cash expense of $27.6 million per year.
• Scenario 2 - Full Capital with Debt. This scenario projects inflation adjusted capital spending to total $185 million over the next five years, of which $145 million will be cash funded; resulting in an average cash expense of $29 million per year. The remaining $40 million is projected to be debt financed. • Scenario 3 - Full Capital, No Debt. This scenario projects inflation adjusted capital spending to total $185 million over the next five years, of which all will be cash funded; resulting in an average cash expense of $37 million per year.

4.6 Cash Flow Projection for Scenario 1 - Low Capital, No Debt In future years, the City can re-evaluate its finances and revenue requirements and adjust rates as needed based on updated projections. However, while the City always has the flexibility to implement rate adjustments that are lower than adopted pursuant to Proposition 218, future rates cannot exceed adopted increases without going through the Proposition 218 process again. Rates adopted pursuant to Proposition 218 are essentially future rate caps.

A summary of the key elements of the long-term cash-flow projections for this scenario is displayed in the following table.

Table 6 – Scenario 1 Cash Flow Projection Summary
Scenario 1 - Low
Capital, No Debt FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Debt Funded Capital $0 $0 $0 $0 $0
Cash Funded Capital $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 Total Capital $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 Ending Reserves $102,018,732 $97,794,035 $91,442,474 $83,322,765 $73,390,177 Rate Revenue
Increase 4.5% 4.5% 4.5% 4.5% 4.5%
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The following figure visually depicts the cash-flow projections with the proposed rate increases for the next five years. Projected expenses are summarized into key categories. The figure also shows the projected fund reserves at the end of each fiscal year.

Figure 2 – Scenario 1 Projected Cashflow Graph
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
$140.0
FY 22-23 FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28
Rate Funded Capital
Debt Service
O&M
Revenue
Reserves
City of Modesto
Projected Water Revenues & Expenses ($ Millions)
Scenario 1 - Low Capital, No Debt
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Detailed, long-term, cash-flow projections for this scenario are shown in the following table.

Table 7 – Scenario 1 Detailed Cash Flow Projections
Projected Cashflow FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Rate Revenue Increase 4.5% 4.5% 4.5% 4.5% 4.5%
Beginning Reserves $110,862,007 $102,018,732 $97,794,035 $91,442,474 $83,322,765 Revenues n/a n/a n/a n/a n/a
Rate Revenue $79,021,999 $82,743,145 $86,639,520 $90,719,375 $94,991,350 Rate Increase Revenue 3,555,990 3,723,442 3,898,778 4,082,372 4,274,611 Timing Adjustment* -592,665 0 0 0 0
Other Revenue 4,650,665 4,559,418 4,543,198 4,518,473 4,486,676 Interest on Reserves $443,448 $408,075 $391,176 $365,770 $333,291 ________ ________ ________ ________ ________ ________
Total Revenue $87,079,437 $91,434,079 $95,472,672 $99,685,989 $104,085,928 Expenses n/a n/a n/a n/a n/a
Operating Expenses $58,312,292 $59,483,407 $62,419,327 $65,502,043 $68,738,895 Existing Debt Service 11,985,419 12,685,819 12,685,819 12,685,820 12,685,821 New Debt Service 0 0 0 0 0
Rate Funded Capital $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 ________ ________ ________ ________ ________ ________
Total Expenses $95,922,711 $95,658,776 $101,824,234 $107,805,699 $114,018,516 Net Revenues -$8,843,274 -$4,224,697 -$6,351,561 -$8,119,709 -$9,932,588 Ending Reserves $102,018,732 $97,794,035 $91,442,474 $83,322,765 $73,390,177 Debt Coverage (Target 2.0) 2.40 2.52 2.61 2.69 2.79
*Reflects October rate implementation
Capital Funding FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Capital Revenues n/a n/a n/a n/a n/a
Use of Debt Proceeds $0 $0 $0 $0 $0
Rate Funded Capital $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 ________ ________ ________ ________ ________ ________
Total Capital Revenue $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 Total Capital
Expenditures $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 #16..
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4.7 Cash Flow Projection for Scenario 2 - Full Capital with New Debt In future years, the City can re-evaluate its finances and revenue requirements and adjust rates as needed based on updated projections. However, while the City always has the flexibility to implement rate adjustments that are lower than adopted pursuant to Proposition 218, future rates cannot exceed adopted increases without going through the Proposition 218 process again. Rates adopted pursuant to Proposition 218 are essentially future rate caps.

A summary of the key elements of the long-term cash-flow projections for this scenario is displayed in the following table. This scenario utilizes debt in FY 26-27 and FY 27-28 to stabilize reserves, which allows more capital to be funded in this scenario than Scenario 1 with the same rate increases. This scenario demonstrates that 4.5% increases are sufficient under low and full capital scenarios. The impact of utilizing debt is potentially needing average annual rate increasesin years FY 28-29 through FY 32-33 of 6.4% rather than the projected average annual rate increases in Scenario 1 of 5.5%. It is important to keep in mind projections more than five years out are conservative and do not include grants and capital construction slowdowns.

Table 8 – Scenario 2 Cash Flow Projection Summary
Scenario 2 - Full Capital
with New Debt FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Debt Funded Capital $0 $0 $0 $20,000,000 $20,000,000
Cash Funded Capital $25,625,000 $37,591,025 $37,937,002 $19,547,379 $24,194,205 Total Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Ending Reserves $102,018,732 $83,692,561 $66,010,273 $67,757,563 $63,478,048 Rate Revenue Increase 4.5% 4.5% 4.5% 4.5% 4.5%
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The following figure visually depicts the cash-flow projections with the proposed rate increases for the next five years. Projected expenses are summarized into key categories. The figure also shows the projected fund reserves at the end of each fiscal year.

Figure 3 – Scenario 2 Projected Cashflow Graph
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
$140.0
FY 22-23 FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28
Rate Funded Capital
Debt Service
O&M
Revenue
Reserves
City of Modesto
Projected Water Revenues & Expenses ($ Millions)
Scenario 2 - Full Capital with New Debt
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Detailed, long-term, cash-flow projections for this scenario are shown in the following table.

Table 9 – Scenario 2 Detailed Cash Flow Projections
Projected Cashflow FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Rate Revenue Increase 4.5% 4.5% 4.5% 4.5% 4.5%
Beginning Reserves $110,862,007 $102,018,732 $83,692,561 $66,010,273 $67,757,563 Revenues n/a n/a n/a n/a n/a
Rate Revenue $79,021,999 $82,743,145 $86,639,520 $90,719,375 $94,991,350 Rate Increase Revenue 3,555,990 3,723,442 3,898,778 4,082,372 4,274,611 Timing Adjustment* -592,665 0 0 0 0
Other Revenue 4,650,665 4,559,418 4,486,792 4,416,744 4,424,415 Interest on Reserves $443,448 $408,075 $334,770 $264,041 $271,030 ________ ________ ________ ________ ________ ________
Total Revenue $87,079,437 $91,434,079 $95,359,861 $99,482,532 $103,961,406 Expenses n/a n/a n/a n/a n/a
Operating Expenses $58,312,292 $59,483,407 $62,419,327 $65,502,043 $68,738,895 Existing Debt Service 11,985,419 12,685,819 12,685,819 12,685,820 12,685,821 New Debt Service 0 0 0 0 2,622,000
Rate Funded Capital $25,625,000 $37,591,025 $37,937,002 $19,547,379 $24,194,205 ________ ________ ________ ________ ________ ________
Total Expenses $95,922,711 $109,760,251 $113,042,148 $97,735,242 $108,240,921 Net Revenues -$8,843,274 -$18,326,172 -$17,682,287 $1,747,289 -$4,279,515 Ending Reserves $102,018,732 $83,692,561 $66,010,273 $67,757,563 $63,478,048 Debt Coverage (Target 2.0) 2.40 2.52 2.60 2.68 2.30
*Reflects October rate implementation
Capital Funding FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Capital Revenues n/a n/a n/a n/a n/a
Use of Debt Proceeds $0 $0 $0 $20,000,000 $20,000,000
Rate Funded Capital $25,625,000 $37,591,025 $37,937,002 $19,547,379 $24,194,205 ________ ________ ________ ________ ________ ________
Total Capital Revenue $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Total Capital Expenditures $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 #16..
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4.8 Cash Flow Projection for Scenario 3 - Full Capital, No Debt In future years, the City can re-evaluate its finances and revenue requirements and adjust rates as needed based on updated projections. However, while the City always has the flexibility to implement rate adjustments that are lower than adopted pursuant to Proposition 218, future rates cannot exceed adopted increases without going through the Proposition 218 process again. Rates adopted pursuant to Proposition 218 are essentially future rate caps.

A summary of the key elements of the long-term cash-flow projections for this scenario is displayed in the following table.

Table 10 – Scenario 3 Cash Flow Projection Summary
Scenario 3 - Full
Capital, No Debt FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Debt Funded Capital $0 $0 $0 $0 $0
Cash Funded Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Total Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Ending Reserves $103,335,766 $88,361,528 $76,015,089 $65,310,989 $53,503,665 Rate Revenue
Increase 6.5% 6.5% 6.5% 6.5% 6.5%
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The following figure visually depicts the cash-flow projections with the proposed rate increases for the next five years. Projected expenses are summarized into key categories. The figure also shows the projected fund reserves at the end of each fiscal year.

Figure 4 – Scenario 3 Projected Cashflow Graph
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
$140.0
FY 22-23 FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28
Rate Funded
Capital
Debt Service
City of Modesto
Projected Water Revenues & Expenses ($ Millions)
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Detailed, long-term, cash-flow projections for this scenario are shown in the following table.

Table 11 – Scenario 3 Detailed Cash Flow Projections
Projected Cashflow FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Rate Revenue Increase 6.5% 6.5% 6.5% 6.5% 6.5%
Beginning Reserves $110,862,007 $103,335,766 $88,361,528 $76,015,089 $65,310,989 Revenues n/a n/a n/a n/a n/a
Rate Revenue $79,021,999 $84,326,746 $89,987,600 $96,028,468 $102,474,859 Rate Increase Revenue 5,136,430 5,481,238 5,849,194 6,241,850 6,660,866 Timing Adjustment* -856,072 0 0 0 0
Other Revenue 4,650,665 4,564,686 4,505,468 4,456,763 4,414,629 Interest on Reserves $443,448 $413,343 $353,446 $304,060 $261,244 ________ ________ ________ ________ ________ ________
Total Revenue $88,396,470 $94,786,013 $100,695,709 $107,031,142 $113,811,598 Expenses n/a n/a n/a n/a n/a
Operating Expenses $58,312,292 $59,483,407 $62,419,327 $65,502,043 $68,738,895 Existing Debt Service 11,985,419 12,685,819 12,685,819 12,685,820 12,685,821 New Debt Service 0 0 0 0 0
Rate Funded Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 ________ ________ ________ ________ ________ ________
Total Expenses $95,922,711 $109,760,251 $113,042,148 $117,735,242 $125,618,921 Net Revenues -$7,526,241 -$14,974,238 -$12,346,439 -$10,704,100 -$11,807,324 Ending Reserves $103,335,766 $88,361,528 $76,015,089 $65,310,989 $53,503,665 Debt Coverage (Target 2.0) 2.51 2.78 3.02 3.27 3.55
*Reflects October rate implementation
Capital Funding FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Capital Revenues n/a n/a n/a n/a n/a
Use of Debt Proceeds $0 $0 $0 $0 $0
Rate Funded Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 ________ ________ ________ ________ ________ ________
Total Capital Revenue $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Total Capital
Expenditures $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 #16..
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4.9 Scenario Projected Cashflow Comparison
With lower capital spending, Scenario 1 preserves $73 million of reserves while cash funding all expenses with

4.5% annual rate revenue increases. Scenario 1 leaves the City in a position where average annual rate revenue increases of 5.5% are conservatively projected for the following rate study (FY 28-29 through FY 32-33).

In Scenario 2, the full capital spending is augmented with a debt issuance of $40 million. This allows the City to preserve $63 million of reserves with 4.5% annual rate revenue increases. Scenario 2 leaves the City in a position where average annual rate revenue increases of 6.4% are conservatively projected for the following rate study (FY 28-29 through FY 32-33).

In Scenario 3, the full capital spending is cash funded. This allows the City to preserve $54 million of reserves with

6.5% annual rate revenue increases. Scenario 3 leaves the City in a position where average annual rate revenue increases of 4.1% are conservatively projected for the following rate study (FY 28-29 through FY 32-33).

It is important to keep in mind projections more than five years out are conservative and do not include grants and capital construction slowdowns. The following table shows key financial information for all scenarios.

Table 12 – Scenario Projected Cashflow Comparison
Scenario 1 - Low Capital,
No Debt FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28
Debt Funded Capital $0 $0 $0 $0 $0
Cash Funded Capital $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 Total Capital $25,625,000 $23,489,550 $26,719,088 $29,617,836 $32,593,800 Ending Reserves $102,018,732 $97,794,035 $91,442,474 $83,322,765 $73,390,177 Rate Revenue Increase 4.5% 4.5% 4.5% 4.5% 4.5%
Scenario 2 – Full Capital
with New Debt FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28 Debt Funded Capital $0 $0 $0 $20,000,000 $20,000,000
Cash Funded Capital $25,625,000 $37,591,025 $37,937,002 $19,547,379 $24,194,205 Total Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Ending Reserves $102,018,732 $83,692,561 $66,010,273 $67,757,563 $63,478,048 Rate Revenue Increase 4.5% 4.5% 4.5% 4.5% 4.5%
Scenario 3 - Full Capital,
No Debt FY 23-24 FY 24-25 FY 25-26 FY 26-27 FY 27-28
Debt Funded Capital $0 $0 $0 $0 $0
Cash Funded Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Total Capital $25,625,000 $37,591,025 $37,937,002 $39,547,379 $44,194,205 Ending Reserves $103,335,766 $88,361,528 $76,015,089 $65,310,989 $53,503,665 Rate Revenue Increase 6.5% 6.5% 6.5% 6.5% 6.5%
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5 COST-OF-SERVICE RATE DERIVATION
Article XIII D, Section 6 of the California Constitution (which was adopted by the voters in 1996 as a part of Proposition 218) requires that the City adopt only rates that meet a number of substantive requirements.

Specifically:
(1) Revenues derived from the water rates cannot exceed the funds required to provide water service. (2) Revenues derived from the water rates cannot be used for any purpose other than providing water service.
(3) The amount of the water rates imposed upon any parcel or person as an incident of property ownership cannot exceed the proportional cost of the service attributable to the parcel. (4) Water rates may not be imposed unless the water service is used by, or immediately available to, the owner of the property in question.

In Modesto, each water customer is charged both a monthly fixed rate and a volumetric rate based on the quantity of water delivered by the City to the customer. This reflects that (i) some system costs are based entirely on the actual quantity of water consumed, (ii) other system costs are fixed from the point of view of the City, but are a result of design decisions that were made to accommodate all users, including high-demand users, and (iii) some costs, particularly the cost of administering the water system, would be largely the same regardless of the volume of water use.

Water utilities have employed a wide range of approaches or perspectives for allocating and recovering their costs for providing service, often through a combination of fixed and variable charges. The percentage of revenues derived from the fixed and variable charges should be proportional to each system’s expenditures and must not exceed the cost of providing service.

Many of the City’s costs are fixed costs that do not vary by the level of service provided, such as operational and staff costs, as well as costs for building and maintaining infrastructure. Some of these costs are related to the number of customers, but most of the fixed costs are related to the total capacity of the water system. Fixed costs related to system capacity can reasonably be apportioned by meter size or variable, usage-based rate recovery in recognition that both units of measure reasonably reflect customer usage driving the City to incur capacity-related costs. For example, a share of the fixed cost of salaries related to water production can reasonably be recovered from usage-based charges as these costs are incurred to provide water supply to meet customer demand or from a fixed charge based on a customer’s meter size which reflects the magnitude of water a customer can pull from the water system. Likewise, debt service payments may be fixed annual costs, but it is reasonable to recover some of these costs from usage-based rates as the costs are incurred to fund infrastructure that will improve the water delivery system.

While there is no single correct approach, BWA believes that costs should be allocated within a reasonable range that reflects both a) underlying cost causation, to the extent such causation can reasonably be determined or estimated, and b) the policy preferences of the agency in cases where a range of reasonable approaches can be justified.
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5.1 Functional Allocation
There must be a cost-based nexus between the revenue requirement from the cash flow and the proposed rates.

The nexus is created by allocating the expenses and offsetting non-rate revenues to functional components and then dividing each functional component’srevenue requirements by the allocations units most reasonably related to each function. A functional component reflects a grouping of the utility’s expenses whose magnitude is driven by the quantity of a specific unit-of-measure. For example, costs allocated to the customer functional component are driven by the number of customers served by the water enterprise.

The functional components used in this study are as follows:
• Customer- Fixed costs are recovered per customer. Fixed costs or costs related to system capacity were allocated to this category.
• Capacity- Fixed costs are recovered per customer. Fixed costs or costs related to system capacity were allocated to this category.
• All Volume- Costs reasonably recovered volumetrically were allocated to this category. Volumetric costs are recovered per unit of volume (100 cubic feet (CCF)) based on all projected demand.

Related expenses and non-rate revenues were grouped into the following allocation categories before being allocated to each functional category:
• Administration- Expenses were allocated 30% to the customer and 70% to capacity functional components because some costs are driven by the number of customers, and some are driven by the overall capacity of the system. For example, a smaller system would require less staff, leading to reduced office supply costs. • Source of Supply- expenses were allocated 10% to Capacity and 90% to All Volume to reflect that these costs are incurred to meet the volumetric needs of the City. These costs include the costs associated with wells and groundwater supply.
• Water Demand expenses consist of conservation, water quality and surface water costs. They are allocated 100% to All Volume to reflect that these costs are incurred to meet the volumetric needs of the City. • Customer Accounts costs are allocated 100% to the Customer functional component because they are fixed expenditures that relate to operational support activities, including billing, customer service, and meter reading support. These expenditures are common to all customers, regardless of the meter size serving a property or actual water use.
• Water System expenses are related to maintaining and operating the water system. These costs are allocated 50% to Capacity and 50% to All Volume because these costs are related to the overall capacity of the system which is driven by the projected volume of water sold.
• Debt Service is allocated 100% to Capacity because they are related to system capacity and are fixed annual expenses.
• Capital expenses and non-rate revenues are allocated 50% to Capacity and 50% to All Volume because these costs are related to the overall capacity of the system which is driven by the projected volume of water sold.

The following tables show a breakdown of the water utility’s expenses and offsetting revenues and how they are allocated by function. The proportional allocation is then applied to the rate revenue requirement so that the #16..
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rates are proportional to the cost of service provided. To recover the allocated revenue requirements proportionally to the service provided, a unit cost must be derived. Critical to this step is using the unit which relates to the function.

The allocation amounts are based on the last year of the proposed rates, FY 27-28, because it reflects the completed regionalization project in operation. The revenue requirements leading up to that year are increasing to fund the project.

Table 13 – Scenario 1 Functional Allocation
Functional Allocation Amount
Offsetting
Revenue
Allocation
Amount Customer Capacity All Volume Total
Administration $7,550,855 $0 $7,550,855 30% 70% 0% 100% Source of Supply $9,839,635 $0 $9,839,635 0% 10% 90% 100% Water Demand $24,584,204 $0 $24,584,204 0% 0% 100% 100% Customer Accounts $6,831,266 $0 $6,831,266 100% 0% 0% 100% Water System $11,638,388 $0 $11,638,388 0% 50% 50% 100% Debt Service $12,545,740 $0 $12,545,740 0% 100% 0% 100% Capital $27,609,055 $330,328 $27,278,726 0% 50% 50% 100% Functional Allocation $ $100,599,144 $330,328 $100,268,815 $9,096,523 $38,273,859 $52,898,433 $100,268,815 Functional Allocation % n/a n/a n/a 9.07% 38.17% 52.76% 100% Revenue Requirement n/a n/a n/a $7,489,824 $31,520,018 $43,568,147 $82,577,989 Table 14 – Scenario 2 Functional Allocation
Functional Allocation Amount
Offsetting
Revenue
Allocation
Amount Customer Capacity All Volume Total
Administration $7,550,855 $52,060 $7,498,795 30% 70% 0% 100% Source of Supply $9,839,635 $0 $9,839,635 0% 10% 90% 100% Water Demand $24,584,204 $0 $24,584,204 0% 0% 100% 100% Customer Accounts $6,831,266 $0 $6,831,266 100% 0% 0% 100% Water System $11,638,388 $0 $11,638,388 0% 50% 50% 100% Debt Service $12,545,740 $0 $12,545,740 0% 100% 0% 100% Capital $28,978,922 $330,328 $28,648,594 0% 50% 50% 100% Functional Allocation $ $101,969,011 $382,388 $101,586,623 $9,080,905 $38,922,351 $53,583,367 $101,586,623 Functional Allocation % n/a n/a n/a 8.94% 38.31% 52.75% 100% Revenue Requirement n/a n/a n/a $7,382,472 $31,635,628 $43,559,889 $82,577,989 Table 15 – Scenario 3 Functional Allocation
Functional Allocation Amount
Offsetting
Revenue
Allocation
Amount Customer Capacity All Volume Total
Administration $7,550,855 $0 $7,550,855 30% 70% 0% 100% Source of Supply $9,839,635 $0 $9,839,635 0% 10% 90% 100% Water Demand $24,584,204 $0 $24,584,204 0% 0% 100% 100% Customer Accounts $6,831,266 $0 $6,831,266 100% 0% 0% 100% Water System $11,638,388 $0 $11,638,388 0% 50% 50% 100% Debt Service $12,545,740 $0 $12,545,740 0% 100% 0% 100% Capital $36,978,922 $330,328 $36,648,594 0% 50% 50% 100% Functional Allocation $ $109,969,011 $330,328 $109,638,683 $9,096,523 $42,958,793 $57,583,367 $109,638,683 Functional Allocation % n/a n/a n/a 8.30% 39.18% 52.52% 100% Revenue Requirement n/a n/a n/a $6,985,150 $32,973,272 $44,200,007 $84,158,429 #16..
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5.2 Rate Derivation
Monthly Fixed Service Charge
This charge applies to all active services. It recovers the Customer functional component revenue requirement on a per service basis and the Capacity functional component revenue requirement on a per MEU basis. The Customer unit cost is the same for all meter sizes and the unit costs per MEU varies by meter size. MEU ratios are based on the AWWA meter equivalent ratio for each meter size as described in Section 3.2.

Monthly Volumetric Service Charge
This charge applies to every unit of water sold. It recovers the All Volume functional component revenue requirement on a unit (CCF) basis.

The following tables show the rate derivation of the fixed and volumetric charges for each scenario.

Table 16 – Scenario 1 Rate Derivation
Allocation Units n/a Customer Capacity All Volume
Unit of Measure n/a # EDU CCF
Allocation Units n/a 894,714 1,740,024 20,693,839
Revenue
Requirement n/a $7,489,824 $31,520,018 $43,568,147
Unit Cost ($/Unit) n/a $8.37 $18.11 $2.11
Monthly Fixed
Charge Calculation
Capacity
Factor**
Monthly
Customer
Component
Monthly
Capacity
Component
Monthly Fixed
Charge
5/8" 1.00 $8.37 $18.11 $26.48
3/4" 1.00 $8.37 $18.11 $26.48
1" 1.67 $8.37 $30.18 $38.56

1.5" 3.33 $8.37 $60.37 $68.74
2" 5.33 $8.37 $96.59 $104.96
3" 11.67 $8.37 $211.28 $219.66
4" 21.00 $8.37 $380.31 $388.68
6" 43.33 $8.37 $784.77 $793.14
8" 80.00 $8.37 $1,448.80 $1,457.17
10" 126.67 $8.37 $2,293.93 $2,302.31
12" 166.67 $8.37 $3,018.33 $3,026.71
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Table 17 – Scenario 2 Rate Derivation
Allocation Units n/a Customer Capacity All Volume
Unit of Measure n/a # EDU CCF
Allocation Units n/a 894,714 1,740,024 20,693,839
Revenue
Requirement n/a $7,382,472 $31,635,628 $43,559,889
Unit Cost ($/Unit) n/a $8.25 $18.18 $2.11
Monthly Fixed
Charge Calculation
Capacity
Factor**
Monthly
Customer
Component
Monthly
Capacity
Component
Monthly Fixed
Charge
5/8" 1.00 $8.25 $18.18 $26.43
3/4" 1.00 $8.25 $18.18 $26.43
1" 1.67 $8.25 $30.30 $38.55

1.5" 3.33 $8.25 $60.60 $68.85
2" 5.33 $8.25 $96.96 $105.21
3" 11.67 $8.25 $212.10 $220.35
4" 21.00 $8.25 $381.78 $390.03
6" 43.33 $8.25 $787.80 $796.05
8" 80.00 $8.25 $1,454.40 $1,462.65
10" 126.67 $8.25 $2,302.80 $2,311.05
12" 166.67 $8.25 $3,030.00 $3,038.25
Table 18 – Scenario 3 Rate Derivation
Allocation Units n/a Customer Capacity All Volume
Unit of Measure n/a # EDU CCF
Allocation Units n/a 894,714 1,740,024 20,693,839
Revenue
Requirement n/a $6,985,150 $32,973,272 $44,200,007
Unit Cost ($/Unit) n/a $7.81 $18.95 $2.14
Monthly Fixed
Charge Calculation
Capacity
Factor**
Monthly
Customer
Component
Monthly
Capacity
Component
Monthly Fixed
Charge
5/8" 1.00 $7.81 $18.95 $26.76
3/4" 1.00 $7.81 $18.95 $26.76
1" 1.67 $7.81 $31.58 $39.40

1.5" 3.33 $7.81 $63.17 $70.98
2" 5.33 $7.81 $101.07 $108.88
3" 11.67 $7.81 $221.08 $228.90
4" 21.00 $7.81 $397.95 $405.76
6" 43.33 $7.81 $821.17 $828.98
8" 80.00 $7.81 $1,516.00 $1,523.81
10" 126.67 $7.81 $2,400.33 $2,408.15
12" 166.67 $7.81 $3,158.33 $3,166.15
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5.3 Proposed Water Rates
The following tables show a 5-year schedule of proposed water rates for each scenario.

Table 19 – Proposed Scenario 1 Water Rates
Current and Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates n/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF) $2.02 $2.11 $2.20 $2.30 $2.40 $2.51
Drought ($/CCF) n/a $2.45 $2.56 $2.68 $2.80 $2.93
Monthly Fixed Charge n/a n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.48 $27.67 $28.92 $30.22 $31.58
3/4" $25.44 $26.48 $27.67 $28.92 $30.22 $31.58
1" $36.83 $38.56 $40.30 $42.11 $44.00 $45.98

1.5" $65.32 $68.74 $71.83 $75.06 $78.44 $81.97
2" $99.50 $104.96 $109.68 $114.62 $119.78 $125.17
3" $207.73 $219.66 $229.54 $239.87 $250.66 $261.94
4" $367.24 $388.68 $406.17 $424.45 $443.55 $463.51
6" $748.90 $793.14 $828.83 $866.13 $905.11 $945.84
8" $1,375.53 $1,457.17 $1,522.74 $1,591.26 $1,662.87 $1,737.70 10" $2,173.05 $2,302.31 $2,405.91 $2,514.18 $2,627.32 $2,745.55 12" $2,856.63 $3,026.71 $3,162.91 $3,305.24 $3,453.98 $3,609.41 #16..
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Table 20 – Proposed Scenario 2 Water Rates
Current and Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates n/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF) $2.02 $2.11 $2.20 $2.30 $2.40 $2.51
Drought ($/CCF) n/a $2.45 $2.56 $2.68 $2.80 $2.93
Monthly Fixed Charge n/a n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
3/4" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
1" $36.83 $38.55 $40.28 $42.09 $43.98 $45.96

1.5" $65.32 $68.85 $71.95 $75.19 $78.57 $82.11
2" $99.50 $105.21 $109.94 $114.89 $120.06 $125.46
3" $207.73 $220.35 $230.27 $240.63 $251.46 $262.78
4" $367.24 $390.03 $407.58 $425.92 $445.09 $465.12
6" $748.90 $796.05 $831.87 $869.30 $908.42 $949.30
8" $1,375.53 $1,462.65 $1,528.47 $1,597.25 $1,669.13 $1,744.24 10" $2,173.05 $2,311.05 $2,415.05 $2,523.73 $2,637.30 $2,755.98 12" $2,856.63 $3,038.25 $3,174.97 $3,317.84 $3,467.14 $3,623.16 #16..
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City of Modesto – Water Rate Study 2023
Table 21 – Proposed Scenario 3 Water Rates
Current and Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates n/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF) $2.02 $2.14 $2.28 $2.43 $2.59 $2.76
Drought ($/CCF) n/a $2.49 $2.65 $2.82 $3.00 $3.20
Monthly Fixed Charge n/a n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.76 $28.50 $30.35 $32.32 $34.42
3/4" $25.44 $26.76 $28.50 $30.35 $32.32 $34.42
1" $36.83 $39.40 $41.96 $44.69 $47.59 $50.68

1.5" $65.32 $70.98 $75.59 $80.50 $85.73 $91.30
2" $99.50 $108.88 $115.96 $123.50 $131.53 $140.08
3" $207.73 $228.90 $243.78 $259.63 $276.51 $294.48
4" $367.24 $405.76 $432.13 $460.22 $490.13 $521.99
6" $748.90 $828.98 $882.86 $940.25 $1,001.37 $1,066.46
8" $1,375.53 $1,523.81 $1,622.86 $1,728.35 $1,840.69 $1,960.33 10" $2,173.05 $2,408.15 $2,564.68 $2,731.38 $2,908.92 $3,098.00 12" $2,856.63 $3,166.15 $3,371.95 $3,591.13 $3,824.55 $4,073.15 #16..
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BARTLE WELLS ASSOCIATES 30
City of Modesto – Water Rate Study 2023
6 REGIONAL RESIDENTIAL BILL COMPARISON
Figure 5 provides a residential bill survey comparing the City of Modesto’s current and proposed water bills with the bills of other local agencies. The City of Modesto bills shown in Figure 5 are the non-drought water bills. Since each agency has an individualized conservation target, it is unknown how the City of Modesto typical water use would compare. Even with the proposed rate increases under each scenario, the City of Modesto’s typical bill would remain competitive.

Figure 5 – Residential Bill Comparison
$0
$20
$40
$60
$80
$100
$120
$140
City of Modesto Single Family Residential Water Bill Comparison Monthly Service - 1" meter, 10,900 gallons (14.6 ccf) consumption April 2023
Fixed Charge Variable Charge
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BARTLE WELLS ASSOCIATES 31
City of Modesto – Water Rate Study 2023
7 DROUGHT RATES
The City is proposing to authorize a drought rate that could be implemented to support financial stability and help ensure adequate funding for water utility operations during periods of water shortages and reduced water sales.

As proposed, these rates would be temporary, billed based on metered water use, that would replace the City’s regular water rates during water shortage emergencies.

The drought rates are designed to enable the City to recover its costs of service and remain financially stable during periods of water shortages and reduced water sales.

Financial impacts during water shortages and periods of reduced water sales can include:
• A loss of volumetric water rate revenues due to a reduction in the volume of water sales. • Reduced variable expenses due to reduced volumes of water production and supply, such as reduced costs for water treatment and pumping.
• Additional costs for achieving water demand cutback targets, such as costs for an enhanced conservation program and water demand mitigation efforts.
• Additional costs for supplemental sources of water supply when normal-year supply is curtailed during a drought.
• Potential costs of compliance for drought-related regulations and potential cost of fines or penalties for non-compliance with State water reduction mandates during periods of severe drought.

The surcharges account for a) lost revenues due to reduced water sales, less b) estimated reduced variable expenses due to reduced water supply, divided by c) the volume of projected water sales with reduced demand.

Table 22 – Proposed Scenario 1 Drought Rates
Row Drought Rate Calculation Units Amount
A Projected volume CCF 20,693,839
B Drought reduction % 15%
C Drought volume (A x (1-B)) CCF 17,589,763
D Volume reduction (A x B) CCF 3,104,076
E Variable Cost $/CCF $0.14
F Variable cost reduction (D x E) $ $434,571
G Projected revenue requirement $ $43,568,147
H Drought revenue requirement (G - F) $ $43,133,576
I Drought rate (H / C) $/CCF $2.45
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BARTLE WELLS ASSOCIATES 32
City of Modesto – Water Rate Study 2023
Table 23 – Proposed Scenario 2 Drought Rates
Row Drought Rate Calculation Units Amount
A Projected volume CCF 20,693,839
B Drought reduction % 15%
C Drought volume (A x (1-B)) CCF 17,589,763
D Volume reduction (A x B) CCF 3,104,076
E Variable Cost $/CCF $0.13
F Variable cost reduction (D x E) $ $403,530
G Projected revenue requirement $ $43,559,889
H Drought revenue requirement (G - F) $ $43,156,359
I Drought rate (H / C) $/CCF $2.45
Table 24 – Proposed Scenario 3 Drought Rates
Row Drought Rate Calculation Units Amount
A Projected volume CCF 20,693,839
B Drought reduction % 15%
C Drought volume (A x (1-B)) CCF 17,589,763
D Volume reduction (A x B) CCF 3,104,076
E Variable Cost $/CCF $0.14
F Variable cost reduction (D x E) $ $434,571
G Projected revenue requirement $ $44,200,007
H Drought revenue requirement (G - F) $ $43,765,436
I Drought rate (H / C) $/CCF $2.49
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BARTLE WELLS ASSOCIATES 33
City of Modesto – Water Rate Study 2023
8 CONCLUSION AND RECOMMENDATIONS
This water rate study report presents a comprehensive review of the City of Modesto’s water revenue requirements and rate structures. The City will need regular annual rate increases to keep up with cost inflation and be able to complete necessary capital projects while maintaining prudent reserves.

8.1 Conclusion
The City practices sound financial planning which has provided for the financial health of the water enterprise.

Historically, the City has increased rate revenue to keep up with inflationary cost increases and fund system upgrades and maintenance. The adoption of these rates reflect the City’s commitment to stewarding financially sound utilities and providing reliable, high quality water service that will benefit the community many years into the future.

8.2 Recommendations
BWA recommends that the City adopt the rates shown in this report. Rates were developed as part of a collaborative process. At minimum, BWA recommends that the City review and update its water rate study every five years and/or concurrent with Master Plan Updates. Proposition 218 allows public agencies to adopt rates over a five-year planning period. Any further rate increases must be proposed as part of a new Proposition 218 process #16..
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PRESORTED

FIRST CLASS MAIL
U.S. POSTAGE
PAID

CONCORD, CA
PERMIT NO. 530
City of ModestoCity ClerkP.O. Box 6421010 Tenth Street, Suite 6600Modesto, CA 95353 Utility Billing Assistance Program:

Programa de Asistencia de Facturación de Servicios Públicos:
https://www.modestogov.com/2207/Assistance-Programs-for-Utilities-Custom Water Rate Increase FAQ:

Preguntas frecuentes sobre el aumento de las tarifas del servicio de agua:
https://www.modestogov.com/prop218

NOTICE OF PUBLIC HEARING ON

PROPOSED WATER RATE INCREASE
AVISO DE AUDIENCIA PÚBLICA SOBRE EL AUMENTO DE TARIFAS

PROPUESTO PARA EL SERVICIO DE ALCANTARILLADO SANITARIO
August 22, 2023, at 5:30 pm
City Of Modesto-City Hall
1010 Tenth Street, Basement Level, Modesto
22 de agosto de 2023 a las 5:30 pm
Ciudad de Modesto - Ayuntamiento
1010 Tenth Street, Nivel Sótano, Modesto
For additional information regarding proposed water rate increases, contact Customer Service at (209) 577-5395 or e-mail [email protected] Para obtener información adicional con respecto a los aumentos propuestos a las tarifas de alcantarillado sanitario, contacte a Servicio al Cliente al (209) 577-5395 o envíe un correo electrónico a [email protected] #16..
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Proposed Water Rate Increases
The City of Modesto is proposing to gradually phase in water rate increases over the next five years to support the City’s Water system’s operating and maintenance needs and provide adequate funding for capital improvements that will support safe and reliable drinking water service. The rates shown in this notice are the proposed maximum rates to be authorized. Each year, as it has in the past, the City will review its current financial position to determine the necessary rate increase.

The City’s water utility is self-supporting and relies on rates paid by customers to fund the costs of operations and maintenance and capital improvement projects. Water rate increases are needed to support the water system’s increasing operating expenses, pay for increasing costs of surface water supply, provide adequate funding for maintenance of facilities and equipment, meet annual debt service funding requirements, keep up with cost inflation, and help ensure continued compliance with regulatory requirements. Although rate increases are currently needed, the City actively pursues cost saving measures for the benefit of the customers and only raises rates when necessary. Various state and federal grants resulted in the City not raising water rates in 2022 and we are committed to continuously seeking out these funding opportunities. The City has a history of success in winning grants and securing low-cost loans to improve the water system.

City of Modesto offers a Utility Billing Assistance program for eligible applicants. Enrolled customers receive $45.00 off of their monthly charges. For program eligibility and information please visit https://www.modestogov.com/2207/Assistance-Programs-for-Utilities-Custom.

The proposed water rate increases for all customers are shown in the following table. Sample residential bills are provided in the box on the next page. If approved, the first rate adjustments for all customers will take effect October 1, 2023. The subsequent rate increases will take place on October 1 in the following four years. The water rates consist of monthly fixed charge levied independently of water use which is based on the size of each customer’s water meter, and a volumetric rate charged per hundred cubic feet of metered water use.

Current and
Proposed
Water Rates Current
Proposed
Oct 1, 2023
Proposed
Oct 1, 2024
Proposed
Oct 1, 2025
Proposed
Oct 1, 2026
Proposed
Oct 1, 2027
Volumetric Rates/a n/a n/a n/a n/a n/a
Non-Drought
($/CCF*) $2.02 $2.11 $2.20 $2.30 $2.40 $2.51
Drought
($/CCF*) n/a $2.45 $2.56 $2.68 $2.80 $2.93
Monthly Fixed Charge n/a n/a n/a n/a n/a
Meter Size n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
3/4" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
1" $36.83 $38.55 $40.28 $42.09 $43.98 $45.96

1.5" $65.32 $68.85 $71.95 $75.19 $78.57 $82.11
2" $99.50 $105.21 $109.94 $114.89 $120.06 $125.46
3" $207.73 $220.35 $230.27 $240.63 $251.46 $262.78
4" $367.24 $390.03 $407.58 $425.92 $445.09 $465.12
6" $748.90 $796.05 $831.87 $869.30 $908.42 $949.30
8" $1,375.53 $1,462.65 $1,528.47 $1,597.25 $1,669.13 $1,744.24 10" $2,173.05 $2,311.05 $2,415.05 $2,523.73 $2,637.30 $2,755.98 12" $2,856.63 $3,038.25 $3,174.97 $3,317.84 $3,467.14 $3,623.16 *CCF, one-hundred cubic feet = 748.05 gallons

Aumentos de tarifas propuestos para el servicio de agua La Ciudad de Modesto propone aumentar gradualmente las tarifas del agua durante los próximos cinco años a fin de cubrir las necesidades de funcionamiento y mantenimiento del sistema de agua de la ciudad y proporcionar una financiación adecuada para las mejoras de capital que permitan un servicio de agua potable seguro y confiable. Las tarifas que se muestran en este aviso son las tarifas máximas propuestas para ser autorizadas. Cada año, como ha hecho en el pasado, la Ciudad evaluará su situación financiera actual con el fin de determinar el aumento de tarifas necesario.

El servicio público de agua de la Ciudad es autosuficiente y depende de las tarifas pagadas por los clientes para financiar los costos de sus operaciones y de mantenimiento, y de los proyectos de mejora de capital.

Los aumentos de las tarifas del agua son necesarios para cubrir los crecientes gastos de funcionamiento del sistema de abastecimiento de agua, pagar los costos cada vez mayores del suministro de agua de superficie, proporcionar una financiación adecuada para el mantenimiento de las instalaciones y los equipos, cumplir los requisitos anuales de financiación del servicio de la deuda, mantenerse al día con la inflación de los costos y ayudar a garantizar el cumplimiento continuado de los requisitos reglamentarios. Si bien actualmente es necesario aumentar las tarifas, la Ciudad implementa activamente medidas de ahorro de costos en beneficio de sus clientes y sólo aumenta las tarifas cuando es necesario. Varias subvenciones estatales y federales dieron como resultado que la Ciudad no aumentara las tarifas de agua en 2022 y nos comprometemos a buscar continuamente estas oportunidades de financiación. La Ciudad tiene un historial de éxitos en adquirir subvenciones y obtener préstamos de bajo costo para mejorar el sistema de agua.

La Ciudad de Modesto ofrece un Programa de Asistencia de Facturación de Servicios Públicos a los solicitantes que cumplan los requisitos. Los clientes inscritos recibirán $45.00 de descuento en sus cargos mensuales. Para conocer los requisitos de participación y obtener información sobre el programa, por favor visite https://www.modestogov.com/2207/Assistance-Programs-for-Utilities-Custom.

Los aumentos propuestos en las tarifas de agua de todos los clientes se muestran en la siguiente tabla. En el recuadro incluido en la siguiente página se muestran ejemplos de facturas residenciales. Si se aprueban, los primeros ajustes a las tarifas para todos los clientes entrarán en vigor el 1 de octubre de 2023. Los aumentos posteriores tendrán lugar el 1 de octubre de los cuatro años siguientes. Las tarifas del agua consisten en un cargo fijo mensual que se recauda independientemente del consumo de agua y que se basa en el tamaño del medidor de agua de cada cliente, y una tarifa volumétrica que se cobra por cada cien pies cúbicos de consumo de agua medido.

Tarifas de agua
actuales y propuestas Actual
Propuestas
1 oct. 2023
Propuestas
1 oct. 2024
Propuestas
1 oct. 2025
Propuestas
1 oct. 2026
Propuestas
1 oct 2027
Tarifas volumétricas/a n/a n/a n/a n/a n/a
Períodos sin sequía
($/CCF*) $2.02 $2.11 $2.20 $2.30 $2.40 $2.51
Períodos de sequía
($/CCF*) n/a $2.45 $2.56 $2.68 $2.80 $2.93
Cargo fijo mensual n/a n/a n/a n/a n/a
Tamaño del medidor n/a n/a n/a n/a n/a n/a
5/8" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
3/4" $25.44 $26.43 $27.62 $28.86 $30.16 $31.52
1" $36.83 $38.55 $40.28 $42.09 $43.98 $45.96

1.5" $65.32 $68.85 $71.95 $75.19 $78.57 $82.11
2" $99.50 $105.21 $109.94 $114.89 $120.06 $125.46
3" $207.73 $220.35 $230.27 $240.63 $251.46 $262.78
4" $367.24 $390.03 $407.58 $425.92 $445.09 $465.12
6" $748.90 $796.05 $831.87 $869.30 $908.42 $949.30
8" $1,375.53 $1,462.65 $1,528.47 $1,597.25 $1,669.13 $1,744.24 10" $2,173.05 $2,311.05 $2,415.05 $2,523.73 $2,637.30 $2,755.98 12" $2,856.63 $3,038.25 $3,174.97 $3,317.84 $3,467.14 $3,623.16 *CCF, cien pies cúbicos = 748.05 galones
The City retained an independent consultant to perform a study that calculated the proportional cost of providing water services to each property owner and customer. The study explains how the proposed rates and charges were developed, in compliance with applicable California law, including Article XIIID of the California Constitution. The study may be viewed at 1010 Tenth Street, Suite 4600, Modesto, CA 95354, Utilities Department or online at the following web address:
https://www.modestogov.com/prop218.

Public Notice and Majority Protest Process
The City Council will conduct a public hearing on August 22, 2023, to consider approving the proposed rates and charges. Any property owner or customer of record subject to the proposed rates and charges may submit a written protest for the proposed increases. However, only one protest per parcel may be submitted. The proposed rates cannot be adopted if written protests are received from a majority of affected parcels. Written protests must be submitted prior to the close of the Public Hearing.

If you desire to submit a written protest, it must: 1) identify whether you are the property owner or customer and state that the property owner or customer opposes the proposed water rate increases and/or charges; 2) provide the location of the identified parcel (by assessor’s parcel number or street address); and 3) include the name and signature of the property owner or customer submitting the protest. Written protests may be submitted by mail to the City Clerk, P.O. Box 642, Modesto, CA 95353; or in person at 1010 Tenth Street, Suite 6600, Modesto, CA 95354; or at the public hearing. Any protest submitted via e-mail, fax, or other electronic means will not be accepted. Please identify on the front of the envelope for any protest, whether mailed or submitted in person to the City Clerk, that the enclosed letter is for the Public Hearing on the Proposed Increases to Water Rates and Charges.

City Council will receive and consider all written and oral protests to the proposed rates and charges at the Public Hearing. Upon conclusion of the Public Hearing, the City Council will consider adoption of the proposed rates and charges. Oral comments at the public hearing will not qualify as formal protests unless accompanied by a written protest. If written protests against the proposed rates and charges as outlined above are not presented by property owners or customers representing a majority of the identified parcels upon which the rates and charges are proposed to be imposed, the City Council will be authorized to impose the rates and charges.

Pursuant to California Government Code section 53759, there will be a 120 day statute of limitations for challenging any new, increased, or extended fee including water or sewer service charges adopted, modified, or amended after January 1, 2022.

A sample monthly bill calculation for a single family residential customer under the October 1, 2023 proposed non-drought rates is provided below. Typical residential water use in non-drought conditions is 15 ccf per month (about 11,200 gallons).
1 inch meter charge: $38.55
15 ccf water use: $2.11 x 15 ccf = $31.65
Total monthly bill: $38.55 + $31.65 = $70.20 which is a $3.07 increase from the current rates A modo de ejemplo, a continuación se muestra el cálculo de una cuenta mensual para un cliente residencial con vivienda unifamiliar según las tarifas propuestas para el día 1 de octubre de 2023, considerando un período sin sequía. El típico consumo de agua residencial en condiciones sin sequía es de 15 ccf por mes (alrededor de 11,200 galones).

Cargo por medidor de 1 pulg.: $38.55
Consumo de 15 ccf de agua: $2.11 x 15 ccf = $31.65
Cuenta mensual total: $38.55 + $31.65 = $70.20 lo que supone un aumento de $3.07 en relación con las tarifas actuales
La Ciudad contrató a un consultor independiente para llevar a cabo un estudio que calculó el costo proporcional de prestar servicios de agua a cada tipo de propietario y cliente. El estudio explica cómo se desarrollaron las tarifas y cargos propuestos, de conformidad con las leyes aplicables de California, tal como el Artículo XIIID de la Constitución de California. El estudio puede consultarse en 1010 Tenth Street, Suite 4600, Modesto, CA 95354, Utilities Department o por Internet en la siguiente dirección web:
https://www.modestogov.com/prop218.

Aviso público y proceso de protestas mayoritarias
El Concejo Municipal realizará una audiencia pública el 22 de agosto de 2023 para considerar la aprobación de las tarifas y los cargos propuestos. Cualquier dueño de propiedad o cliente registrado que esté sujeto a estas tarifas y cargos puede presentar por escrito una protesta a los aumentos propuestos. Sin embargo, sólo podrá presentarse una protesta por parcela. Las tarifas propuestas no pueden adoptarse si se reciben protestas por escrito de la mayoría de las parcelas afectadas. Las protestas por escrito deben presentarse antes del cierre de la Audiencia pública.

Si desea presentar una protesta por escrito, usted deberá: 1) indicar si usted es el dueño de la propiedad o un cliente y declarar que como dueño o cliente usted se opone a los aumentos y/o cargos propuestos para las tarifas de agua; 2) proporcionar la ubicación de la parcela identificada (número de parcela del tasador o dirección postal); y 3) incluir el nombre y la firma del dueño de la propiedad o cliente que presenta la protesta. Las protestas por escrito pueden ser enviadas por correo postal al Secretario Municipal a la siguiente dirección: City Clerk, P.O. Box 642, Modesto, CA 95353; o entregarse personalmente en 1010 Tenth Street, Suite 6600, Modesto, CA 95354; o presentarlas en la audiencia pública. No se aceptarán protestas enviadas por correo electrónico, fax u otro medio electrónico. Por favor indique en el frente del sobre, ya sea que lo envíe por correo o lo entregue personalmente al Secretario de la Ciudad, que la carta con su protesta es para la audiencia pública sobre los aumentos propuestos a las tarifas y cargos del servicio de agua (Public Hearing on the Proposed Increases to Water Rates and Charges).

El Concejo Municipal recibirá y considerará todas las protestas escritas y orales a las tarifas y cargos propuestos recibidas en la audiencia pública. Tras la conclusión de la audiencia pública, el Concejo Municipal considerará la adopción de las tarifas y cargos propuestos. Los comentarios orales en la audiencia pública no se considerarán protestas formales, a menos que vayan acompañados de una protesta por escrito. Si las protestas presentadas por escrito en contra de las tarifas y cargos propuestos, tal como se describen más arriba, no son presentadas por dueños de propiedades o clientes que representen una mayoría de las parcelas identificadas a las que se aplicarían tales tarifas y cargos, el Concejo Municipal quedará autorizado a imponer tales tarifas y cargos.

De conformidad con el artículo 53759 del Código de Gobierno de California, habrá un plazo de prescripción de 120 días para impugnar cualquier cargo nuevo, aumentado o ampliado, incluidos los cargos por servicio de agua o alcantarillado adoptados, modificados o enmendados después del 1 de enero de 2022.
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8/22/2023 4:45:00 PM

OFFICE OF THE CITY CLERK

NOTICE OF SPECIAL MEETING
Please take notice that a special Closed Session meeting of the Council of the City of Modesto has been called pursuant to Section 2-1.02 of the Modesto Municipal Code to be convened on
TUESDAY, AUGUST 22, 2023 AT 4:45 PM
and after the regularly scheduled meeting in the Tenth Street Place, Chambers Conference Room, Basement Level, 1010 Tenth Street, Modesto, California.

Any and all of the following agenda items are subject to action being taken by the Modesto City Council.

The business to be considered at said City Council meeting shall consist of a Closed Session concerning the following:

CLOSED SESSION
CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION
One Case (Pursuant to Section 54956.9(d)(1) of the Government Code) Name of Case: Chipponeri v. City of Modesto
Case No. 2028661

BY ORDER OF THE CHAIR
/S
Diane Nayares-Perez, City Clerk
Posted pursuant to Government Code Section 54956 on the bulletin board at Tenth Street Place on at by
date time signature
#.
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