ITEM:		ACTION ITEMS
14.	CONSIDER EXPENDITURE OF BUDGETED CONTINGENCY FUNDS TO PREPARE REVISED VERSION OF JUNE 26, 2006 REPORT BY BOOKMAN-EDMONSTON/GEI CONSULTANTS, “SEAWATER DESALINATION PROJECTS EVALUATION”
Meeting Date:			October 16, 2006	Budgeted:	Yes
From:			David A. Berger,	Program/	Contingency/Acct. 8900
			General Manager	Line Item No.:
Prepared By:			Henrietta Stern,	Cost Estimate:	$15,000
			Andrew Bell
General Counsel Approval: N/A
Committee Recommendation: The Administrative Committee reviewed this item on October 4, 2006 and recommended that it be submitted to the full Board for consideration.
CEQA Compliance: N/A

SUMMARY: The Board will consider amending an existing contract with Bookman-Edmonston/GEI Consultants (B-E/GEI) for additional services to revise their final report evaluating three seawater desalination project alternatives. The current not-to-exceed cost in the contract with B-E/GEI would be amended from $55,000 to $70,000. The report revisions would be in response to questions and comments on the report by the Board and public at the June 29, 2006 Workshop and subsequent comments submitted by project sponsors California American Water (Cal-Am) and Pajaro/Sunny Mesa Community Services District. The scope and costs for the additional work are presented in Exhibit 14-A. A summary of comments by the Board, the public, and project proponents, including copies of written comments received after the workshop, was provided to the Board in a memorandum from the District Engineer dated September 12, 2006 (Exhibit 14-B).

RECOMMENDATION: Staff recommends that the Board authorize the General Manager to amend the existing contract with B-E/GEI to revise the June 26, 2006 report titled “Seawater Desalination Projects Evaluation” at a cost not to exceed $15,000.

BACKGROUND AND DISCUSSION: In 2004 and 2005, all information for the MPWMD comparative matrix of water supply alternatives was submitted by the project sponsors with no independent analysis by MPWMD to assess the completeness or accuracy of the information. At its February 23, 2006 meeting, the District Board authorized a contract with B-E/GEI to perform an independent review of the three desalination projects then included in the matrix. The projects are as follows:

1. Coastal Water Project, sponsored by Cal-Am.

2. North Monterey County Desalination Project, sponsored by the Pajaro/Sunny Mesa Community Services District.

3. 7.5 million-gallon-per-day project in Sand City, most recently evaluated by MPWMD in 2004.

At the June 29, 2006 Board Special Workshop, B-E/GEI presented their June 26, 2006 report titled “Seawater Desalination Projects Evaluation.” Copies of the full report are available at the District office, and presentation materials are provided at the following website location:

http://www.mpwmd.dst.ca.us/asd/board/boardpacket/2006/20060629/0629agenda.htm.

At the June 2006 workshop, B-E/GEI representatives responded to a number of questions and comments by the Board and public. At the end of the workshop, the Board asked for the cost for additional work by B-E/GEI to revise the final report by including responses to comments and questions during the workshop.

At its July 17, 2006 meeting, the Board was advised that $15,000 is needed to respond to comments and revise the report. At that meeting, the Board determined that additional funds should not be expended to revise the report at that time, and to defer action on amending the B-E/GEI contract until after the September 25, 2006 Board Strategic Planning Workshop. District staff was directed to solicit written comments from Cal-Am and Pajaro/Sunny Mesa Community Services representatives and to prepare a summary of oral and written comments. A summary of comments by the Board, the public, and project proponents, including copies of written comments received was provided to the Board under separate cover in a memorandum from the District Engineer dated September 12, 2006. These materials have been provided to B-E/GEI.

Staff believes it is important to revise and update the report so that it provides as complete an evaluation as possible of information currently available for the District and the public. Comments and questions regarding the report, particularly by Cal-Am and Pajaro/Sunny Mesa representatives, have resulted in the report being viewed as inaccurate and incomplete. By spending an additional $15,000, the District will protect the $53,700 investment already made in reviewing and evaluating the three projects. An updated report will also be useful to members of the public and the proposed Citizens Advisory Committee in being able to better understand these major water supply project proposals.

IMPACT TO STAFF/RESOURCES: On February 23, 2006 the Board authorized an expenditure of up to $60,000, including a contingency of $5,000, to contract with B-E/GEI to prepare a comparison of desalination costs and timelines. A contract for an amount not-to-exceed $55,000 was executed with B-E/GEI and approximately $53,700 was expended to complete the original report. Based on the information provided in Exhibit 14-A, the estimated cost of the additional work to revise the report is $15,000. (Given that the Board authorized up to $60,000, but B-E/GEI spent only $53,700 to complete its report, the net additional spending authorization staff requests is $8,700 i.e. $15,000 minus $6,300, equals $8,700.) This would result in a $15,000 amendment to the existing B-E/GEI contract. Funds to complete the report in the amount of $60,000 were included in the Mid-Year 2005-2006 Budget (Project 1-2-1.C), but no funds to revise the report are included in the Fiscal Year 2006-2007 Budget adopted at the June 22, 2006 Board meeting. Therefore, it is recommended that if the Board approves the additional work, the $15,000 cost should be funded out of budgeted 2006-07 contingency funds.

EXHIBITS

14-A Work Effort Estimate and Cost Estimate, Bookman-Edmonston/GEI Consultants

14-B September 12, 2006 memorandum from District Engineer Andrew M. Bell to Board of Directors, “Summary of Comments on June 26, 2006 report by Bookman-Edmonston/GEI Consultants, ‘Seawater Desalination Projects Evaluation’”

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