ITEM:		CONSENT CALENDAR
2.	CONSIDER expenditure of Budgeted, REIMBURSIBLE Funds for WATER PROJECT 2 Aquifer Storage and Recovery (ASR) Well CONSTRUCTION
Meeting Date:			May 21, 2012	Budgeted:	Yes
From:			David J. Stoldt,	Program/	Water Supply
			General Manager	Line Item No.:	1-2-1 B
Prepared By:			Joe Oliver	Cost Estimate:	$2,206,600 (Cal-Am reimbursable)
General Counsel Review: NA
Committee Recommendation: The Administrative Committee reviewed this item on May 14, 2012 and recommended approval.
CEQA Compliance: N/A

SUMMARY: The Board will consider authorization to enter into a contract with the successful bidder for construction of the ASR-4 well at the Water Project 2 site located at Seaside Middle School in Seaside. This work is part of the planned expansion of the Seaside Basin ASR Project that the Monterey Peninsula Water Management District (MPWMD or District) and California American Water (Cal-Am) are cooperatively pursuing to augment the water supply for the Monterey Peninsula community.

The planned work entails the drilling of a pilot borehole, installation of well casing, screen and gravel pack, development and testing of the well, provision of a pump, motor, flow control valve and temporary discharge piping. A bid notice for the drilling and construction of the new ASR-4 well by a licensed C-57 drilling contractor was first advertised on April 26 and the bid period is currently scheduled to close on May 16. By easement restriction, the well construction must occur during the summer school break period to avoid disruption of school activities. Due to the tight timing of the needed approvals for this project, the results from the bid opening for the well drilling and construction work are not yet available. Accordingly, the authorization requested is based on the estimated cost, as described below.

MPWMD began Water Project 2 planning work in 2008, and completed the first phase of development with the installation of dedicated monitor wells at the Middle School site in 2009. Since then, MPWMD and Cal-Am have been working jointly to obtain Carmel River water rights for diversions to storage at the site, and for land-use approval (site easement was granted to Cal-Am in 2010). The first of the two planned ASR wells was constructed in 2010 and appurtenant facilities were installed in 2011. Injection testing was initiated at the first site well (ASR-3) in 2012. Also in 2012, the District completed the necessary California Environmental Quality Act (CEQA) documentation (Phase 1 ASR Project EIR addendum) to for the permanent Water Project 2 site.

The Board’s authorization of this item is with the understanding that the District and Cal-Am will secure a cost reimbursement agreement for this item prior to project initiation.

RECOMMENDATION: Upon receipt of bids from qualified C-57 licensed drilling contractors, District staff recommends that the General Manager be authorized to enter into a contract with the lowest responsive and responsible bidder for construction of the Water Project 2 ASR-4 well at the Seaside Middle School site. This authorization will include: (a) mobilization, sound wall, drilling, well construction, testing, (b) ASR well pump and motor, (c) ASR well flow control valve, and (d) provision of temporary discharge piping. The total estimated cost for this phase of the project is $2,206,600. This amount includes a 20% contingency for unanticipated cost variations.

District staff will proceed with executing a contract for this work under this item if the well construction bid is within 20% of the estimated cost. The Board’s authorization of this item is with the understanding that the cost for this item will be reimbursed by Cal-Am through reimbursement agreement with the District.

BACKGROUND: In August 2008, the District began discussions with the Monterey Peninsula Unified School District (MPUSD) for potential use of an unused portion of the Seaside Middle School property for potential expansion of the Seaside Basin ASR program (i.e., Phase 2 or Water Project 2). In October 2009, the District drilled an exploratory borehole and constructed a dedicated monitor well array at the site. This work confirmed that the site would be suitable for drilling a full-scale ASR test well. The next step in development of this project was to construct and test a full-scale ASR Test well at the site, which was completed in 2010. This first well at the site is now known as ASR-3. This nomenclature is to minimize confusion and/or mislabeling of data associated with the ASR-1 and 2 existing wells at the nearby Water Project 1 (Santa Margarita) site that is located approximately 1,000 feet to the southeast of the Middle School site. The current timing for ASR-4 well construction is one year ahead of the previous planned schedule. This accelerated schedule comports with the recent California Public Utilities Commission (CPUC) administrative law judge’s proposed decision that includes authorization for Cal-Am to assign funding for the Water Project 2 ASR expansion in a memo account. If the ASR-4 well is not installed this summer, the next opportunity will be during the school’s 2013 summer break, which would complicate other facility construction work planned for this same period.

Assuming successful completion and testing of the ASR-4 well, it is planned to continue with development of this site into a permanent ASR facility, similar to the existing Water Project 1 site. This will entail completion of the necessary engineering designs, environmental review, permitting and construction of permanent facilities, including: (a) a backflush percolation system, (b) underground utility pipelines, (c) electrical control building, and (d) paved access, fencing and landscaping. The current schedule calls for completion of the permanent facilities at the Middle School ASR site in December 2013. There will be no water treatment facilities at the Middle School ASR site; all water from this site will be treated prior to distribution into the Cal-Am system at the offsite Water Project 1 (Santa Margarita) ASR Facility building.

IMPACT TO STAFF/RESOURCES: A significant staff effort has been expended in planning, coordinating, analyzing and overseeing work on the District’s ASR testing program in the Seaside Basin. It is intended to expand that level of effort with the implementation of this next phase of ASR expansion in the basin. A cost of $261,300 is currently assigned for Water Project 2 site planning in the District’s Fiscal Year 2011-2012 budget (i.e., items under Line 1-2-1 B 3). This amount is not enough to cover for the entire ASR-4 well construction project. However, this budgeted amount exceeds the limited expenditure anticipated on this project during the remaining part of FY 2011-2012 (i.e., mobilization, sound wall and conductor casing). The remaining anticipated project expenditures associated with ASR-4 construction are being included in the FY 2012-2013 budget as a Cal-Am reimbursable expense. As stated above, the District will not proceed with authorization of the contract award for this work until the Cal-Am reimbursement funding for it is secured.

EXHIBITS

None

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