HomeMy WebLinkAboutItem 16 - Appropriation Adjustment and Amendment to the Agreement for the Automated Metering Infrastructure ProjectPublic Works Agency
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Item # 16
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
July 16, 2024
TOPIC: Automated Metering Infrastructure Project
AGENDA TITLE
Appropriation Adjustment and Amendment to the Agreement with Aqua -Metric Sales
Company to Add Funds to the Automated Metering Infrastructure Project (Project No.
16-6460) (Non -General Fund)
RECOMMENDED ACTION
Approve an appropriation adjustment to recognize $15,000,000 of prior -year fund
balance in the Public Works Water Revenue, Prior Year Carryforward and Water
Utility Capital, Transfer from Fund 060 revenue accounts, and appropriate to the
Water — Interfund Transfer, Transfer to Fund 066 and Water Utility Capital Projects,
Water Capital Project expenditure accounts (Requires five affirmative votes).
2. Authorize the City Manager to execute a first amendment with Thirkettle
Corporation, dba Aqua -Metric Sales Company, to increase the not -to -exceed
amount by $6,000,000, including a contingency of $1,500,000, for a new not -to -
exceed amount of $35,683,230 (Agreement No. A-2024-XXX).
3. Approve an amendment to the Fiscal Year 2024-2025 Capital Improvement Program
to include $15,000,000 in construction funds for the Automated Metering
Infrastructure Project (Project No. 16-6460).
GOVERNMENT CODE §84308 APPLIES: Yes
DISCUSSION
The Public Works Agency oversees the daily operations and maintenance of the City's
water and sanitary sewer systems. The water system is comprised of approximately 480
miles of water main, 21 groundwater wells, seven pump stations, 10 reservoirs with a
storage capacity of 49 million gallons, four pressure regulating stations, and seven
connection points to the Metropolitan Water District. The system has an average daily
demand of 30 million gallons from its roughly 45,150 metered service connections.
On November 17, 2020, Council approved an agreement for $29,683,230 with Thirkettle
Corporation, dba Aqua -Metric Sales Company, for the delivery of the Automated
Metering Infrastructure (AMI) Project. The AMI Project, which is currently underway, will
Automated Metering Infrastructure Project
July 16, 2024
Page 2
replace or retrofit all of the existing, manually -read water meters in the City with smart
meters capable of communicating water consumption and other system information to
both the utility and the customer. Additional components of the AMI Project are the
installation of communications equipment to receive water system data, billing software
system upgrades, and other software integrations to allow for full utilization of available
water data.
Due to the age and condition of the City's water system infrastructure, especially
appurtenances that house or control the delivery of water to meters, the AMI Project has
incurred additional expenses in order to correct related deficiencies. Although staff
anticipated some supplemental work would be needed and attempted to budget
appropriately with both the contingency for the AMI Project's master agreement, as well
as with the use of third -party contractors, the amount of work and materials needed to
make prudent repairs to the infrastructure has far exceeded initial projections. The
requested amendment with Aqua -Metric (Exhibit 1) will add $6,000,000, including
$1,500,000 in contingency, to cover already -determined expenditures, as well as
establish a new contingency fund for future unknown costs related to the repair of the
water system infrastructure.
Finding cost-effective solutions to maintain and improve the City's water system
infrastructure has been a priority for the Division. To date, the Division has been
awarded $1,500,000 in grant funds from the Federal Bureau of Reclamation,
$4,000,000 in grant funds from the California State Natural Resources Agency, and a
$10,117,365 low -interest loan from the California State Water Resources Control Board
for the AMI Project. However, due to the factors mentioned above, as well as rapid
inflation driving up project -related material costs, additional funds are needed in order to
complete the project as -intended. On June 4, 2024, the City Council approved the sale
of Water Revenue Bonds to provide the capital needed to fund several Water
Resources Division projects, including the AMI Project.
To date, only $25,894,948 has been appropriated to the project; the approval of the
recommended actions will appropriate an additional $15,000,000 to the project for a
total of $40,484,948, and amend the FY 24-25 CIP Plan (Exhibit 2). The additional
funds will be used to cover the previously -mentioned increased costs incurred under the
agreement with Aqua -Metric Sales Company, as well as allow for needed rehabilitation
on the City's water meter vaults and appurtenances.
Proiect Delive
The estimated total project delivery costs include work being performed under the
agreement with Aqua -Metric Sales Company, project management and software
integration support services, as well as supplemental work to replace or rehabilitate
aged water meter infrastructure.
Automated Metering Infrastructure Project
July 16, 2024
Page 3
As indicated in the Cost Analysis (Exhibit 3) and as summarized in the table below, the
estimated total construction delivery cost of the project is $40,484,948.
Project Item
Total
Construction Contract Bid Amount
$35,683,230
Project Administration, Inspection, Testing
$2,000,000
Contract Contingencies
$2,801,718
Total Estimated Project Delivery Cost
$40,484,948
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
With the approval of the requested appropriation adjustment, a portion of the
accumulated Water fund balance will be appropriated for spending in the Water Utility
Capital Projects, Water Capital Project expenditure account (No. 06617647-66301). The
spendable portion of the Water fund balance is estimated to be $40 million as of June
30, 2024, which includes the water bond proceeds, is sufficient to allow for the
recommended appropriation of $15,000,000.
Approval of the requested agreement amendment with Thirkettle Corporation, dba
Aqua -Metric Sales Company, will add $6,000,000, including $1,500,000 in contingency
funds, to agreement A-2020-231, for a new agreement total not to exceed $35,683,230.
Funds are budgeted and available for expenditures for FY 2024-25 pending Carry
Forward process and City Council approval. Any remaining balances not expended at
the end of the current fiscal year will be presented to the City Council for approval to
carry forward to FY 2025-26.
Fiscal
Accounting Unit-
Fund
Accounting Unit,
Amount
Year
Account No.
Description
Account Description
(Project No.)
Original Project Budget
2024-25
06617647-66301
Acquisition &
Water Utility Capital
Projects, Water Capital
$25,484,948
(16-6460)
Construction
Project
Appropriation Adjustment
2024-25
06617647-66301
Acquisition &
Water Utility Capital
Projects, Water Capital
$15,000,000
(16-6460)
Construction
Project
Automated Metering Infrastructure Project
July 16, 2024
Page 4
Fiscal
Accounting Unit-
Fund
Accounting Unit,
Amount
Year
Account No.
Description
Account Description
Project No.
Total:
$40,484,948
EXHIBIT(S)
1. Agreement Amendment
2. CIP Worksheet
3. Cost Analysis
Submitted By: Nabil Saba, Executive Director of Public Works
Approved By: Alvaro Nunez, Acting City Manager
EXHIBIT 1
FIRST AMENDMENT TO AGREEMENT WITH THIRKETTLE CORPORATION DBA
AQUA -METRIC SALES COMPANY
THIS FIRST AMENDMENT to the above -referenced agreement is entered into on July 16, 2024,
by and between Thirkettle Corporation, doing business as Aqua -Metric Sales Company
("Contractor") and the City of Santa Ana, a charter city and municipal corporation organized and
existing under the Constitution and laws of the State of California ("City").
RECITALS
A. On November 17, 2020, the parties entered into Agreement No. A-2020-231
("Agreement") to provide and install a fully functioning Advanced Metering Infrastructure
(AMI)/ Meter Data Management (MDM) system, and related software and services. The
total compensation under the Agreement was $29,683,229.61, which included $1.5 million as a
contingency fund.
B. During the course of the Agreement, the age and condition of the City's water system
infrastructure has resulted in additional expenses beyond the anticipated scope of the
original Agreement, requiring additional funds.
C. The parties now wish to amend the Compensation section in the Agreement to increase the
total compensation under the Agreement by $6,000,000, including replenishment of the
contingency fund ($1.5 million). No other changes are contemplated by this First
Amendment.
The Parties therefore agree:
1. Section 2.a., Compensation, is amended to read as follows:
City agrees to pay, and Contractor agrees to accept as total payment for its services for
City, the rates and charges identified in Parts, Material & Pricing - Appendix A. The
total amount to be expended under this Agreement, including any contingency funds, shall
not exceed $35,683,229.61 during the term of this Agreement, including any extension
periods exercised under Section 3.
2. Except as modified by this First Amendment, all terms and conditions of the Agreement shall
remain in full force and effect.
[signature page follows]
Page 1 of 2
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to the
Agreement on the date and year first written above.
ATTEST
JENNIFER L. HALL
City Clerk
APPROVED AS TO FORM
Sonia R. Carvalho
City Attorney
By:
KyJ04ellesen
Assistant City Attorney
RECOMMENDED FOR APPROVAL
N a b i l Saba Date: 024.0.0 1 Nab:09:2 Saba
Date: 2024.07.0915:09:26
-07'00'
Nabil Saba
Executive Director
Public Works Agency
CITY OF SANTA ANA
ALVARO NUNEZ
Acting City Manager
CONTRACTOR
Tommy Thirkettle
President/CEO
Page 2 of 2
PROJECT TITLE:
Automated Metering Infrastructure
PROJECT CATEGORY:
Utility/Drainage/Lighting
Improvements
Water Improvements
LOCATION MAP
N
CITY OF SANTA ANA FY 24/25CIP
CAPITAL IMPROVEMENT PROJECT WORKSHEET
PROJECT DESCRIPTION:
Installation of automated metering infrastructure (AMI)
communications equipment; replacement or retrofit of all water
meters within the City with smart meters; AMI software integration
and billing system upgrade.
PROJECT NEED:
Upgrade of City's water metering and billing system infrastructure.
PROJECT COSTS FY 24125 FY 25/26 FY 26/27 FY 27/28 FY 28/29 FY 29/30 FY 30/31
Construction 15,000,000 - - - - - -
TOTAL 15,000,000 - -
CITYWIDE SOURCE OF FUNDS FY 24/25 FY 25/26 FY 26/27 FY 27/28 FY 28/29 FY 29/30 FY 30/31
WATER CAPITAL 15,000,000 - - - - - -
TOTAL 15,000,000 - - -
AGENCY: DIVISION: CONTACT: DATE:
Public Works Water Resources Armando Fernandez, Senior Civil Engineer 24-Jun-2024
EXHIBIT 3
CONSTRUCTION OF PROJECT NO. 16-6460: AUTOMATED METERING
INFRASTRUCTURE
Construction contract — materials and installation (Aqua -Metric)
$
35,683,230.00
Project administration and support services
$
2,000,000.00
Construction — infrastructure replacement and rehabilitation
$
2,801,718.00
Total Project Delivery Cost
$
40,484,948.00