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Home My WebLink About6 Water Pipeline Change order Agenda Item # �0 TR UCKEE DONNER Staff Report To: Board of Directors From: Peter Holzmeister Date: June 27, 2007 Subject: Funding for contract change order Why this matter is before the Board: This matter relates to selecting a method to fund a change order to the water pipeline replacement project underway in Tahoe Donner. The question was unresolved at the meeting of May 16, 2007. 1 was asked to get an opinion from Bond Counsel and report back to the Board to take action on it. History: You will recall that Neil Kaufman made a presentation to the Board describing how eight water service laterals froze during the very cold month of January this past winter. He recommended that the Board approve a contract change order to replace and lower those laterals to avoid freezing in the future. The Board approved the change order, but was uncertain as to how to provide funding for the work. I had recommended that the 2006 COP was the appropriate source for funds. After some discussion, the Board asked me to get an opinion from Bond Counsel to make sure that this funding would be legally permissible. New information: Attached is a letter from David Casnocha, District Bond Counsel, stating that we would be permitted to use the 2006 COP funds to pay for replacement of service laterals. Also attached for your review is the letter I sent to him and the relevant excerpts from your minutes of that meeting. Recommendation: I recommend that the Board approve use of the 2006 COP project fund to pay for the replacement of the eight service laterals in contract change order number 1 to the District Pipeline Replacement Project—2007—Contract B. -IN 2 5 2007 STRADLING YOCCA CARLSON & RAUTH A PROFESSIONAL CORPORATION ORANGE COUNTY (949)725-4000 ATTORNEYS AT LAW SAN DIEGO 44 MONTGOMERY STREET,SUITE 4200 (858)720-2150 DAVID G.CASNOCHA SAN FRA DIRECT DIAL:(415)283-2241 SAN FRANCISCO,CA 94104 (415)283-22403-2240 DCASNOCHAQSYCR.COM TELEPHONE(415)283-2240 SANTA BARBARA (805)564-0065 FACSIMILE(415)283-2255 SANTA MONICA (310)434-2788 June 21, 2007 Peter L. Holzmeister General Manager Truckee-Donner Public Utility District P.O. Box 309 11570 Donner Pass Road Truckee, CA 96160-0309 Re: Truckee Donner Public Utility District Refunding Revenue Certificates of Participation (Water System Improvement Projects) Series 2006 Dear Peter: In response to your letter dated May 17, 2007,the Truckee Donner Public Utility District(the "District") is permitted to determine the exact pipelines to be replaced under the "Pipeline Replacement Projects (2006-2010)" descriptive component listed in the Installment Purchase Agreement relating to the $26,570,000 Truckee Donner Public Utility District Refunding Revenue Certificates of Participation (Water System Improvement Projects), Series 2006 (the "2006 Certificates"). The "eight water service laterals" described in your letter are existing pipelines of the District and the replacement thereof falls, within the scope of the "Pipeline Replacement Projects (2006-2010)" description. Consequently, the District may expend proceeds from the 2006 Certificates on the replacement of the eight water service laterals. Please do not hesitate to contact me if you have any further questions or need additional clarification. Best regards, David G. Casnocha DGC:th DOCSSF/64325v1/022925-0017 May 17, 2007 David Casnocha Stradling Yocca Carlson and Roth 44 Montgomery St, Ste 4200 San Francisco, CA. 94104 Dear David, We would like your opinion on a question that has come up. It relates to the District's 2006 COP issue that provides funding for water system improvements. The question is can the District replace eight water service laterals using COP funds? The eight service laterals that need to be replaced were never discussed leading up to issuance of the COPs. We did not anticipate replacing them until they froze during the extreme cold temperatures Truckee experienced during January of 2007. The Description of Project in Appendix B of the Installment Purchase Agreement defines one component of the 2006 Project as "Pipeline Replacement Projects (2006-2019)." The COP documents do not attempt to specify precisely which pipelines would be replaced. The idea has been that we will determine the precise pipelines to be replaced each year based on every changing need. The eight service laterals that we will replace are pipeline replacements. However, the above statements are just my quick research of the COP documents and I am not sure that I did a thorough job, so we ask for your more informed opinion. If you need any additional information please call me at (530) 582-3916. Very truly yours, Peter L. Holzmeister CONSIDERATION OF A CONTRACT CHANGE ORDER TO THE DISTRICT PIPELINE REPLACE- MENT PROJECT — 2007 — CONTRACT B. a. This item related to replacing eight water service laterals in the Tahoe Donner area not currently included in the contract. The Board discussed whether the 2006 Water COP can be used as a funding source for the eight wa- ter service laterals. Counsel Gross suggested staff contact bond counsel for an opinion. If bond coun- sel comes back and says the COP is not appropriate to fund the eight water service laterals, the Board will need to take action and change the funding source. emi moved and Director A uera seconded, a motion to authorize the Water Department to Director H g 9 issue a Field Change Order for eight service lateral replacements (along with new meter boxes) in the amount of about $40,000 into the District Pipeline Replacement-2007-Contract B project; payment to Hard Line Excavating to be made after work is performed and value reflected in the reconciliation of Bid Quantities vs. Actual Quantities at the end of the project; and funding for Field Change Order to be determined after checking with bond counsel for use of 2006 Water COP. ROLL CALL: All Directors, aye. SO MOVED. CONSIDERATION OF A REPORT ON BIDS RECEIVED AND POSSIBLE AWARD OF A CON- TRACT FOR THE PURCHASE OF ELECTRIC SYSTEM WIRE AND CABLE. a. This item relates to purchase of electric system wire and cable that is anticipated to be needed to accomplish pro- jects planned in 2008. Director Aguera moved and Director Hemig seconded, a motion to approve the following schedules as shown below for the purchase of wire and cable from HD Supply for the District's electric system: Unit Price Extended Price Schedule Quantit feet (per 1,000 ft Not to Exceed' A 9,000 $949.00 $8,541.00 B 10,000 $2,582.00 $25,820.00 C 1,000 $1,412.00 $1,412.00 D 1,000 $2,236.00 $2,236.00 E 2,000 $4,105.00 $8,210.00 F 2,000 $5,718.00 $11,436.00 G 1,500 $1,154.00 $1,731.00 Total $59,386.00 ROLL CALL: All Directors, aye. SO MOVED. WORKSHOP ITEM DISCUSSION OF RETAINING THE SERVICES OF A TEMPORARY GENERAL MANAGER. a. This item relates to discussion of the process for employing an interim General Manager until a new permanent General Manager is hired. Peter Holzmeister spoke with the Northern California Power Agency about an interim General Man- ager. They have helped agencies by placing a staff member with a district as a temporary. Mr. Holzmeister would like the Board to direct Nancy Waters to start a dialog with NCPA about assigning a person to the Truckee Donner PUD as an interim General Manager. The PUD could then enter into an agreement to set forth the cost and details of the scope of services. 4 May 16, 2007- minutes