A RESOLUTION AUTHORIZING THE CITY MANAGER TO FILE GRANT AND LOAN APPLICATIONS TO FUND CONSTRUCTION OF RECYCLED WATER PIPELINES THROUGH THE AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009

SUBJECT:

ADOPTION OF A RESOLUTION AUTHORIZING THE CITY MANAGER TO FILE GRANT AND LOAN APPLICATIONS TO FUND CONSTRUCTION OF RECYCLED WATER PIPELINES THROUGH THE AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009

RECOMMENDATION: That the City Council adopt the attached resolution authorizing the City Manager to file grant and loan applications to fund construction of recycled water pipelines through the American Recovery and Reinvestment Act of 2009.

COUNCIL GOALS: Develop Strategies And Take Actions To Minimize The Negative Impacts Of The Global Financial Downturn On Ontario’s Economy And The City’s Fiscal Health

Invest In The City’s Infrastructure (Water, Streets, Sewers, Parks, Storm Drains And Public Facilities)

Pursue City’s Goals And Objectives By Working With Other Governmental Agencies

FISCAL IMPACT: The American Recovery and Reinvestment Act of 2009 (ARRA) provides funding opportunities for recycled water projects that will be administered by the State Water Resources Control Board through the Clean Water State Revolving Fund (CWSRF). Possible funding programs include the State Revolving Fund Loan Program (SRF), a low interest loan program, and ARRA grant funds. Recycled water pipeline projects included in future Phases 3 and 4 of the City’s recycled water plan, with estimated costs of $13 million, are currently listed on the 2008-2009 CWSRF Project Priority List. Adoption of the attached resolution allows the City to initiate its participation in the CWSRF program; however, execution of any grant or loan agreements and approval of related project budgets will be subject to future Council action.

BACKGROUND: The City’s 2005 Urban Water Management Plan (UWMP) identifies the use of recycled water as a critical element in meeting the City’s growing demand for water. Expanding the use of recycled water provides a long-term sustainable water source that is not subject to the same limitations under drought conditions as other potable water supplies. Recycled water is used for irrigation and industrial applications as approved by the California Department of Public Health, and will result in significant reductions in the City’s 2005 UWMP long term reliance on more expensive and increasingly less reliable imported water supplies.

In November 2007, the Inland Empire Utilities Agency (IEUA) adopted its Regional Recycled Water Three-Year Business Plan with support from the City and other member agencies. This plan was implemented to mitigate possible future potable water shortages due to drought conditions and possible reduction in imported water supplies from Metropolitan Water District (MWD). In conjunction with the goals of IEUA’s Regional program and in an effort to reduce the City’s potable water demand, the City’s recycled water program was developed to identify high water users in the Old Model Colony that would benefit from recycled water use and identify the distribution pipelines necessary to serve the targeted sites. These sites include schools, parks, right-of-way landscaping, commercial/industrial landscape areas, and sites using water for industrial processes.

Based on the availability of recycled water and proximity to IEUA’s facilities, the City developed a five-year program to install recycled water pipeline and expand recycled water service to the community. The program consists of four phases totaling approximately 14 miles of pipeline, providing about 3,050 acre-feet per year of recycled water (seven percent of the City’s current total water demand), and initially targets approximately 150 customers for service. Phase 1 construction was recently completed with capacity to provide approximately 800 acre-feet per year of recycled water to about 20 customers. Phase 2 is included in the adopted CIP and will provide an additional 850 acre-feet per year of recycled water to about 40 customers. Phases 3 and 4 are estimated to cost approximately $13 million and will provide an additional 1,400 acre-feet per year of recycled water to about 90 customers.

Recycled water service for the remainder of the Old Model Colony and the New Model Colony is being planned for as part of the Water and Recycled Water Master Plan update authorized by City Council in December 2008.

STAFF MEMBER PRESENTING: Ken Jeske, Utilities General Manager