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HomeMy WebLinkAboutProtest Objecting to Southern California Water Company - SCW 7Tm£ CITY OF HUNTINGTON BEACH l- rern $�5 �.VN��ra�� MEETING DATE: August 4, 2003 DEPARTMENT ID NUMBER: C 0 �.1F��(0�- Council/Agency Meeting Held: ® 1�To3 Deferred/Continued to: Approved ❑ Conditionally Approved ❑ Denied _ City Clerk's Sign ature Council Meeting Date: August 4, 2003 Department ID Number: CA 03-17 CITY OF HUNTINGTON BEACH REQUEST FOR COUNCIL ACTION G `_ w SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS SUBMITTED BY: JENNIFER MCGRA ity Attorney PREPARED BY: JENNIFER MCGRAT Vci y Attorney SUBJECT: Adopt Resolution No.' ;k�0`3—S , Denying the Water Pipeline Franchise Application of Southern California Water Company Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: Whether to deny a water pipeline franchise application of Southern California Water Company intended to serve a residential development on the Bolsa Chica Mesa Funding Source: N/A Recommended Action: Adopt Resolution No. A Resolution of the City Council of the City of Huntington Beach Denying the Application of Southern California Water Pipeline Franchise. Alternative Action(s): Do not adopt Resolution No. aou3—S'� denying Franchise Application Analysis: Hearthside Homes owns the Bolsa Chica Mesa. The Mesa lies within Orange County, although it also is within the City's sphere of influence. For many years, Hearthside has been attempting to place a residential development on the property. In order to develop the property, Hearthside must obtain domestic water service. A brief history of this issue is as follows: —�� 03-So Cal Water -7- 7/29/2003 7:59 AM d REQUEST FOR COUNCIL ACTION MEETING DATE: August 4, 2003 DEPARTMENT ID NUMBER: CA 03-17 March 1997 — Southern California Water Company (SCWC) agrees to provide water and sewer service to the to the Bolsa Chica Mesa residential development project pursuant to an agreement with a System Operation Maintenance Agreement with Signal Bolsa (Hearthside's predecessor). November 1998 — SCWC applies to the California Public Utilities Commission (CPUC) for a Certificate of Public Convenience and Necessity (CPCN) to serve Bolsa Chica. October 2000 — CPUC grants the CPCN by a 3-2 vote. The approval contemplates a 1,235 unit residential development. November 2000— The Coastal Commission reconsiders its 1997 land use plan for the Mesa following the decision in the Bolsa Chica Land Trust v. Superior Court (1999) 71 Cal.App.4t" 493, which disapproved that plan. The Coastal Commission then revises the 1997 LCP to limit the 1,235 units to the upper bench of the Mesa, designates the lower bench as a conservation area, and imposes a "buffer", between development on the upper bench and conservation on the lower bench. The County is then notified that it must accept the revisions within six months, or the plan approval would expire. When the County rejects the revisions, Signal Landmark (Hearthside's corporate parent) and'Hearthside Homes sues the Commission. (San Diego Case No. GIC 764965.) February 1, 2002 — SCWC applies for a franchise with the City pursuant to the 1937 Act.to install a pipeline under the City streets to serve Bolsa Chica. February 2002 — The trial court rejects Hearthside's suit in Signal Landmark v. California Coastal Commission, and grants judgment in favor of the Coastal Commission. July 23, 2002 — Hearthside submits a new plan for 378 single-family units only on the upper bench of the Mesa, known as the Brightwater development. Orange County recommends that the Coastal Commission approve Hearthside's plan in July 2002. The application is currently pending before the Coastal Commission. October 21, 2002 — City Council holds Study Session to consider franchise application. November 6, 2002 — City Council votes to "delay and take no action relative to working out a franchise agreement at this time." Then-Mayor Pro Tem Boardman provides two reasons for the deferral. First, the recent passage of Proposition 50 authorized State funding to purchase Bolsa Chica as an environmental preserve. Further, the lawsuit against the California Coastal Commission concerning the development project was pending. Because both the pending litigation and 03-So Cal Water -8- 7/29/2003 7:59 AM dL REQUEST FOR COUNCIL ACTION MEETING DATE: August 4, 2003 DEPARTMENT ID NUMBER: CA 03-17 Proposition 50 put the eventual completion of Bolsa Chica Mesa development in question, there was no reason to act on SCWC's application at that time. January 23, 2003 — SCWC files suit to challenge the City's decision, entitled Southern California Water Company v. City of Huntington Beach, et al., Orange County Superior Court Case No. 03CCO2021. At issue in this suit was the decision of the City Council to defer consideration of Southern California Water Company's application for a franchise to serve Hearthside's proposed development on the Bolsa Chica Mesa. June 13, 2003 - The Court grants the writ and orders the City to determine by August 6, 2003 whether to grant or deny the franchise. The Court order states that the City may only deny the franchise "in a manner that is not in conflict or inconsistent with the decision of the CPUC to approve the pipeline." The Court order further states that if the City grants the franchise, the terms of any franchise must be consistent with the City's procedures for issuing water franchises, and that if the City does not have any such procedures, they must be consistent with the State general laws, which include the 1937 Franchise Act. The Court Order is ambiguous in at least two respects.. First, the-Court decision never explains what would be a franchise denial in conflict with the CPUC decision. In fact, the CPUC decision never orders the City to grant a franchise, nor even addresses the subject. Consequently, while the Court implies that there may be a conflict between franchise denial and the CPUC decision, it is the opinion of the City Attorney that denial of a franchise is consistent with the CPUC decision. It is not surprising the CPUC does not address a Franchise because, as a public utility, SCWC has the authority to file a condemnation action to obtain an easement in the city streets. (Water corporations are specifically authorized to employ eminent domain. (Public Utilities Code § 620.) Consequently, there was no reason for the CPUC to address franchises when condemnation was available. (For example, in a similar situation where the City of Compton tried to compel Shell Oil to negotiate a franchise, the Court held that Shell had the option to condemn the right of way because it was operating a public utility. (Shell California Pipeline Company v. City of Compton (1995) 35 Cal.App.4th 1116.)) The second ambiguity in the Court's Order is what constitutes the City's "procedures for issuing franchises." City Charter Section 615 requires that franchises be granted by ordinance; that is a procedure by itself. On the other hand, while the City has granted oil franchises pursuant to an enabling ordinance (Chapter 5.44 of the Municipal Code), other franchises were granted directly by ordinance (e.g., Refuse Collection.) The Court was aware of the City Charter, but never explained if it was a procedure for issuing franchises. 3 03-So Cal Water 7/29/2003 7:59 AM REQUEST FOR COUNCIL ACTION MEETING DATE: August 4, 2003 DEPARTMENT ID NUMBER: CA 03-17 The Court's ruling gives the City the following options: A. Grant the franchise pursuant to the 1937 Franchise Act. Under the 1937 Franchise Act, the City's revenues in connection with the franchise would be minimal, at best amounting to only a few thousand dollars per year. However, the 1937 Act includes lengthy and time-consuming public hearing proceedings that could not be completed by August 6, 2003, even if the City had began immediately taking the June 13, 2003 order. B. Direct staff to negotiate a favorable franchise, which may or may not meet with the Court's approval. C. Deny the franchise on grounds that are not in conflict or inconsistent with the CPUC's decision. D. Appeal the decision. Any appeal must be filed by no later than August 12, 2003. It is recommended that the Council deny the franchise application. The basis for the denial is as follows: 1. The CPUC granted the CPCN as an alternative to City water service. The CPUC found that the City was the environmentally superior alternative to SCWC service, but because the City had not entered into a water services agreement with Hearthside, only SCWC was "ready, willing, and able" to provide water service. 2. Because the CPUC chose SCWC over the City, despite City service being environmentally preferable, it is reasonable to conclude that the CPUC contemplated that SCWC would not apply to the City for further discretionary approvals, such as a pipeline franchise. To the contrary, the CPUC was well aware SCWC could condemn a pipeline easement instead of obtaining a franchise because water corporations are specifically authorized to employ eminent domain pursuant to Public Utilities Code § 620. Further, the CPUC was aware of the provision in the SCWC/Hearthside agreement authorizing use of eminent domain. Consequently, denial of a franchise is consistent with the CPUC decision. 3. In November 2002, California voters passed Proposition 50, which provided funds for acquisition of the Bolsa Chica Mesa for park and habitat preservation. All real property acquired pursuant to Proposition 50 must be acquired from willing sellers. 4. On March 26, 2003, the Wildlife Conservation Board contracted with James Donahue for an appraisal of Hearthside's Bolsa Chica Mesa property. Hearthside Homes provided input to the selection of the appraiser, signaling that they are a willing seller. 5. If the Bolsa Chica Mesa were acquired, there would no longer be any need for the water pipeline. 03-So Cal Water 7/29/2003 7:59 AM REQUEST FOR COUNCIL ACTION MEETING DATE: August 4, 2003 DEPARTMENT ID NUMBER: CA 03-17 6. The City Counsel supports public acquisition of the Bolsa Chica Mesa. Granting a franchise at this time may interfere with public acquisition by increasing the appraised value of the Mesa. 7. Because there is no approved development for the Bolsa Chica Mesa, there is no reason for the City to issue a franchise at this time. Environmental Status: Not Applicable Attachment(s): NumberCity Clerk's Page . Description 1 A Resolution of the City Council of the City of Huntington Beach Denying Franchise .Qs . Q o 2 Wildlife Conservation Board's Response to Request for Public Record: 1. Contract for Hiring Real Estate Appraisers 2. Letter from Howard Coleman of Nossaman, Gunther, Knox & Elliott, dated 1/29/03 (Attorney for Hearthside Homes) 3. Letter from Howard Coleman of Nossaman, Gunther, Knox & Elliott, dated 12/17/02 (Attorney for Hearthside Homes) RCA Author: SFF 03-So Cal Water 7/29/2003 7:59 AM ATTACHMENT NO . 1 RESOLUTION NO. 2003-57 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HUNTINGTON BEACH DENYING THE APPLICATION OF SOUTHERN CALIFORNIA WATER COMPANY FORA WATER PIPELINE FRANCHISE WHEREAS, Hearthside Homes owns the property located in the County of Orange known as the Bolsa Chica Mesa; and In March 1997, Southern California Water Company ("SCWC") and Signal Bolsa (Hearthside's predecessor) entered into a "System Operation and Maintenance Agreement," to provide that SCWC would offer water and sewer service to Signal Bolsa's Bolsa Chica Mesa residential development; Section 1.6 of the Agreement provided that, upon the request of Hearthside, "SCWC will exercise the power of eminent domain to acquire any right of way reasonably relate to and required for the Pipeline;"and In November 1998, SCWC applied to the California Public Utilities Commission ("CPUC") for a Certificate of Public Convenience and Necessity ("CPCN") that would permit SCWC to .provide water and sewer service to a 1,235. unit residential development,on the upper:and lower portions of Bolsa Chica Mesa. In October 2000,the CPUC granted the CPCN; and In November 2000, the California Coastal Commission rejected Hearthside's land use plan for a 1,235 unit residential development; and After it had obtained CPUC approval, SCWC waited a year and a half, until February 1, 2002, to apply to the City for a franchise pursuant to the 1937 Franchise Act to install a pipeline under the City's streets to serve the Bolsa Chica Mesa; and On July 23, 2002, Orange County recommended that the Coastal Commission approve a Hearthside's new proposal for the Bolsa Chica Mesa, known as the Brightwater development, comprising 378 single-family units on the upper bench of the Mesa. To date, that application remains pending before the Coastal Commission; and The City Council held a lengthy study session on October 21, 2002 to consider SCWC's franchise application. At the study session, SCWC's general manager.acknowledged that SCWC could condemn a right of way; and The City Council formally considered SCWC's franchise application at its next meeting on November 6, 2002. At that meeting, the City's Mayor Pro Tern moved to "delay and take no action relative to working out a franchise agreement at this time"; and 1 GARES0LUW2003lscscc franchise.doc On January 23, 2003, SCWC filed the action entitled Southern California Water Company v. City of Huntington Beach, Orange County Superior Court Case No.030002021; and On June 13, 2003,the Superior Court granted a Writ of Mandate,ordering the City to review SCWC's franchise application and make a determination either granting or denying the franchise in a manner.not in conflict or inconsistent with the determination of CPUC granting of a CPCN by August 6; 2003; and The CPUC in granting the CPCN, made the following findings: "6. While the City is "able" to provide water and sewer services to Hearthside's development, being contiguous to Bolsa Chica on three sides, despite offers of very substantial benefits involving millions of dollars from Developers to do so, the City repeatedly has demonstrated that it is not "ready and willing" to do so, except possibly upon its terms which include annexation. 9. Following years of unfruitful efforts to obtain water and sewer services from the .City, except upon the City's terms, which in view of the City's past hostility the Developer with reason believes could jeopardize its entitlement and with virtual certainty spur further lengthy delay legal challenges, Hearthside contracted with SCWC for the latter to incorporate the Mesa development project into SCWC's West Orange County District; construct a 7.5-mile, 18 inch interconnecting water_transmission pipeline to the Mesa project, and provide sewer services to the Mesa project. 13. City service, if presently available, would be an environmentally superior alternative to SCWC service. 15. There is a present need for water and sewer services to the Developer's Mesa project and SCWC is "ready, willing, and able" to provide the services requested; and The CPUC's order granting a CPCN states as follows: "A Certificate of Public Convenience and Necessity is granted to Southern California Water Company (SCWC) to effect a non-contiguous extension of its West Orange County District to include the Bolsa Chica Mesa Planned Community on the Bolsa Chica being developed by Hearthside Homes, Inc. (Hearthside); to provide public utility water distribution and wastewater collection services within the Bolsa Chica Mesa Planned Community; and to construct a 6.75-mile water transmission pipeline to interconnect the SCWC West Orange County System with the planned on- site water distribution system at the Bolsa Chica Mesa Planned Community," 2 GARESOLUIN?003\scm-c franchise.doc The CPUC granted the CPCN as an alternative to City water service. By granting this alternative, despite City service being environmentally preferable, there is no reason to conclude that. the CPUC contemplated that SCWC would apply to the City for further discretionary approvals, such as a pipeline franchise. To the contrary, the.CPUC was well aware SCWC could condemn a pipeline easement instead of obtaining a franchise because water corporations are specifically authorized to employ eminent domain pursuant to Public Utilities Code § 620. Further, the CPUC was aware of the provision in the SCWC/Hearthside agreement authorizing use of eminent domain; and The Council has carefully reviewed the CPCN the CPUC granted and found nothing within it inconsistent with a City decision to deny SCWC's franchise application; and In November 2002, California voters passed Proposition 50, which provided funds for acquisition of the Bolsa Chica Mesa for park and habitat preservation. (Water Code § 79500, et seq.) Water Code § 79572 (b) specifically authorized the Wildlife Conservation Board to use a portion of the $250,000,000 in unreserved funds for the acquisition, protection and restoration of coastal wetlands, uplands and watersheds to give priority to the acquisition of not less than 100 acres consisting of upland mesa areas, including wetlands therein, adjacent to the state ecological reserve in the Bolsa Chica wetlands in Orange County; and Pursuant to Water Code § 79573 (b), all real property acquired pursuant to.Proposition 50 shall be acquired from"willing sellers; and Pursuant to this statutory authority, on March 26, 2003, the Wildlife Conservation Board contracted with James Donahue for an appraisal of Hearthside's Bolsa Chica Mesa property. Hearthside Homes provided input to the selection of the appraiser; and If the Bolsa Chica Mesa is acquired, there would no longer be any need for the water pipeline; and Consistent with Proposition 50, the City Council finds that acquisition of the Bolsa Chica Mesa is in the best interest of the community. The City further finds that granting a franchise at this time may cause the appraised value of the Mesa to increase making it less likely that the State will acquire it; and Because there is no approved development for the Bolsa Chica Mesa,there is no reason for the City to issue a franchise at this time; and Because there is a reasonable probability that the State will acquire the Bolsa Chica Mesa, there is no reason for the City to issue a franchise at this time; and 3 GARESOLUTIM2003'•scwc franchise.dac NOW, THEREFORE, it is hereby resolved by the City Council of the City of Huntington Beach that: 1. The franchise application by SCWC is denied. 2. The Recitals set forth above are adopted as findings of fact. PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a regular meeting thereof held on the 4th day of August 2003. &*� ;gzA400t-o Mayor ATTEST: APPROVED AS TO FORM: 4w" I City Clerk City Attorneylfl 3 REVIEWED AND APPR VED City Administrator 4 GARES0LUTN\2003\Scwc franchiseAm Res. No. 2003-57 STATE OF CALIFORNIA COUNTY.OF ORANGE ) ss: CITY OF HUNTINGTON. BEACH ). I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of the City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do hereby certify that the whole number of members of the City Council of the City of Huntington Beach is seven; that the foregoing resolution was passed and adopted by the affirmative vote of at least a majority of all the members of said City Council at an regular meeting thereof held on the 4tn day of August, 2003 by the following vote: AYES: Sullivan, Coerper, Boardman, Cook, Houchen, Hardy NOES: Green ABSENT: None ABSTAIN: None City Clerk and ex-officio C erk of the City Council of the City of Huntington Beach, California ATTACHMENT NO . 2 JUL-28-2003 MON 11 :38 AM FAX N0, F. 02 r GRAY DAVIS,Governor STATE OF CALIFORNIA-THE RESOURCES AGENCY DEPARTMENT OF FISH AND GAME WILDLIFE CONSERVATION BOARD B ta,C 13"Street,Suite 103 Sacramento, allfomia 95814-7t3737 Slult of Cnlifarai+ www,dfg.ca.gov 1YItiGleCOnurvatiooltoard Fax(916)323-0280 July 28, 2003 MEMBERS MlefWOl Crwlrrron Prey; BY FACSIMILE (714) 374-1590 Proe,daM Fo and GemeCommieeron AND U.S. MAIL Ste+e Peace 1) Il r Depam=fFinance Scott Field, Assistant City Attorney Rotten C.Hight Director City of Huntington Beach D808rrntenl of Flo and aarne P.O. Box 190 JOINT LECOMMITT COMMITTEE 2000 Main Street ADVISORY EE - $e1eo„ Huntington Beach, California 92648 Slblb KAhl Michel J.Machae Byronr3har Dear Mr. Field: Aaaemay MQMMrs Request for Public Records P°ftBa'D HenneMBeth Jackson Appraisal of Bolsa Chica Mesa, Orange County, California Fran Ar by Please find enclosed true copies of the public records which you requested "wnp" Eneneva droetpr regarding the State's pending appraisal of land in Orange County known as WYdife CereervaUon Board Bolsa Chica Mesa. Copies of the following records in the files of the Wildlife Conservation Board are enclosed: Contract for Hiring Fee Real Estate Appraisers, No. WC-2099RN (with Contractor's Employer Identification Number redacted); Letter from Howard D. Coleman of Nossaman, Gunther, Knox & Elliott, LLP dated January 29, 2003; Letter from Howard D. Coleman of Nossaman, Gunther, Knox & Elliott, LLP dated December 17, 2002 (with handwritten notes by Randy Nelson, Senior Land Agent, Wildlife Conservation Board). If you have any questions, please contact Randy Nelson at(916) 323-8980 or me at (916) 445-0137. Sincerely, I Wright Executive Director Enclosures JUL-29-2003 11:42 96% P.02 JUL-28-2003 MON 11 :39 AM FAX NO. P. 03 GRAY DAVIS.Governor STATE OF CALIFORNIA-THE RESOURCES AGENCY DEPARTMENT OF FISH AND GAME WILDLIFE CONSERVATION BOARD � re 1Sa.a,,suite 103 Saaeno,California 95814-7117B (916)4454Wa Suit "r cilirornia Fax(916) 1%kwe Caps IX11ion Baud MEMOM MAR 2 6 2003 NO"Pbea.Chmnim - FmwwCiW"A James R. Donahue, Director SI&A Poem MOM Integra Realty Resources Daaif0—Q1ArIarm 29811 Santa Margarita Parkway, Suite 300 ��" Santa Margarita, California 92688-3612 Dwwvmm o1 Flaf ano Game JOINTIEGISMTW Dear Mr. Donahue: ADVISORY COMMrrnM 3alw�s ,&Wft MON Bolsa Chica Mesa WWI aw Orange County AWW"M&MIM Contract Number WC-2099RN pay a" Nwr"W.amimlom Fra"P""i°" Enclosed is your fully executed contract for appraisal of the above subject project. In billing for amounts under this contract, please provide us your ve1o11a CmInam am Baud invoice in triplicate and make reference to contract number WC-2099RN. Also enclosed is a preliminary title report. Parcel B of the description is land owned by the State of California and is not part of the proposed acquisition. The parcel owned by the Ocean View School District (APN 110-016-05) is not covered by the enclosed report. We anticipate a new report(s) covering the parcels to be acquired, which we will forward to you as soon we receive it. If you have any questions regarding this contract, please contact Randall Nelson, Senior land Agent, at (916) 323-8980. Sincerely, /81 AL WRIGHT Al Wright Executive Director Enclosures cc: DFG Fiscal &Administrative Services Branch/ Claims Unit (2 originals of contract) Roxanne Woodward, Budget Officer WCB (letter only) WCB file copy (1 original of contract) JUL-29-2003 11:42 96% P.03 JUL-28-2003 MON 11 :39 AM FAX NO, F. 04 PROJECT IDENTIFICATION STATE OF CALIFORNIA 00 1 CHECK APPROPRIATE BO Bolsa Cihlca(Mesa RESD-WA(REV.111W CONTRACTOR Orange County STATE AQENCY CONTRACT FOR HIRING OEPAR ENT OF GENERAL SERVICES Contract Number WC-2099RN FEE REAL ESTATE APPRAISERS CONTROLLER This agreement is made and entered into this 5th day of March,2003, by and between the State of Ca6fomia,acting through its Executive Director,Wildlife Cons e sinafter called State, and Integra Realty Resources, hereinafter called Contractor, Employer Identification Numbe or Employee Identification Number< Witnesseth: That the parties do hereby agree as follows 1. Contractor, for the consideration hereinafter expressed, agrees to provide State with three copies of an appraisal report estimating the value of a Conservation Easement Covering those certain real properties in Orange County described as Assessor Parcels 110-016-002, 110-016-003, 110-016-004, 110-016-005, 110-016-006, 110-016-014, 110-016-015, 1.10-016-016, 110-016-024, 110-016431, 110-016-03Z 110-017-0O6, 110-017-054&110-017-055. 2. The three copies of the completed report shall be delivered to State of California,Wildlife Conservation Board, 1807131,Street, Suite 103, Sacramento, CA 95814,within seventy-five(75)days of receipt of approved contract The date of delivery of the report may not be extended without written authorization of the Executive Director,Wildlife Conservation Board, and will not be extended beyond the termination date of this contract 3. Contractor is to be paid the sum of$12,500.00 for the completed report,which sum includes the cost of all expenses of any kind or nature incurred by Contractor hereunder. Contractor shall cease work upon State's request,whereupon payment shall be made, prorated on the basis of work completed. 4. Upon delivery of the appraisal report, payment shall be made pursuant to an invoice submitted.to the Wildlife Conservation Board In triplicate bearing reference to WC-2099RN. State normally takes up to 21 days to process an invoice. 5. In no event shall the term of this contract extend beyond June 30,2003. The provisions on the reverse side hereof and the attached four pages of Standard Clauses for Consulting Service Agreements constitute parts of this agreement. In Witness Whereof,this Agreement is deemed to have been executed in quadruplicate by and on behalf of the parties hereto the day and year first above written. STATE OF CAIIFORNIA AC R(IF OTHER THAN AN INDIVIDUAL. • wh A CORPORATIDN.PAR'TNERBMP.ETC.) Into ra Root Resource NI14E OF STATE AGENCY Department of Fish Game By Wildlife Conservation Board X tzrT� James R. Donahue x NescToo— ADDRESS AI Wright Executive Director �� 29811.Santa Margarita Parkway, Ste 300 180713m Street, Suite 103; Sacramento 95814 Santa Malgar'ita. CA 92888-3812 Department of Genera/Services APPROPRIATION Use Only TO BE Capital Outlay F.Y. 2002-03 CHARGED water Security, Clean Drinking Water, Coastal&Beach Protection Act AGAINST LIKE MM ALLOTMENT Chapter 618, Statutes of 2002, 3840-801-6031 0°e' EQ. 02-1 000-81 1-76 01 0 Section 79572 a 2 b AMOUNT OF 711,16 ESTWTE $12,500 00 s EBTTIAATE TO ALL01te6NT EXPENDITURE LEDGER ADJUIRTMENT INCREASING ENCUMBRANCES ADAM17MEN►DECREASING ENCUMBRANCES I Hereby Cemry upon my own personal Krameege that the unencumbered balenoo of the dapuranenOM budget prwlslon tar the period stated above Is earroct.(after T.E.A No. ar B.R.No. 1. SIONATURIE OF ACCOUNTING CHIMER 'Te JUL-28-2003 11:42 96% P.04 JUL-28-2003 MON 11 :40 AM FAX NO, P. 05 Project: Bolsa Chica Mesa San Diego County Contractor: Integra Realty Resources Contract It WC-2099RN Appraisal Specifications All reports must contain the following: 1. Title page with sufficient identification of appraisal project. 2. Letter of transmittal summarizing important assumptions and conclusions, value estimate, date of value, date of report, etc. 3. Table of contents. 4. Assumptions and Limiting Conditions. 5. Description of the scope of work, including the extent of data collection and limitations, if any, in obtaining relevant data. 6. Definition of Market Value, as defined in the 2001 edition of the Uniform Standards of Professional Appraisal Practice (USPAP). "Most probable price......" 7. Photographs of significant physical features, including the interior of residential units. 8. Copies of Assessor's plat maps with the subject parcels marked and an assemblage of all contiguous Assessors parcels that depicts the ownership. 9. The legal description of subject property. 10. For large, remote, or inaccessible parcels, provide aerial photographs or topographical maps depicting the subject boundaries. 11. Sale history of subject property. 12. Discussion of any current Agreement of Sale, option, or listing of subject, if any are known to exist. This issue requires increased diligence since state agencies often utilize non-profit organizations to acquire parcels using Option Agreements. However, due to confidentiality clauses, the terms of the Option are often not disclosed to the state. 13. Regional, area, and neighborhood analyses. 14. Market conditions and trends including identification of the relevant market, a discussion of supply and demand within the relevant market area (or other areas of competition), and a discussion of the relevant market factors.impacting demand for site acquisition and leasing within the relevant market area. 15. Discussion of subject land/site characteristics (size, topography, current use, zoning and land use issues, development entitlements, General Plan designations, utilities, offsite improvements, access, easements and restrictions, flood and earthquake information, toxic hazards, taxes and assessments, etc.). 16. Description of subject improvements, including square footage, room counts for bedrooms and baths, physical age, type of construction, quality of construction, landscaping, etc. 17. Subject leasing and operating cost history. 18. Opinion of highest and best use for the subject property, based on an in depth analysis supporting the concluded use. Such support typically requires a discussion of the four criteria or tests utilized to determine the highest and best use of a property. If alternative feasible uses exist, explain and support market, development, cash flow, and risk factors leading to an ultimate highest and best use. Page 1 of 2 JUL-29-2003 11:43 9E% P.05 JUL-28-2003 MON 11 :40 AM FAX NO, P. 06 19. All approaches to market value applicable in the subject market Explain and support the exclusion of any usual approaches to value. 20. Map(s) showing all comparable properties in relation to subject property. 21. Photographs and plat maps of comparable properties. 22. In depth discussion of comparable properties, and direct comparisons to subject property. 23. Comparable data sheets. For sales, include information on grantor/grantee, sale/recordation dates, listed or asking price as of date of sale, financing, conditions of sale, buyer motivation, sufficient location information (street address, post mile, and/or distance from local landmarks such as bridges, road intersections, structures, etc.), land/site characteristics, improvements, source of any allocation of sale price between land and improvement, and confirming source. For leases, include significant information such as lessor/lessee, lease date and term, type of lease, rent and escalation, expenses, size of space leased, tenant improvement allowance, concessions, use restrictions, options, and confirming source. 24. If applicable, discussion of construction cost methodology, data source used, costs included and excluded, depreciation methodology, a discussion of accrued depreciation from all causes, and remaining economic life. 25. If applicable, copies of construction cost data including, section and pages of cost manual (date of estimate or date of publication of cost manual must be provided if not indicated on page), copies of cost estimate if provided from another source, and supporting calculations including worksheets or spreadsheets. 26. In part-take situations, a discussion of severance damage(or lack of it). 27. Effect of title exceptions on fair market value. 28. Implied dedication statement. 29. Reconciliation and final value estimate. Explain and support conclusions reached. 30. Discussion of any departures taken in the development of the appraisal. 31. Signed Certification. 32. The property to be appraised consists of approximately 239 acres. The appraiser shall include a statement of factual matters and opinions relied upon in connection with the discussion of market conditions and analysis of highest and best use. 33. The appraiser will provide a separate estimate of value for each of the two ownerships comprising the subject property. 34. If, as a result of his investigations, the appraiser concludes that the subject property, in whole of in part, is or will be "entitled", the appraiser will provide support for this conclusion, including documentation of the persons and permitting agencies (local and state)contacted. Page 2 of 2 JUL-28-2003 11:43 96% P.06 JUL-28-2003 MON 11 :40 AM FAX N0, P. 07 CS1of4 State of California The Resources Agency DEPARTMENT OF FISH AND GAME WILDLIFE CONSERVATION BOARD Agreement No.WC-2099RN STANDARD CLAUSES CONSULTING SERVICE AGREEMENTS Commencement of Work This contract is of no force and effect until signed by both parties and approved by the Department of Fish and Game and/or the Department of General Services as pursuant to PCC§§ 10335,10360 and 10295. Any work initiated prior to the approval date is done at the Contractor's own risk Absolutely no expenses incurred prior to the effective date of this agreement will be approved for payment. Availability of Funds Work to be performed under this agreement is subject to availability of funds through the State's normal budget process. Contractor Name Change Contractor shall provide a written notice to the State at least thirty(30)days prior to any changes to the Contractor's current legal name. Documents and Written Reports Any document or written report prepared as a requirement of this agreement shall contain,in a separate section preceding the main body of the document,a disclosure statement indicating that such was prepared through agreement with the Department of Fish and Game and shall further contain the agreement number and dollar amount of all agreements and subcontracts relating to the preparation of such document or report. Inspection The State,through any authorized representatives,has the right at all reasonable times to inspect or otherwise evaluate the work performed or being performed hereunder including subcontract supported activities and the premises in which it is being performed. If any inspection or evaluation is made by the State of the premises of the Contractor or a subcontractor,the Contractor shall provide and shall require his subcontractors to provide all reasonable facilities and assistance for the safety and convenience of the State representatives in the performance of their duties. All inspections and evaluations shall be performed in such a mariner as will not unduly delay the work Nondiscrimination Clause-Excluding Contracts with Federal Entities During the performance of this agreement,Contractor and its subcontractors shall not unlawfully discriminate, harass or allow harassment,against any employee or applicant for employment because of sex,race,color,ancestry, religious creed,national origin,physical disability(including HIV and AIDS),medical condition(oancer),age, marital status,denial of family and,medical care leave and denial of pregnancy disability leave. Contractors and subcontractors shall insure that the evah don and treatment of their employees and applicants for employment are free from such discrimination and harassment. Contractor and subcontractor shall comply with the provisions of the Fair Employment and Housing Act and the applicable regulations promulgated thereunder. The applicable regulations of the Fair Employment and Housing Commission implementing Government Code Section 12990(a-f), set forth in Chapter 5 of Division 4 of Title 2 of the California Code of Regulations are incorporated into this agreement by reference and made a part hereof as is set forth in full. Contractor and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. Contractor shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under the agreement. Americans With Disabilities Act By signing this agreement,Contractor assures the state that it complies with the Americans with Disabilities Act (ADA)of 1990,(42 U.S.C. 12101 et seq.),which prohibits discrimination on the basis of disability,as well as all applicable regulations and guidelines issued prusuam to the ADA. U 1/99 JUL-29-2003 11:44 P.07 JUL-28-2003 MON 11 :41 AM FAX NO, P. 08 CS 2 of 4 Agreement No. WC-2099RN Recycling Certification Contractor shall certify in writing under penalty of perjury that the minimum,if not exact,percentage of the materials,goods,supplies ordered,or products used in the performance of this contract meets or exceeds the minimum percentage of recycled material as defined in PCC§§ 12161 and 12200. The Contractor may certify that the product contains zero recycled content.(PCC§ 10233) Drug-Free Workplace Requirements By signing this agreement,the Cona tar hereby certifies under penalty of perjury under the State laws that the Contractor will comply with the requirements of the Drug-Free Workplace Act of 1990 and will provide a drug free workplace by taking the following actions- 1. Publish a Statement notifying employees that unlawful manufacture,distribution,dispensation,possession or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations, 2. Establish a Drug-Free Awareness Program to inform employees about: a. The dangers of drug abuse in the workplace; b. The person's or organization's policy of maintaining a drug-free workplace; c. Any available counseling,rehabilitation and employee assistance programs'and, d. Penalties that may be imposed upon employees for drug abuse violations. 3. Provide that every employee who works on the proposed agreement: a. Will receive a copy.of the company's drug-free policy statement;and, b. Will agree to abide by the terms of the company's statement as a condition of employment on the agreement Failure to comply with these requirements may result in suspension of payments under the agreement or termination of the agreement, or both,and the Contractor may be ineligible for award of any future State agreements if the Department determines that any of the following has occurred:(1)the Contractor has made false certification,or(2) violated the certification by failing to carry out the requirements as noted above. (GC§8350 et seq.) National Labor Relations Board Clause By signing this agreement,Contractor declares under penalty of perjury that no more than one final,unappealable finding of contempt of court by a Federal Court has been issued against the Contractor within the immediately preceding two(2)year period because of Contractor's failure to comply with an order of a Federal Court which orders Contractor to comply with an order of the National Labor Relations Board (PCC§ 10296) Contract Dispute Clause The State's Contract Manager has initial jurisdiction over each controversy arising under or in connection with the interpretation,performance,or payment under this contract. The Contractor will diligently pursue with the State's Contract Manager mutually agreeable settlement of any such controversy. In the event a dispute cannot be resolved by mutual agreement,the State's Contract Manager shall promptly issue a written decision in the matter which shall be mailed or otherwise furnished to the Contractor and which shall inform the Contractor of his right to appeal the decision as provided herein. The Contractor shall have fifteen(15)calendar days from receipt of the decision to submit a written protest of the decision to the Deputy Director,Administration,Department of Fish and Game. The decision of the State's Contract Manager shall be final and conclusive unless it is appealed by the Contractor within the specified period. Pending final decision of dispute hereunder,the Contractor shall proceed with the performance of this contract,unless otherwise directed by the State. Workers'Compensation Clause Contractor agrees to the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers'compensation,or to undertake self-insurance in accordance with such provisions,and Contractor agrees to comply with such provisions before commencing the performance of the work under this agroement. 01/99 JUL-28-2003 11:44 P.08 JUL-28-2003 MON 11 :41 AM FAX NO, P. 09 CS 3 of 4 Agreement No. WC-2099RN Travel and Per Diem Contractor agrees that all travel and per diem paid its employees under this contract shall be at rates not to exceed those amounts paid to the Studs represented employees under collective bargaining agreements currently in effect. No travel outside the State of California shall be reimbursed unless prior written authorization is obtained from the State. (CCI,Title 2, § 599.615 et seq.) Use of Subcontractors If the contractor desires to accomplish all or part of the services through the use of one or more subcontractors,then the following conditions trust be met. 1)the contractor shall submit any subcontracts to the Slate for prior approval; 2)the contract between the primary Contractor and the subcontractor must be in writing;3)the subcontract must include specific language which establishes the rights of the auditors of the State to examine the records of the subcontractor relative to the services and materials provided under the contract;and 4)upon termination of any subcontract,the State shall be notified immediately in writing. Further,any subcontract in excess of$10,000 entered into as a result of this agreement shall contain all applicable provisions stipulated in this agreement. Audit Clause Contractor agrees that the awarding department,the Department of General Services,the Bureau of State Audits,or their designated representative shall have the right to review and to copy any records pertaining to the performance of this agreement Contractor agrees to maintain such records for possible audit for a minimum of three(3)years from the final payment made by the State,unless a longer period of records retention is stipulated elsewhere in this agreement. Contractor agrees to allow the auditor(s)access to such records during normal business hours and to allow interviews of any employees who might reasonably have information related to such records. Further, Contractor agrees to include a similar right of the State to audit records and interview of staff in any subcontract related to performance of this agreement(GC§9546.7,PCC§ 10115 et seq.,CCR Title 2, § 1896.60 et seq.) Conflict of Interest-Current and Former State Employees Current State Employees No officer or employee shall engage in any employment,activity,or enterprise from which the office or employee receives compensation or has a financial interest and which is sponsored or funded by any State agency,unless the employment,activity,or enterprise is required as a condition of regular State employment No officer or employee shall contract on his or her own behalf as an independent contractor with any State agency to provide goods or services. (PCC § 10410) Former State Employees For the two-year period from the date he or she left State employment,no former State officer or employee may enter into an agreement in which he or she engaged in airy of the negotiations,transactions,planning,arrangements, or any part of the decision-making process relevant to the agreement while employed in any capacity by any State agency. For the twelve-month period from the date he or she left State employment,no formes State Officer or employee may enter into an agreement with any State agency if he or she was employed by that State agency in a policy- malang position in the same general subject area as the proposed contract within the twelve-month period prior to his or her leaving State service. (PCC§10411) Priority Hiring Considerations If this agreement is in excess of$200,000,the Contractor agrees to give priority consideration in filling vacancies in positions funded by the agreement to qualified recipients of aid ender Welfare and Institutions Code Section 11200. (PCC§10353) Contractor's Duties,Obligations,and Rights The Contractor is hereby apprised that California Public Contract Code sections 10355 through 10392 are applicable relative to the Contractor's duties,obligations,and rights in performing the agreement. 0 V99 JUL-28-2003 11:45 96X P.09 JUL-28-2003 MON 11 :42 AM FAX N0, P. 10 CS 4 of 4 Agreement No. WC-2099RN Progren Reports or Meetings Contractor shall submit progress reports or attend meetings with State personnel not more often than monthly to allow the State to determine if the Contractor is on the right track,whether the project is on schedule,provide communication to interim findings,and afford occasions for airing difficulties or special problems encountered so that remedies can be developed quickly. At the conclusion of this agreement,Contractor shall hold a final meeting with the State during which Contractor shall present his findings,conclusions,and recommendations.(PCC§ 10371) Contractor Evaluation In accordance with provisions of the State Administrative Manual, Contractor's performance under this agreement will be evaluated. The evaluation will be prepared within shay(60)days of completion of the agreement. The State will prepare the evaluation on a Contract/Contractor Evaluation form,STD 4. In general,the evaluation will include,but not be limited to: 1)adequacy of the service or product;2)whether the service or product was provided or completed within the time limitations;3)reason for time or cost overruns;4)whether the product is being utilized by the agency and/or agency's general impression as to the competency of the individual and/or individuals under agreement;and 5)other information as may be required by the Department of General Services. A copy of the completed Contractor Evaluation form will be sent to the Legal Office,Department of General Services. If Contractor did not satisfactorily perform the work or service,a copy of the negative evaluation form will be submitted to the Contractor and the Department of General Services,Legal Division,within fifteen(IS)days of the completion of the evaluation The Contractor will have thirty(30)days to prepare and send statements defending its performance under the agreement The evaluation of the Contractor shall not be a public record.(PCC§§ 1.0369, 10370) Amendment Clause This agreement may be amended in writing,and not otherwise,as mutually agreed upon by the parties hereto. The amendment shall be subject to the approval of the Department.of General Services,unless otherwise exempted. Termination Clause The State shall have the right to terminate this agreement at its sole discretion at any time upon giving thirty(30) days written notice to the Contractor. In case of early termination,a final payment will be made to the Contractor upon receipt of a report covering costs incurred up to notice of termination,based on the portion of work completed Air and Water Pollution Violation Under the State laws,the Contractor shall not be: 1)in violation of any order or resolution not subject to review promulgated by the State Air Resources Board or an air pollution control district;2)subject to cease and desist order not subject to review issued pursuant to Section 13301 of the Water Code for violation of waste discharge requirements or discharge prohibitions;or 3)finally determined to be in violation of provisions of federal law relating to air or water pollution. Child Support Compliance Act For any contract in excess of S 100,000,the Contractor aclmowledges in accordance with,that (a)the Contractor recognizes the importance of child and Family support obligations and shall fully comply with all applicable state and federal laws relating to child and family support enforcement,including,but not limited to,disclosure of information and compliance with earnings assignment orders,as provided in Chapter 8(commencing with Section 5200)of Part S of Division 9 of the Family Code;and(b)the Contractor,to the best of its knowledge is frilly complying with the earnings assignment orders of all employees and is providing the names of all new employees to the New Hire Registry maintained by the California Employment Development Department. Ulm JUL-29-2003 11:45 96i P.10 JUL-28-2003 MON 11 :42 AM FAX NO, P. 11 Project: Bolsa Chica Mesa Orange County Contractor. Integra Realty Resources Contract#: WC-2099RN "INSTRUCTIONS TO THE APPRAISER" GUIDELINES FOR FEE APPRAISERS REGARDING IMPLIED DEDICATION RIGHTS Please consider, as a separate section of your appraisal report, the use of the property by the public for recreational rights, if any. Current statutes provide that monies for State acquisitions may not be expended until a thorough investigation is made of the existence of prior public use. If such public use is found,then it must be reflected in the value of the property. Following is a summary of the steps that should be taken by all appraisers to comply with this law: 1) Inspect the property and observe physical characteristics of the site, improvements, hazards and nuisances, access, and any immediate evidence of public use. 2) Conduct interviews to help determine if, in fact, uses have been made which would create public ownership rights. Among others, interviews should be made with: a. The owner,to determine the history of any public use. b. Previous owner or owners for the same purpose if possible. C. Tenants, neighbors and people with an interest in the property. d. Public officials in the area, such as members of the Sheriffs Office, Park Rangers Headquarters, lifeguards, etc. Other sources of information which might prove to be useful if initial investigation reveals potential encumbrance would include: a. Officials of conservation groups or potential user groups, such as dune buggy clubs, skin diving clubs,etc. b. Long time residents in the area who may have information, or who volunteer information. 3) If possible and if necessary, aerial photographs of the property at previous times during its history should be secured. 4) If it appears that there is substantial evidence that such public use has occurred,the appraiser should document his contacts and data provided by these contacts, either in the report itself or in a separate submission. 5) Correlation and conclusion of value must specifically address itself to the facts uncovered and their effect on market value. JUL-29-2003 11:46 96% P.11 JUL-28-2003 MON 11 :43 AM FAX NO, P. 12 LAW OFFICES NOSSAMAN, GTJTHNER, KNOX & ELLIOTT, LLP WALT04 L NOSSAMAN TNIRYY•FIRST FLOOR JOHN T. KNOX (1000.106.) 443 SOUTH FIGUER04 STREET WARRQN G. E61.;OTT Of COUNSEL WILLIAM E. CUTNNER. JR. LOS ANGELES, CALIFORNIA 90071.1602 ()2}2.1009) TELFPNONE (213) 61.-.71300 FACSIMILE 12131 612.7601 P.&N FrANFt.-;ce) SUITE SIITE 70.TE 370.O,2- THIRTY.FOURTr1 FLOOR 5 50 CALIPOHNIA STREET HOWARD D. COLEMAN Gal 73'•STREET N.W. SAN FRANCISCO. CA 04111.470/ DIRECT DIAL NUMBER WASMINOTON•0-C. 20005 (113) 309.0000 (20.)733.7272 (2131 612-7021 EMAIL hcolomen@nossamOn.COm S�RAMP NrO SUI)T1E 1600 (1 SUITE 1000 I0101 VON KARMAN AVCNUE January 29, 2003 - Old L STREET IRVINE. CA 92G+2.0177 SACRAMENTO, CA O5i1a.7705 (040) 833.7000 (916) 442.0008 REFER TO FILE NUMBER 270877 - 0002 VIA FACSIMILE Mr. John Donnelly California Department of Fish and Game Suite 103 1807 13th Street Sacramento, CA 95814-7117 Re: Mesa Appraisal Instructions Dear John: The purpose of this letter is to provide you with my comments on the draft appraisal 'instructions: A. Bolsa Chica Mesa Orange County Proposed Appraisers and Appraisal Instructions 1. There are two San Diego appraisers listed out of the three appraisers. I have no information as to the San Diego gentlemen to distinguish them as coastal experts or Orange County experts. We have concern that the appraisers may not be familiar with the unique Orange County market. We request that you submit the request for proposal to qualified Orange County appraisers. 2. The last paragraph reading "The appraiser shall determine a single value . should be deleted in its entirety. It should be replaced with the following: "The property to be appraised consists of approximately 210 acres as shown on the attached map. The appraiser shall include a statement of factual matters and opinions relied upon in connection with the discussion of market conditions and analysis of highest and best use." 261774_I.DOC :..r.::.:........ JUL-28-2003 11:46 96% P. 12 JUL-28-2003 MON 11 :43 AM FAX NO, P. 13 NOSSAMAN, GUTHNER,KNOX & ELLIOTT, LLP Mr. John Donnelly January 29,2003 Page 2 B. Appraisal Specifications 1. With respect to paragraphs 7 and 16, the property does not contain any structures and certainly no residential structures 2. With.respect to paragraphs 11 and 12, I question the applicability of these provisions since the property has been owned for decades and has not been subject to any sale agreement. However, we have no objection to leaving in paragraphs 7, 11, 12 and 16 as written. If you have any questions, please call me.. VEN, s, kleman o GUTHNM KNOX & ELLIOTT, LLP HDGmif cc: Raymond Pacini Lucy Dunn Robert Hight'Esq. Al Wright 261714 1.00C JUL-29-2003 11:46 96% P.13 JUL-28-2003 MON 11 :43 AM FAX NO, P. 14 ;ti,EC-17-2Oe2 18:09 NOSSAMAN GLRNER KNOX 213 612 7801 P.01 wworrKza NOSSAMAN,GUTHNER,KNOX& ELLIOTT,LLP e "8 S. FIGUEROA STREET,31ST FLOOR (,Y LOS ANGELES,CALIFORNIA 90071-1602 (� Y TELEPHONE(213)612.7800 I FACSIMILE(213)612-7601 Date: 12/17/02 Time: 5:56 PM Pages(including cover page): 3 To: Mr.Al Wright Finn: California Department of Fish and Game Fax: (916)323-0280 Main No.: (916)445-8448 File No: 270877-0001 From: Howard D.Coleman e-mail: hcoleman@now memcom Comments.- ORIGINAL WILL: BE SENT BY MAIL BE SENT BY FEDEX/OVEMIGHT COURIER BE SENT BY MESSENGER X NOT BE SENT Y YOU DO NOT RECEI irE THE NUMBER OFPAGES 1NDICATED ABOVE, PLEASE CALL Glenn Cascon AT (213)612,7800 A7TENUON. this nwevsage 0 intended only for the ute erthe individr al ar enrtry ro whim tr is addremd and nw canton ovtur aims thu is privileged,eot{lldt w1A and&etnw fi m d:elame under applicable law,f jy"wo no the im drd►w0plen4 you am Mrby not(ftd that any use.dlrsemb wian,dietributfan,or copying of this eon mmicarton is etrictly prohiblad Ify w have received thin carnMunieadon in error,pleam now j&us immediaisly by relophont.and rtmm Ab orlgwwwal messup to as at the above ad&ess via the U.S Portal Service, n ankyor. JUL-28-2003 11:47 96% P.14 JUL-28-2003 MON 11 :44 AM FAX NO, F. 15 'Y)EC-17=2002 18;09 NOSSAMAN GUTNER KNOX 213 612 7801 P.02 LAW OPPICES NOSSAMAN, GUTHNER, ]KNOX & ELLIOTT, LLP max WA6rtQ L. N0t0A MAN TMIRTT•010ST RLOOR MA R RR N k%.I 07T 11010.111A) AAl SOUTH RIGUCR OE OA DTR�ST U ►�1,C. 6OUNiaL WILLIAM E. OUTNNOR.JR. LOB ANOQLea.CALIFORNIA 0001.160.2 11177•'M1) TELEONOHC (2T1)I12.7800 ►AOalwllt (]la)0134001 eAN rRAMMAC9 INAtHIMOTON.Q.C. THIRTY.rDURTN/LOOR Lu1Tt a70.0 1/OALI'ORNIA/TRaRY NOWARD D. COLDMAN a01 1!••OTR¢GT M.W, SAN:1.401i00,CA 24111.4707 MAS"INOTON,D.C.2000/ DIRECT DIAL NUMYIR I�1 L)710.0001 1712) L.7272 (213)012-7821 EMAIL na010R1angASAo011Vn,00M aA cA�TO •UIT�1 1400 December �,. �1 /�(� SUITa loos 11161 VON tARMAM AVEMIIE Decierol7e 1/,2002 919 L OTRIET IRVING.CA 07012.0177 6AO111%fA9NTQ.CA 90I1#•170* (0t1)177.7I00 /0161 440-4210 wareR To rILC NUMIaR 270877 .0001 VIA FACSIMYLE Mr.Al Wright Executive.Director California Department of lash and Game,Suite 103 1807 13th Street Sacramento,CA 95814 Re: . §nQhtwater Annroval Dear Al: The following are three appraisers who are known to have residential developmental land experience: 1. James R.Donahue,III,MAI 2. Robert M.Backer,MAI Director/Principal 2190 Carmel Valley Road Integra Realty Resources—Orange County Del Mar,CA 92014 29811 Santa Margarita Parkway,Suite 300 wv�755-8383 Rancho Santa Margarita,CA 92688-3612 8S8 (949)7(0 7200,Ext.226 2 " !ov,. S,IiAlry Fsy x (g S q ,e'q.x(9 4 y) 70 s 7 z 0► 3• William V.Shrewsbury,MAI Sr. Vice President and y) David W.Riach.MAI (71 First American Tax Valuation 1 First American Way Santa Ana,CA 92707 f/FX i•7isJ} yby - �98 S 25i911_).DOC JUL-28-2003 11:47 96% P-15 JUL-28-2003 MON 11 :44 AM FAX N0, P. 16 DEC�17-2002 18:09 NOSSAMAN GUTNER KNOX 213 612 7801 P.03 NOSSAMAN,GUTHNER,KNOX&ELLIOTT, LLP Mr. Al Wright December 17,2002 Page 2 Vjuy you 0 C sa nl of NOSSAMAN, GUTHNEP, KNOX&ELLIOTT,LLP Nt7C/gm 25891! [.DOC TOTAL P.03 JUL-28-2003 11:47 96% P. 16 RCA ROUTING SHEET INITIATING DEPARTMENT: City Attorne SUBJECT: Adoption of Resolution No. A Resolution of the City Council of the City of Huntington Beach Denying the Water Pipeline Franchise Application of Southern California Water Company COUNCIL MEETING DATE: August 4, 2003 RCA :ATTACHMENTS STATUS; Ordinance (w/exhibits & legislative draft if applicable) Not Applicable Resolution (w/exhibits & legislative draft if applicable) Attached Tract Map, Location Map and/or other Exhibits Not Applicable Contract/Agreement (w/exhibits if applicable) (Signed in full by the City Attorne Not Applicable Subleases, Third Party Agreements, etc. (Approved as to form by City Attorney) Not Applicable Certificates of Insurance (Approved by the City Attorney) Not Applicable Financial Impact Statement Unbud et, over $5,000 Not Applicable Bonds If applicable) Not Applicable Staff Report If applicable) Not Applicable Commission, Board or Committee Report If applicable) Not Applicable Findings/Conditions for Approval and/or Denial Not Applicable .... EXPLANATIONFOR�MISSING ATTACHMENTS RE-VIEWED RET.URNEC f .F.O,RWARDED Administrative Staff Assistant City Administrator Initial City Administrator Initial City Clerk EXPLANATION fOR. RETURN OF ITEM SpaceOnly) RCA Author: SFF 7 „ ..:_ 1 `g, i REQUEST FOR LATE SUBMITTAL y: (To accompanv RCA's submitted after DeadlinAll Department: City Attorney Subject Southern California Water Company Pipeline Franchise 111p, Council Meeting Date: 8/4/03 Date of This Request: 7/28/03 IM NO REASON (Why is this RCA being submitted late?): City Council direction was received in Closed Session on July 21, 2003, subsequent to the agenda deadline. ; h N f4 EXPLANATION (Why is this RCA necessary to this agenda?): The Court Order requires the :'. y . ti Cit 's response no later than August 6, 2003. , .. i b, T CONSEQUENCES How shall delay of this RCA adversely impact the City?): A delay would �u- result in a violation of the Court Order and interfere with Cit 's ability to successfully litigate this case. °d1 33 5Y Signature: Approved "erne D` partment Heac Ray Silve City Administrator Document1 07/14/94 T. CITY OF "IUNTINGTON SEACM, CA SCWC Franchise Requ��t -b r 4 • SCWC submitted request to the City for a franchise . Southem Califomia Water Company's on February 1,2002 Request for Franchise • Franchise would allow SCWC to construct pipeline to serve a proposed development,known as Brightwater Clay Martin,Director of Administrative Services Amy Bodek,Real Estate Services Manager November 6,2002 2 Brightwater Project Background SCWC furnishes public utility water service to in Propet `" various cities SCWC is subject to the jurisdiction of the California 1 4 Public Utilities Commission(CPUC).CPUC granted SCWC a"Certificate of Public Convenience and tv m" E Necessity"and certified the Final Supplemental EIR x 3 for the water pipeline on October 5,2000 ( �} '3' - - _ • SCWC would construct a 6.7 mile pipeline from IW`�a•�T "� a• Cypress to the Brightwater project,of which 2.7 miles would be within the City limits i a Background, cont Other SCWC Negotiations " I Cypress/Seal Beach:SCWC already provides water service;only needs encroachment permits • Westminster:in the process of negotiating a Franchise • County of Orange:requires an encroachment permit also negotiating an easement • CalTrans:requires an encroachment permit i r • U.S.Army Cores of Engineers:negotiating an wc �•�� �� easement Option 1: Potential Options for Consideration Negotiate a Franchise • Direct staff to negotiate a franchise; Annual fee could be based on different formulas: or Per linear foot based on pipe width %of gross revenues earned • Notify SCWC that staff will not negotiate a franchise; One-time fees: or - Construction fee - Base granting fee • Notify SCWC that the City Council will defer action at Ability to negotiate mitigation measures to this time compensate for damage imposed during construction: Enhanced street paving � e Option 2: Option 3: Decline Issuance of Franchise Defer Action • No obligation for City to grant a franchise—SCWC • Defer action until future development has an altemative remedy requirements of Boise Chica are more • SCWC has power of eminent domain certain,pending any one of the following: Prop.50 in November • SCWC could condemn a portion of existing right-of- - . California Coastal Commission decision way for its own use on 378-unit project Resolution of judicial challenge for the • Level of compensation would be hard to measure 1,235-unit project • Defense costs(legal,appraisal,professional staff) could range from$50,000 to$250,000 o io 2 t Study Session The City Attorney and the Administrative Services Departments will provide a report regarding the franchise application for Southern California Water to construct and operate a water pipeline in Bolsa Chica Street, in order to provide water service to the Bolsa Chica Mesa. z o a N � O C-) - u � D l:i i Y L.C^h CITY OF HUN i INGTON BEACH, CA 1001 OCT 2 I P 2: 4 Purpose of Study Session • To discuss Southern California Water Study Session on Company's(SCWC)recent request for a Southern Califomia Water Company's Franchise to provide water service a Request for Franchise proposed development project on the Bolsa Chica mesa. Clay Martin,Director of Administrative Services Amy Bodek,Real Estate Services Manager October 21,2002 2 SCWC Franchise Request Brightwater Project • SCWC submitted request to the City fora ' !'f Franchise on February 1,2002 ^ 5 4�'.iM •r.Y F • Franchise would allow SCWC to construct 1�.. x pipeline to serve a proposed development, ti p known as Brightwater "; LB • Brightwater would consist of 378 residential 4 units on a 65-acre portion of the Bolsa Chica's Upper Mesa < F h 1 4 V 'n Lot N m m w' (0, )^0 YL 1 w . Background Background, Cont. • SCWC is subject to the jurisdiction of the California w i Public Utilities Commission(CPUC) • SCWC furnishes public utility water service to various cities • SCWC would construct a 6.7 mile pipeline from t Cypress to the Brightwater project • 2.7 miles of pipeline would be within the City of Huntington Beach s a Background, Cont. Status of Development Project • CPUC granted SCWC a'Certificate of Public • OC Board of Supervisors sustained appeal of the OC Convenience and Necessity"for SCWC to Planning Commission's project approval provide water and sewer service to Brightwater • Developer must submit request for a Coastal Development Permit from California Coastal • CPUC also certified the Final Supplemental Commission(CCC) EIR for the water pipeline on October 5,2000 • In a separate action,Developer has sued CCC for its • SCWC would require a Franchise from previous decision on the County's LCP,which would have permitted development on 214 acres on the Westminster,Cypress,Seal Beach and Boise Chica mesa—appeal is still pending Huntington Beach e 2 Option 1: Potential Options for Consideration Negotiate a Franchise • Direct staff to negotiate a Franchise; • Utility franchise is the grant of special or privileges to use and occupy the public right- 0 Notify SCWC that staff will not negotiate of-way a Franchise; • Charter cities not obligated.to comply with or either Broughton Act or 1937 Franchise Act • Notify SCWC that the City Council will defer action at this time • City Charter addresses franchises,though not specifically for water utilities e ,o Option 1: Option 1: Negotiate a Franchise Negotiate a Franchise • Annual franchise fee could be based on • Ability to place conditions on different formulas: I construction: - Cost per linear foot based on pipe width Dictate width of construction trenches - %of gross revenues earned Set requirement for slurry/paving streets • One-time fees: Control traffic disruptions Construction fee Base granting fee • A combination of fees could yield several hundred to several thousands of dollars annually „ ,s 3 Option 2: Option 2: Decline Issuance of Franchise Decline Issuance of Franchise • No obligation for City to grant a Franchise • SCWC.has power of eminent domain • Courts could only order issuance of • SCWC could condemn a portion of existing Franchise if SCWC had no alternative remedy right-of-way for its own use • Level of compensation would be hard to measure • Defense costs(legal,appraisal,professional staff)could range from$50,000 to$250,000 13 141 Option 3: Defer Action • Defer action until future development requirements of Bolsa Chica are more certain,pending any one of the following: Outcome of Prop.50 in November California Coastal Commission decision on 378-unit project Resolution of judicial challenge for the 1,235-unit project ,e 4 Council/Agency Meeting Held:/LAED. //- b -oL Deferred/Continued to: , pproved ❑ Co di ionally A pr ved ❑ Denied City Clerk's Signature Council Meeting Date: November 6, 2002 Department ID Number: AS 02-39 ,C= CITY OF HUNTINGTON BEACH o REQUEST FOR COUNCIL ACTION NJ SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS 0 .. z SUBMITTED BY: RAY SILVER, City Administrator61d C PREPARED BY: CLAY MARTIN, Director of Administrative Services ROBERT F. BEARDSLEY, Director of Public Work%�� GAIL HUTTON, City Attorney (6-4-0a-- SUBJECT: APPLICATION OF SOUTHERN CALIFORNIA WATER COMPANY FOR PIPELINE FRANCHISE IN ORDER TO PROVIDE WATER SERVICE TO BOLSA CHICA DEVELOPMENT Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: Whether to authorize staff to negotiate a pipeline franchise with Southern California Water Company (SCWC). There is a closed session regarding the negotiable terms and conditions on this November 6, 2002 City Council agenda. The City Council will determine whether or not to discuss these terms and conditions in open session or in closed session. Funding Source: Not applicable. Recommended Action: That the City Council provide direction regarding SCWC's franchise application. Petenbai- ptfons-incude: 1. t staff to negotiate a franchise agreement, s a�,-u5, 2. Notify that the City Council has directed staff not to negotiate a franchise. In this circumstance, WC may file suit to compel the City to issue a franchise, or may initiate eminent domain p ings, or; 3. Notify SCWC that the Council will to action. Alternative Action(s): Set forth above. Analysis: I. Background: On February 1, 2002, Southern California Water Company (SCWC) requested a franchise from the City of Huntington Beach pursuant to the 1937 Franchise Act. The franchise would allow SCWC to construct a pipeline across the City of Huntington Beach SoCalWater11.06.02 -- 10/29/2002 8:22 AM • � I REQUEST FOR COUNCIL ACTION MEETING DATE: November 6, 2002 DEPARTMENT ID NUMBER: AS 02-39 to serve a proposed residential development project on a portion of the Bolsa Chica, known as Brightwater. SCWC is subject to the jurisdiction of the California Public Utilities Commission (CPUC) and furnishes public utility water service to various cities throughout the State. SCWC has two customer service areas and four water systems within SCWC's Orange County District. Brightwater intends to connect its water distribution facilities to SCWC's West Orange County System in the City of Cypress via a 6.7-mile pipeline. Approximately 2.7 miles of the pipeline would lie under Bolsa Chica Street within the City of Huntington Beach. (Attachment 1, depiction of pipeline.) SCWC has determined they have sufficient water to supply the Developer's requirements for the project. The CPUC granted a Certificate of Public Convenience and Necessity for SCWC to provide water and sewer service to Brightwater. (Attachment 2, CPUC decision.) In its October 5, 2000 decision granting the Certificate, the CPUC found the City had refused to provide water service to the development, and consequently authorized SCWC to provide service. In addition, the CPUC certified the Final Supplemental Environmental Impact Report for the water pipeline. The City did not appeal the CPUC's decision. To date, staff has not responded to SCWC's franchise application. The City Attorney's office received a letter, dated August 13, 2002, from O'Melveny & Myers indicating that they had been authorized by SCWC to file a writ of mandate seeking to compel the City to grant a franchise. (Attachment 3, O'Melveny & Myers letter.) II. Current Status of Project: At the time that the CPUC approved SCWC's pipeline, Hearthside homes was seeking County approval for a 1,235 unit project. (Attachment 4, Site Map.) Although the County later approved the Bolsa Chica Local Coastal Program, the Coastal Commission modified it. Hearthside's judicial challenge to the Coastal Commission decision on this larger project is currently pending. While its legal challenge is pending, Hearthside also has proposed a smaller, 378 unit project intended to be consistent with the Coastal Commission's directions. (Attachment 5, Site Map.) The Orange County Board of Supervisors recently sustained an appeal of the County Planning Commission's approval of this smaller development. Coastal Commission consideration of this scaled-down project is pending. III. Franchise Application: Pursuant to its CPUC Certificate, SCWC has applied for a franchise to use the City streets for a pipeline to serve the Hearthside development. The City Council is requested to provide direction to staff in order to respond to SCWC's application. Some of the available options are discussed below. 1. Negotiate a franchise with SCWC The franchise SCWC seeks is not a general authorization for the City to "regulate" a private utility; only the CPUC may exercise that power. (Cal. Const. Art. 12, § 5, 6.) Rather, a utility WDocuments and Settings%odeka\My Documents\RCA Letters\SoCalWater11.06.02.doc -2- 10/29/2002 8:22 AM REQUEST FOR COUNCIL ACTION MEETING DATE: November 6, 2002 DEPARTMENT ID NUMBER: AS 02-39 franchise is the grant of special privileges by a City to a public utility to use and occupy the public rights-of-way owned by a City for a limited utility purpose. General law cities may issue electric and gas franchises under either the Broughton Act enacted in 1905 (Cal. Pub. Util. Code §§ 6001-6017) or the Franchise Act of 1937 (Cal. Pub. Util. Code §§ 6201-6302). The 1937 Act also authorizes other franchises, such as water franchises. The 1937 Act establishes the franchise fee payable to the City as the greater of 2% of the gross annual receipts arising from the use, operation or possession of the franchise, or 1% of the gross annual receipts derived from the sale of the utility services within the City.' (Attachment 6). Although SCWC has applied for a franchise under the 1937 Act, the City does not follow the 1937 Act. While general law cities are limited to issuing franchises in accordance with the Public Utilities Code, charter cities have independent authority to grant franchises. California Public Utilities Code § 6205 provides that the 1937 Act "does not apply to any municipality having a freeholders' charter . . . and having in such charter provisions for the issuance of franchises by the municipality." Only if a charter does not address the grant of franchises must the City follow the procedures set forth in either the Broughton Act or the Franchise Act of 1937. (See City of San Diego v. Southern Cal. Tel. Corp. (1954) 42 Cal.2d 110, 117, 266 P.2d 14.) In fact, the Huntington Beach Charter addresses franchises in Section 615, stating that: "The City Council shall by ordinance regulate the granting of franchises for the City." (The City pipeline franchise ordinance presently only addresses oil and gas, but not water franchises, so a new enabling ordinance should be drafted if SCWC were to be issued franchises. See Attachment 7 for the Charter and Municipal Code sections related to franchises.) It is by way of the franchise that the City sets the annual fee the public utility must pay to the city as consideration for the privilege of using the public rights-of-way. (See Hanford Gas & Power Co. v. City of Hanford (1912) 163 Cal. 108, 124 P. 727.) Since the City does not have to comply with the 1937 Act, the City may negotiate alternative fee formulas for the franchise: cost per linear foot of pipeline based on width of pipe, % of gross revenues earned, etc. A combination of these fees could yield anywhere from several hundred to several thousand dollars annually from a combination of franchise fees and one-time fees. While seemingly minimal, the revenue generated under a negotiated franchise is more than the City could expect under an eminent domain scenario. The City would have virtually the same ability, under either a franchise or an encroachment permit, to adequately enforce traffic control measures through the construction zone. Likewise, the City would assert the repair provisions of its street work ordinance under either alternative. However, only the franchise alternative would allow more possibilities to negotiate various, relevant mitigation measures (e.g. enhanced street paving) to compensate the City for the inconvenience and damage imposed by the construction process. Further discussion of such measures would be 1 While the franchise fee analysis assumes a 1% of gross revenues fee, because the development is outside the City, this formula may not apply.- D:\Documents and Settings\kuhnkee\Local Settings\Temporary Internet Files\0LK6\SoCalWater11.06.02.doc -3- 10/29/2002 11:39 AM REQUEST FOR COUNCIL ACTION MEETING DATE: November 6, 2002 DEPARTMENT ID NUMBER: AS 02-39 appropriately reserved for a time following the decision on whether to pursue the franchise alternative. On the other hand, in the City Attorney's opinion, there is no obligation for the City to grant a franchise. It must be noted that SCWC's attorneys claim that the City is obligated to issue a franchise, citing the case of Southern California Gas Company v. City of Vernon (1995) 41 Cal.App.4th 209, 48 Cal.Rptr.2d 661. However, in that case, the Gas Company already possessed a franchise, and the issue was the decision of the City of Vernon to deny an encroachment permit to build a pipeline. The Court of Appeal held that Southern California Gas was entitled to issuance of the encroachment permit because the conditions of construction were already dictated by the CPUC and issuance of the excavation permit was a ministerial matter. By contrast, issuance of a franchise is not like an encroachment permit that must be issued so long as the conditions of construction are satisfied. Rather, a franchise is similar to a lease of public property. Consequently, just as no one can compel an owner to sell or lease his property, a court could not order the City to grant a "franchise" because the franchise terms are discretionary. For example, the franchise fee could be calculated on a number of different bases. Finally, the Court could only order issuance of a franchise if SCWC demonstrated it had no "alternative remedy." In fact, SCWC may condemn a pipeline easement. Water corporations, operating under a Certificate of Public Convenience and Necessity, are specifically authorized to employ eminent domain. (Public Utilities Code § 618.) Moreover, in a similar situation where the City of Compton tried to compel Shell Oil to negotiate a franchise, the Court held that Shell had the option to condemn the right of way because it was operatin a public utility. (Shell California Pipeline Company v. City of Compton (1995) 35 Cal.AppAt 1116, 41 Cal.Rptr.2d 753.) 2. SCWC condemns right-of-way necessary for its pipelines through the City If SCWC were to institute eminent domain proceedings, the critical issue would be compensation. The measure of compensation would be the difference between the value of the City's street easement before and after imposition of an additional easement in favor of SCWC. Since the City streets are already dedicated to public use and already have pipelines and other underground infrastructure, SCWC would argue that an additional water pipeline easement would have little or no impact on the value of the City's easement. For example, in the case of City of Gilroy v. Filice, 221 Cal.App.2d 259, 34 Cal.Rptr. 368 (1963), a sewer pipeline easement was condemned beneath an existing road easement. The Court explained that where a party is attempting to impose an easement on land already subject to an easement, the owner of the fee is entitled to compensation represented by the difference in the value of the land before and after the imposition of the second easement. If no substantial difference in value is shown, the compensation or damage is "nominal." D:\Documents and Settings\kuhnkee\Local Settings\Temporary Internet Files\0LK6\SoCalWater11.06.02.doc -4- 10/29/2002 11:39 AM REQUEST FOR COUNCIL ACTION MEETING DATE: November 6, 2002 DEPARTMENT ID NUMBER: AS 02-39 The cost to the City in defending its rights in an eminent domain proceeding would be directly related to the level of defense undertaken by the City. Costs for professional and legal staff time and appraisals could range from $50,000 to upwards of $250,000, again, depending on the level of defense mounted by the City. For example, an eminent domain proceeding would require particular expertise in appraising the value of a street easement and in determining a fair and equitable method of valuing the easement after imposition of another easement. 3. Deferrinq Action Another option available to the City is to defer action until the future development requirements of Bolsa Chica are more certain. For example, if Proposition 50 passes, the State may purchase some or all of the Hearthside property (this RCA was written prior to the November 5, 2002 elections). In addition, the intensity of development is uncertain because still pending are: (i) the Coastal Commission's decision on the 378 unit Bolsa Chica development; and (ii) resolution of the judicial challenge to the Coastal Commission's decision on the 1,235-unit project. IV. SCWC Negotiations with Other Entities As stated earlier, the Developer intends to connect its water distribution facilities to SCWC's West Orange County System in the City of Cypress via a 6.7-mile pipeline. Approximately 2.7 miles of the pipeline would lie under Bolsa Chica Street within the City of Huntington Beach. The remainder of the pipeline would cross through various jurisdictions, including the cities of Cypress,-Westminster and Seal Beach, as well as through the Los Alamitos Armed Forces Reserve Center, along an Orange County Flood Control District easement and under the 1-405/SR-22 freeway crossing via a CalTrans right-of-way. SCWC currently is a water provider to the cities of Cypress and Seal Beach. It is therefore not necessary for SCWC to negotiate a franchise with them. The city of Westminster is negotiating a franchise; unlike Huntington Beach, they are a general law city and therefore have less flexibility in their ability to negotiate an alternative fee structure. The city of Westminster hopes to complete negotiations and enter into a franchise with SCWC by January 2003. In addition to these municipalities, SCWC is currently negotiating with the U.S. Army Corps of Engineers for a easement to cross the Los Alamitos Armed Forces Reserve Center, and is also negotiating with the County of Orange for an easement to cross through and along OCFCD right-of-way. Neither of these entities will require a franchise; they will process SCWC's request through other contractual means. Environmental Status: Not applicable. D:\Documents and Settings\kuhnkee\Local Settings\Temporary Internet Files\0LK6\SoCa►Water11.06.02.doc -5- 10/29/2002 11:39 AM REQUEST FOR COUNCIL ACTION MEETING DATE: November 6, 2002 DEPARTMENT ID NUMBER: AS 02-39 Attachment(s): City Clerk's Page Number No. Description 1 Map of proposed water pipeline 2 CPUC Certificate of Public Convenience and Necessity 3 August 13, 2002 letter from O'Melveny& Myers 4 Site Map, 1,235-unit project 5 Site Map, 378-unit roject 6 Franchise Act of 1937 7 Municipal Code Section 3.44 relating to pipeline franchises RCA Author: Bodek x5445, Field x5662 D:\Documents and Settings\bodekaft Documents\RCA Letters\SoCalWater11.06.02.doc -6- 10/29/2002 8:22 AM ATTACHMENT # 1 BOLSA CHICA WATER LINE AND WASTEWATER PROJECT B. Project Descri tion i i CYPRESS ' STANTON i LOS ALAMITOS 1 Orangewood ! ROSSMOOR ; -- - •- .-•- ; Los Alamitos a Chapman _1 i Armed Forces m GA DEN i - 1 Reserve Center i GROVE I Lampson i — _ — — / 405 Gar eri-Grov Blvd. TM.) TV 22 LD ca SEAL .6EACHTraskto ES MINS ERWestminsterWestminster r° - PROPOSED Sao NBols BOLSA CHICA DOMESTIC WATER tiTRANSMISSION LINE 0° Seal Beach �N Navy Weapons Station cFadde ! HUN INGT N 3 EACH z j Edinge � m m 3 0 uz xt ' w m = Heil i CL gg cc . fl \ Warner Trl Pa.c�frc I Los Patos X'Udean-ap / f Stater ' e 1 6. . 1 � OLSA CHICA PLANgE,D Waterject 4 � COMMUNITY SITE 1 1 Figure B-2 N 0 1 1/2 Proposed Water Transmission Scale in Miles Aspen Line Route IL Environmental Group February 2000 B-4 Final SEIR ATTACHMENT #2 FINAL SUPPLEMENTAL ENVIRONMENTAL IMPACT REPORT FOR THE y� PROPOSED BOLSA CHICA WATER LINE AND WASTEWATER • "°` SERVICE PROJECT The Final Supplemental Environmental Impact Report (SEIR) for Southern California Water Company's (SCWC)application for the Proposed Bolsa Chica Water Transmission Line and Wastewater Service Project was certified by the California Public Utilities Commission during its October 5,2000,public meeting. By a 3-to-2 vote,the Commission also approved SCWC's application for a Certificate of Public Convenience and Necessity(CPCN). The approved CPCN permits the construction and operation of a 6.7-mile underground water transmission line to deliver water to the Bolsa Chica Planned Community site—a proposed residential development located at the southerly terminus of Bolsa Chica Street in unincorporated Orange County(A.98- 11-003).The CPCN also allows SCWC to operate and maintain a wastewater collection system that would be constructed to serve the Bolsa Chica Planned Community(A.98-11-015). In accordance with Section 15095(a)of the Guidelines for Implementation of the California Environmental Quality Act (Title 14 of the California Code of Regulations), enclosed is a copy of the Final SEIR. For additional information,you may call Brad Wetstone of the California Public Utilities Commission at(415) 703-2826. The Final SEIR is also available for review at the following Internet address: http://www.epuc.ca.gov/Environment/info/aspen/bolsachica/bolsa.htm A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. TABLE OF CONTENTS TITLE PAGE OPINION........................................................................................................................... 2 1. Summary...................................................................................................................... 2 2- Statement of Facts....................................................................................................... 2 2.1. The Applicant...................................................................................................... 2 2.2. The Applications ................................................................................................ 3 2.2.1. A.99-11-003............................................................................................... 3 2.2.2. A.99-11-015............................................................................................:.. 3 2.3. The Protests......................................................................................................... 4 3. Background History................................................................................................... 4 4. Rule 6.1 Aspects........................................................................................................ 14 5. Procedural History ................................................................................................... 14 5.1. The February 25, 1999 Prehearing Conference (PHC)................................ 14 5.2. The Resulting Scoping Memo......................................................................... 16 5.3. The April 22, 1999 2nd PHC............................................................................. 17 5.4. The August 23, 1999 EH.................................................................................. 18 5.5. Briefing............................................................................................................... 19 6. The Environmental Review Process ...................................................................... 20 7. Discussion................................................................................................................. 24 7.1. Project Considerations..................................................................................... 24 7.2. Environmental Considerations ...................................................................... 33 7.2.1. Draft SEIR............................................................................................... 33 7.2.1.1. Public Comments and Input ................................................ 33 7.2.2. Final SEIR ............................................................................................... 34 7.2.2.1. Alternatives Screening Process............................................ 34 7.2.2.2. Alternatives Eliminated from Full Consideration ........... 34 7.2.2.3. Alternatives Evaluated in the SEIR 35 ..................................... 7.2.2.4. Environmentally Superior Alternative............................... 35 7.2.3. Environmental Analysis of the Proposed Project............................. 37 7.2.4. Significant Environmental Effects of the Proposed Project............ 38 7.2.4.1. Beneficial Impacts (Class IV)................................................ 38 7.2.4.2. Adverse, But Not Significant Impacts (Class III) .............. 38 7.2.4.3. Significant Impacts That Can be Mitigated To a Level That Is Less Than Significant (Class II Impacts)................ 39 7.2.4.3.1. Noise...................................................................... 39 - i - a A:98-11-003, A.98-11-015 ALJ/JBW/epg :•. . . .•: 7.2.4.3.2. Traffic and Circulation........................................ 39 7.2.4.3.3. Environmental Contamination.......................... 40 7.2.4.3.4. , Geology and.Soils ................................................ 40 7.2.4.3.5. Cultural Resources........................:...................... 41 7.2.4.3.6. Biological Resources............................................ 41 7.2.4.3.7. Public Services and Utilities............................... 41 7.2.4.4. Significant Impacts That Cannot Be Mitigated To Insignificant Levels (Class I Impacts) ................................. 42 7.2.5. Environmental Findings and Statement of Overriding Considerations........................:....................................................:......... 44 7.2.6. Adequacy and Certification of the Final SEIR.................................. 45 7.2.6.1. Adequacy_of the Final SEIR.................................................. 45 7.2.6.2. Certification of the Final EIR................................................ 46 Comments on the Proposed Decision of the ALJ...................................................... 47 Findingsof Fact .............................................................................................................. 50 Conclusionsof Law........................................................................................................ 54 ORDER............................................................................................................................. 55 Appendix A - Final Supplemental Environmental Impact Report Appendix B - General Metered Sewer Tariff - ii- n e ' ALJ/JBW/epg .•. - Mailed 10/11/2000 Decision 00-10-029 October 5, 2000 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA In the Matter of the Application of Southern California Water Company (U 133 W) for a Certificate of Public Convenience and Necessity Application 98-11-003 pursuant to California Public Utilities Code (Filed November 5, 1998) Section 1001 to extend its West Orange County System to the Bolsa Chica Planned Community. In the Matter of the Application of Southern California Water Company (U 133 W) for a Certificate of Public Convenience and Necessity Application 98-11-015 pursuant to California Public Utilities Code (Filed November 10, 1998) Section 1001 to Operate and Maintain a Wastewater System to Provide Service to the Bolsa Chica Planned Community. Patricia K Schmiege, Attorney at Law, of O'Melveny & Myers, LLP, and Susan L. Conway, for Southern California Water Company, applicant. Tames S ueri, Attorney at Law, of Goodin, MacBride, Squeri, Ritchie & Day, and Russell G. Behrens, Attorney at Law, of McCormick, Kidman & Behrens, for Hearthside Homes, Inc., interested party. Ronald A. Van Blarcom and David H. Mann, Attorneys at Law, of Van Blarcom, Liebold, McClendon & Mann, for the City of Huntington Beach, and Donald Horgan, Attorney at Law, of the Law Offices of Dennis P. Riordan, and Alys E. Masek, Attorney at Law, for Bolsa Chica Land Trust, protestants Peter G. Fairchild, Attorney at Law, for the Ratepayer Representation Branch of the Water Division. 69798 - 1 - 1 A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. O P I N I O N 1. Summary, This decision approves Application (A.) 98-11-003 and A.98-11-015 of Southern California Water Company (SCWC) for Certificates of Public C6nvenience and Necessity (CPCN): (1) to extend SCWC's West Orange System from the City of Cypress via a 6.7-mile, 18-inch pipeline to be constructed through intervening cities of Seal Beach, Westminster, and Huntington Beach in public rights of way, and traversing through portions of unincorporated Orange County and rights of way under the jurisdiction of the California Department of Transportation, the Orange County Flood Control District, and the Armed Forces Reserve Center in the City of Los Alamitos, to serve a residential development to be constructed by Hearthside Homes (Developer) in unincorporated territory known as the Bolsa Chica Mesa (Mesa); and (2) to operate, manage, and control a wastewater collection system in the same residential development. The decision also certifies the Final Supplemental Environmental Impact Report for the project. 2. Statement of Facts 2.1. The Applicant SCWC is a California public utility under the jurisdiction of this Commission providing public utility water services to over 240,000 customers in the state through 41 separate systems in ten counties. SCWC obtains its water from (1) the Colorado River and the State Water Project, and (2) local groundwater from the Santa Ana River Groundwater Basin obtained through 27 wells. The SCWC West Orange County System has 36,241 gallons per minute (gpm) of water flow available from all sources to meet maximum day demand. - 2 - A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. At present, this system has an approximate available surplus of 5,979 gpm. The Mesa project's total flow requirement for domestic and fire flow protection is estimated to.be 4,040 gpm. Apart from its public utility water services, SCWC also operates two wastewater treatment plants in California. One is at the Naval Air Facility Station in El Centro and the second is at the City of Calipatria. In those latter two activities, SCWC employs 12 persons. 2.2. The Applications 2.2.1. A.99-11-003 Pursuant to provisions of Public Utilities Code Section 1001, SCWC seeks from the Commission a CPCN authorizing SCWC to extend the service territory of its West Orange County District to include a noncontiguous residential community to be located on the Mesa segment of the Bolsa Chica in an unincorporated area of Orange County; authorization to construct a 6.75-mile water transmission pipeline to interconnect the District to the Mesa community development; authorization to file a new tariff map to reflect this noncontiguous extension of its service territory; authorization to charge such rates and tariffs in the Mesa project as are in effect in SCWC's West Orange County District; and authorization to treat the water facilities as contributed plant not in rate base. 2.2.2. A.99-11-015 Pursuant to provisions of Public Utilities Code Section 1001, SCWC seeks from the Commission a CPCN authorizing SCWC to provide wastewater service to the Mesa community development; authorization to file a tariff map reflecting the provision of wastewater service to the development; and authorization to apply certain rates and tariffs in the development as set forth in the application. - 3- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. 2.3. The Protests Timely protests were filed by the City of Huntington Beach (the City), the Bolsa Chica Land Trust (Land Trust), and the Ratepayer Representation Branch of the Water Division (RRB). 3., Background History In the unincorporated portion of northwestern Orange County there is an approximate 1600-acre area known as the Bolsa Chica. Bolsa Chica is bounded to the north, east, and south by the City of Huntington Beach (the City), and to the southwest by the Pacific Coast Highway and the Pacific Ocean. The Bolsa Chica embraces three general areas: the Bolsa Chica Mesa (the Mesa); the considerable larger area of the Bolsa Chica lowlands (Bolsa Chica wetlands) and the Huntington Mesa. The entire Bolsa Chica lies entirely within the Coastal Zone (as defined by the California Coastal Act), and therefore is subject to the land use planning and regulatory jurisdiction of both Orange County and the California Coastal Commission. Orange County land use regulation is done in accord with the County's General Plan. In 1979, Signal Landmark owned the Bolsa Chica area, and began working through the County jurisdiction for entitlement to develop the area. By early 1986, a land use plan for Bolsa Chica was proposed and certified by the Coastal Commission. It provided for 5,700 residential units and a marina-commercial complex. But local opposition formed, leading in 1988 to formation of a Bolsa Chica Planning Coalition. The Coalition included State, County, and City representatives, the landowner, and a local environmental group, Amigos de Bolsa Chica (Amigos). The purpose in forming the Coalition was to facilitate negotiation of a revised land use plan for the Bolsa Chica. - 4- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. Some conflicts were resolved and a concept plan adopted which substantially reduced residential development. By mid-1990, the City and the County signed a Memorandum of Agreement, with the City to be the lead agency to process a new Local Coastal Plan (LCP) and an Environmental Impact Statement/Environmental Impact Report (EIS/EIR). The City took three years in planning studies and drafting EIS/EIRs for the project.. Despite the wide public input, when the City finally released its draft EIS/EIR, it drew wide criticism. New opposition groups formed. An organization called the Bolsa Chica Land Trust organized to advocate public acquisition of the Bolsa Chica. The City decided its land use plan should be changed, and the Coalition broke-up when the City left the Coalition. In view of the City's changed view on development of the Bolsa Chica, the breakup of the Coalition, and processing delays by the City, the Koll Real Estate Group (KREG), then the project Developer for Signal Landmark,' determined to exercise its right to process its entitlement requests through the County. The County-City Memorandum of Agreement was cancelled, and the County assumed the lead agency role for development of the Bolsa Chica under the California Environmental Quality Act (CEQA). Late in 1993, the County issued a draft EIR following the land use plan for Bolsa Chica that earlier had been devised by the now defunct Coalition. The draft EIR was revised following public comment and recirculated. The draft EIR provided two alternatives: one ' The original Developer for the Bolsa Chica Planned Community, Koll Real Estate Group, has since reorganized. Signal Landmark is the current owner of the property on which development is proposed and Hearthside Homes, Inc. is the Developer. Signal Landmark and Hearthside Homes are both wholly-owned subsidiaries of California Coastal Communities, Inc. - 5- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. provided for 2,500 residential units on the Mesa and 800 units on the lowlands; the second alternative limited residential development to the 2,500 units on the Mesa. The County Planning Commission following public comment approved the first plan as the LCP for Bolsa Mesa. In April 1995, over objections from the City, the County Supervisors approved a development agreement with the Developer. In January 1996, after public hearings, the Coastal Commission approved the County's LCP for Bolsa Chica with suggested modifications. In March 1996, in response to a legal challenge from the Land Trust and other groups to the County's adoption of the Bolsa Chica LCP draft EIR, the Superior Court ordered the County to prepare a revised draft EIR so as to reflect a more stable project description, and then to recirculate the revised draft EIR. In June 1996, the County did this. After this was recirculated, the County Supervisors ratified the suggested Coastal ComiTiission modifications and adopted a Final EIR. The Superior Court in 1996 found that the County had complied with its earlier order by recirculating the draft EIR. The Land Trust group appealed in September 1996, and their appeal was rejected by the Court of Appeals in June 1998. Back in March of 1996, the Land Trust and other community groups also challenged the Coastal Commissions January 1996 approval of the County's LCP for the Bolsa Chica. The Commission approval had included residential development on the wetlands (800 units), the filling of Warner Pond, and relocation of a raptor habitat eucalyptus grove. The Superior Court on August 7, 1997 found against the Commissions approvals as to the wetland development and filling of Warner Pond, but rejected the Land Trust claim that relocation of the eucalyptus grove would result in a significant impact or that there was an - 6- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . inadequate buffer zone. The Coastal Commission modified its LCP accordingly, eliminating wetland residential development and filling of Warner Pond, and again approved the LCP. Various appeals followed, leading to a Court of Appeals decision on April 16, 1999 that, while upholding the Coastal Cpmmissiori s previous approval of the LCP in all practical aspects except as to the preservation and protection of the raptor habitat eucalyptus grove, ordered Superior Court to remand the Bolsa Chica LCP to the Coastal Commission. Superior Court on June 25, 1999 ordered the Coastal Commission to reconsider the LCP in its entirety, and to conduct a full public hearing on any LCP it proposes before again approving the LCP. While these Court decisions have no material impact on the design, construction or operation of the proposed pipeline, the area of the Mesa project may require some.modifications, particularly as it relates to the area near the eucalyptus grove. This could result in minor relocations of water distribution and sewage collection-li-ues in the project itself. The LCP is conterminous with the area of the Bolsa Chica Planned Community. That portion of the Planned Community that the Developer projects for residential purposes is the northerly subarea of Bolsa Chica, approximately 230 acres referred to as the "Mesa." The Mesa consists primarily of grasslands ranging in elevation from 7 to 57 feet mean sea level. The Developer plans approximately 1,235 lots, with the development to be primarily of single family detached homes and a limited number of townhouses. The Mesa, while in the City's sphere of influence, lies entirely in the unincorporated area of the County. In these unincorporated areas of Orange County, the County provides police and fire protection services for any developments, but it does not provide water and sewer services. Typically, - 7- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. water and sewer services are provided either by adjacent cities or by special districts. In the situation present here, the principal alternatives open to the Developer to obtain water and sewer services were either to contract with an adjacent city, or form its own service entity. The adjacent city here was Huntington Beach. To explore the possibility of obtaining water from the City, in June of 1996 the Developer met with the City Administrator. As inducements the range of discussion included the Developer providing certain capital infrastructure improvements to the City's water system as well as per unit contributions based upon the number of proposed units the Developer would build on the Mesa. The City Council was ambivalent about allowing the City's staff to negotiate with the Developer.2 Several members were opposed unless the Developer would agree to further reductions in the density allowed in the Developer's County entitlements, and would agree to apply the City's building standards. However, the Council-finally asked its City Administrator to provide a process '- The City Council meeting of August 5, 1996 reflects that while staff requested authorization to negotiate regarding provision of water and sewer services, the Council vvas split. The Mayor indicated no consideration unless the project density was reduced and the project was built to City standards, and agreed with another councilman that the project should be stopped due to impacts on the city. Finally, 6 to 1, the Council asked the City Administrator to develop a process for discussions and "possible negotiations," considering the financial impacts on the City. From the record in this proceeding, including the minutes of City Council meetings, it was clear that the City Council would prefer to have no development at all on the Bolsa Chica. One or more Council members are members or advisors to the Land Trust, and the pressures on the Council to do all it can to prevent development are enormous, and are applied at every opportunity. - 8- A.98-11-003, A.98-11-015 ALJ/JBW/epg for discussions and possible negotiations with the Developer. The Council wanted the fiscal impacts to the City to be considered in the process. By a 4-3 vote in the April 1997 meeting, the City Council rejected the Developer's 1996 water proposals, but agreed to evaluate any new water proposals if proffered. The Council also voted to continue negotiations on library, police, sewer, and traffic agreements. In the same month (April of 1997), although the City's staff had been precluded from discussing water and sewer services with it, the Developer none- the-less submitted a comprehensive concept proposal regarding City delivery of public services to the Developer's Mesa project. The water component of that proposal (making use of an earlier study by the City) noted the City's need for a reservoir in the vicinity of the Mesa to correct the City's existing pressure problems, and proposed to build and lease a 9-million gallon reservoir site to the City at a dollar a year with the property to pass to the City in ten years. The Developer would contribute $8.75 million of the cost in exchange for the City providing, operating, and maintaining water and sewer facilities to the Mesa development. Other portions of the package deal addressed fiscal benefits relating on fire and emergency medical services, law enforcement and library services. The Developer observed that there had been two years of discussion regarding City provision of services to the Mesa project, and asked for some resolution on the issues. During the summer of 1997, the Developer also explored with the City of Westminster the possibility of that city furnishing water to the Mesa project. A written proposal was submitted whereby the Developer would provide funding to enable Westminster to make capital improvements to that city's water system in exchange for Westminster furnishing water. In October of 1997, in the face of - 9- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .'. .•. strong opposition from the Land Trust, the Westminster City Council voted to reject the Developer's proposal. . Well cognizant of the depth of continuing opposition to any development on the Mesa from local groups such as the Land Trust, Amigos, Surf Rider Foundation, Huntington Beach Tomorrow and others, and seeking to explore all alternatives, the Developer had also entered negotiations with Southern California Water Company. This led to a March 1997 agreement for SCWC to provide water through a transmission pipeline from existing sources in SCWC's West Orange County System, to the project. SCWC would also be responsible for operation and maintenance of the on-site distribution system, and for provision of on-site wastewater services. Meanwhile, following months of meetings, the City's Administrator in October of 1997 informed the Developer that he would not recommend that the City serve water to the Mesa development unless the Developer would agree to annex the Mesa into the City. Annexation, however, presents significant legal, process and timing challenges to the Developer. Hearthside, the present Developer, and its predecessors have been in land use approval processes with more than 25 public agencies, and in land use litigation with local activist organizations, for almost 30 years with regard to Bolsa Chica development. Throughout these processes the City has taken positions on a variety of matters affecting the property that the Developer construes as being in opposition to development of the Mesa, and sympathetic to delay. Despite these obstacles, the Developer had obtained a Development Agreement with the County on April 18, 1995 that is valid for 15 years with respect to its development of the Mesa. As an undeveloped area under the - 10- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . County's jurisdiction, this Development Agreement provides the Developer with certain land-use entitlements.3 Hearthside's concern regarding any annexation was that the Developer's hard won and expensively obtained entitlements would then be jeopardized by protraction of the annexation process on the part of the City, and by the virtual certain attendant litigation that would result, designed to delay and/or limit project implementation and prevent ultimate project build-out.4 Trying to move the project along, the Developer was proceeding with SCWC.5 But when SCWC's engineering contractor approached the City with preliminary plans relating to construction of the interconnecting 18-inch pipeline in the City, the City responded that legally it could not proceed unless SCWC first secured a CPCN from the California Public Utilities Commission (PUC), and that an environmental assessment on the pipeline would be required. 3 The Development Agreement between the County and Hearthside granting development entitlements also commits Hearthside to a long and wide ranging list of public benefits which go beyond those inherent in the development project. Hearthside must pay residential permit fees up to approximately $21/2 million to the County's Mesa Conservation Fund; provide area traffic improvements; pay fees for a Child Care Fund; contribute 49 acres to Wieder Regional Park and up to $1/2 million for a Park ecological interpretative center; provide recreational trails for bicycles and pedestrians; construct, equip, and dedicate a fire station; mitigate fiscal impacts on the County General Fund; pay $100,000 to maintain the County's General Plan; and provide plans for emergency services and flood control. 4 The organization with perhaps the greatest clout with the City, and an active litigant regarding the Bolsa Chica is the Land Trust. With a 4,700 membership, it supports the concept that a nature/wilderness park should be developed on the Mesa with no residential development. 5 The Agreement between the County and the Developer is already five years old and there is still no development started on the Mesa. - 11- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. The City Council, at.its December 15, 1997 meeting, had asked its staff for an updated report on the Bolsa Chica to include water and other services and any EIR requirements for the proposed pipeline. At its January 20, 1998 council meeting, this report update was received, and the City Administrator was then directed to return with a cost-benefit analysis of annexation. He was also to obtain from the Developer a written statement regarding the Developer's receptiveness to annexation.6 The City next hired a small team of outside consultants to work with the. City's departments and staff to prepare a report analyzing the fiscal impacts to the city of annexing the Bolsa Chica unincorporated area. Three scenarios were initially examined, using a four-year horizon (consistent with the Developer's four-year build out plan). The three assumed there would be development on the Mesa segment.of the Bolsa Chica. The scenarios were: (1) annexation prior to development; (2) development without annexation, and (3) annexation after development. A draft report was publicly issued on July 29, 1998. Following public workshops (August 28, 1998, September 24, 1998, and November 30, 1998) revisions were made and a fourth scenario was added (annexation without 6 While the Developer could initiate annexation proceedings on its own, it told the City that it will not do so without a pre-annexation agreement with the City setting forth terms and conditions and clarifying development rights, development standards, and infrastructure requirements. But the Developer will not agree to annexation as long as the City's opposition to the Developer's Mesa project continues. And nothing in state law compels a landowner to annex. - 12- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. development). The report on the fiscal trend that would result from annexation showed that annexation in every case would produce a fiscal benefit to the City.? The 18 years of delay and disputes that had held up the Developer in its plans to develop on Bolsa Chica led the Developer to proceed through SCWC or risk losing its investment. Despite the repeated opportunities that the environmental and public interest groups had had during the numerous public hearings, public workshops, and comment periods to express concerns, and the significant opportunities that the City had had to be involved with the Mesa project and to work with the Developer, the Developer felt that negotiations had come to a standstill. With the City's staff precluded from discussing provision of 7 The results of the Report: 1. Annexation prior to development The fiscal impact to the City under this scenario resulted in a negative cash flow the first year after annexation and positive cash flow annually thereafter. The four-year cumulative surplus to the City totaled $1,412,041. 2. Development without annexation This scenario resulted in a negative fiscal impact to the City during the first three years of project build-out. By the fourth year, however, the City begins to realize a surplus ($167,249). This is principally due to required up-front capital expenditures in the initial years to construct a new fire station. The overall cumulative deficit over the four-year horizon is $2,989,749. 3. Annexation after development is complete This scenario assumes annexation in the fifth year, after build-out of the project is complete. During the four years of project construction, while the area remains unincorporated, a total deficit impact to the City of$2,989,749 has been created. After annexation in year five, an annual surplus to the City begins to reduce this deficit. By year eight, the deficit remains, but is reduced to$2,116,896. 4. Annexation without development This scenario results in a small revenue surplus for all four years with a cumulative surplus of$72,575. The fourth-year annual surplus dwindles to under $6,000, however, principally due to expected reductions in oil extraction tax revenues. - 13- A.98-11-003, A.98-11-015 ALJ/JBW/epg .. .•. .. water and sewer services to the Mesa project, it appeared to the Developer that the City was deliberately delaying any final response. To the Developer there appeared to be no other presently available water and sewer services than those offered through SCWC.. And this ultimate conclusion led to the contract with SCWC and SCWC's application to the Commission. 4. Rule 6.1 Aspects As relevant to proceedings filed on or after January 1, 1998, Rule 6.1 of the Commission's Rules of Practice and Procedure requires that the Commission preliminarily determine the category of the proceeding and whether or not a hearing is indicated. By Resolution ALJ 176-3003 dated November 19, 1998 (A.98-11-003) and Resolution ALJ 176-3004 dated December 3, 1998 (A.98-11-015), the Commission preliminarily categorized these proceedings as being ratesetting and preliminarily determined that a hearing was necessary. 5. Procedural History 5.1. The February 25, 1999 Prehearing Conference (PHC) A duly noticed PHC was held in San Francisco on February 25, 1999 before Assigned Commissioner Henry M. Duque and Administrative Law Judge (ALJ) John B. Weiss. On February 19, 1999 the City had filed a PHC statement wherein it recognized that the Developer's need to resolve the water and sewer issues was time sensitive, but also stated its view that local resolution of annexation issues could resolve the water/sewer issues without the PUC. In support of this view, the PHC statement noted that on January 19, 1999, a Council subcommittee had approved an annexation study (commissioned a year earlier with a first draft issued July 1998), and.that the full City Council would consider the study's - 14- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . .•. recommendations on February 22, 1999 to develop an annexation strategy with negotiation parameters.$ The PHC statement asked for a 60-day continuance of the PHC after which the City would report its progress. The City did not respond at the February 23, 1999 PHC to the Commissioner's PHC notice posing four questions.9 Nonetheless, the ALJ during 8 Although the Council meeting has transpired only a couple days previously, the City did not report that at its February 22, 1999 meeting, two Council members stated their opposition to any annexation agreement and were against any negotiations at all with the Developer. And as the minutes of that meeting revealed, it was a majority that voted to proceed. 9 In the notice for the PHC, the Assigned Commissioner directed the City to respond to a question at the PHC. Although the City's response was dated February 23, 1999, it was filed March 8, 1999 (after the PHC) in form of a "Supplement to City's PHC Statement." These four questions and a summary of the City's responses follow: Question 1. "Does the City presently desire to itself provide water service or sewer service to the Planned Community?" While stating that it considered itself to be the most direct supplier, being the closest in proximity and capable of providing a reliable looped service, the City's response avoided answering the question. It did not state whether or not it wanted to provide service. It stated it could not provide service beyond its boundaries without LAFCO approval and that it had to work within defined legal procedures with the Developer, and that the Developer had not applied to annex. Question 2. "Does the City presently have surplus water or immediate access to water supplies sufficient to meet the stated requirements of the Planned . Community?" Again, the direct question is not answered. Instead, the response stated that if annexed, the City would have to provide water service, and sets forth its two basic sources and states that details of supporting infrastructure are expected to be refined during pre-annexation negotiations. Question 3. "If the City prefers annexation, is it able to immediately proceed with the annexation formalities to annex the Planned Community?" The City Council 5-2, on February 22, 1999 authorized discussions with the Developer on a pre-annexation agreement. But there was no acknowledgement of the existing Footnote continued on next page - 15- A.98-11-003, A.98-11-015 ALJ/JBW/epg . . . . .•. the PHC, with the approval of the Commissioner, stated that if the City was unequivocally willing and able to serve with no further delay, its proposal to serve would be heard as an alternative to SCWC's request for a CPCN in an Evidentiary Hearing (EH) which the ALJ was scheduling. The ALJ noted that the Commission was constrained to render a decision on the SCWC application within 18 months; that the issue before the Commission was not "annexation," but whether SCWC should be authorized to serve, and our proceeding would go forward without delay. Should the parties reach a pre-annexation agreement providing for City service, the Commission proceeding could be aborted at any time by the Applicant. A second PHC was scheduled for April 22, 1999 providing negotiation opportunity, but an EH schedule was also tentatively established. 5.2. The Resulting Scoping Memo Following the February 25 PHC, the Assigned Commissioner issued his Scoping Memo and Luling pursuant to Rule 6.3 of the Commissions Rules of Practice and Procedure. The Memo and Ruling affirmed the ratemaking categorization of the proceedings, designated ALJ Weiss as the principal hearing County-Developer Agreement (the real "sticking point"), rather reference was to provisions of earlier "Bolsa Chica Principles" adopted in 1994 by the Council containing requirements pertaining to lot size, design, height, density, etc. Question 4. "If the City is unwilling or unable to annex at this time, but is now willing and able to provide water and sewer services to the Planned Community, and desires to do so, is the City willing to expeditiously negotiate and execute a binding service contract or contracts for provision of water and/or sewer services to the Planned Community?" The response was that while the City rejected the Developer's 1997 proposal for extra-territorial service, the City has never said it would not contract under any circumstances, although LAFCO would have to approve. The response stated that at present it was moving toward an annexation strategy beneficial to both City and Developer. - 16- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. officer, adopted the timetable schedule discussed in the PHC, and set forth the scope of the proceeding. 5.3. The April 22, 1999 2"d PHC As scheduled, the 2nd PHC was held in San Francisco before Commissioner Duque and ALJ Weiss. Both the City and the Developer reported on their negotiations. Negotiation meetings had been held on March 4, 11, 18, and 25, 1999 and on April 1 and 15, 1999. At the last meeting, the City's staff and the Developer agreed upon a list of"deal points" for a draft pre-annexation agreement. Its staff was to present the Council a proposed draft pre-annexation agreement, but not until June 28, 1999.10 The Developer noted (1) a continuing May 1997 Council Resolution to support public purchase of the Developer's property for open space, and (2) a March 29, 1999 Council majority directive to its staff that as a condition to annexation, the Developer must agree to sell its property for public open space. The Developer concluded that good faith of the city's staff notwithstanding, it saw no reasonable expectation of any pre-annexation agreement. In view of the certain litigation challenges that would attend any agreement, the Developer will not agree to annexation until its development is actually built. Finally, the Developer observed that it was committed to pay $500,000 to SCWC should 10 When the staff returned to the City Council June 28, 1999 with the "deal points" for a mutually acceptable pre-annexation agreement, and recommended approval, the Council rejected the proposal and directed staff to continue negotiations subject to new conditions and modifications of the "deal points." The City wanted to be able to voice its objections on the Mesa project to the Coastal Commission at that Commission s forthcoming LCP hearing and to be free to take any position. - 17- A.98-11-003, A.98-11-015 ALJ/JBW/epg .'. .'. .'. SCWC not be the service provider. The parties did agree to continue negotiations. Minor scheduling adjustments were made and affirmed by the Assigned Commissioner on April 26, 1999 in an Addendum Ruling to this Scoping Memo. 5.4. The August 23, 1999 EH The scheduled EH was held in San Francisco on August 23, 1999 before ALJ Weiss (a City request for a delay having been denied).11 As ordered ii On July 21, 1999, the City requested rescheduling the EH to November 21, 1999, a date after the November 2-5, 1999 period in which the Coastal Commission would perhaps conduct a hearing on the LCP, pursuant to Superior Court's June 25, 1999 order. The City stated that an extension would facilitate negotiations between the City and the Developer on a pre-annexation agreement, noting that a majority of the Council indicated approval of a list of 21 "deal points" arrived at between City's staff and the Developer, but could not support approval until they knew the extent of any Mesa development included in the Coastal Commission approval of an LCP. The Developer strongly opposed delay in the EH, contending that the pending return of the Developer to the Coastal Commission"to remedy defects in the LCP" has no bearing on the PUC's consideration of the SCWC applications; that there is no reasonable expectation that the Coastal Commissions action will change the City's long-standing unwillingness and unreadiness to provide water and sewer services to the Developer's project, and that the City's request is an attempt to inject uncertainty where none exists. SCWC joined the Developer in opposition to any delay in the EH. In his denial of the delay request, the ALJ observed that while the Coastal Commission had scheduled a hearing for during the November 2-5, 1999 period, there could be no assurance as to when it would issue a decision after such hearing (and as of February 2000, no decision has resulted). Furthermore, whether or not the City elects to pursue annexation was not a matter within the purview of the PUC. Should a City-Developer pre-annexation agreement be reached before a PUC decision, the applications can be withdrawn; and should a CPCN be issued, SCWC can still elect not to exercise it and let the CPCN authorization lapse. But as the Assigned Commissioner made clear in his Footnote continued on next page - 18- A.98-11-003, A.98-11-015 ALJ/JBW/epg . . .•. .•. by the Commissioner's Scoping Memo, prepared testimony had been submitted on August 4, 1999 and rebuttal prepared testimony on August 18, 1999. The applicant utility's testimony and evidence was introduced by Patrick R. Scanlon, District Manager of SCWC's Orange County District. The Developer's testimony and evidence was introduced by Lucy Dunn, Executive Vice President of Hearthside Homes. The City's testimony and evidence was introduced by Thomas A. Rulla, Principal Civil Engineer in the City's Public Works Department, Dennis E. MacLain, Water Resources Consultant and the City's Interim Water Operations Manager, and Laurie J. McKinley, Principal Partner, McKinley Nielsen Associates, public policy and governmental affairs consultants. The RRB introduced no witnesses but did provide a staff report and brief and participated in cross-examination. 5.5. Briefing Concurrent-Closing and Reply Briefs were submitted, respectively, on September 8, 1999 and September 22, 1999. The proceeding was submitted for decision on September 22, 1999. 5.6. Oral Argument Pursuant to timely written request, an ALJ Ruling set oral argument before a quorum of the Commission for May 2, 2000. SCWC, Hearthside, the April 26, 1999 addendum to his Scoping Memo, it would be the firm intention of this Commission to conclude the application process by April 2000 (within the 18-month provisions for ratemaking cases) to comply with the Legislative intent expressed in Section 1 of Senate Bill 960, Chapter 856 of 1996 statutes. - 19- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .'. City, and the Land Trust presented oral argument to Commissioners Duque, Bilas, Neeper, and Wood as scheduled. 6. The Environmental Review Process In late 1993, following dissolution of the Coalition, the County released a dzaft EIR for its local coastal program applicable to the Bolsa Chica. This was subsequently revised and ultimately resulted in the "1996 Recirculated Draft Environmental Impact Report for Bolsa Chica Local Coastal Program (County of Orange 1996)." The on-site water distribution and sewer collection systems were subjected to environmental review in that document, and the facilities described in that EIR remain basically the same. However, that EIR contemplated the City as the water supplier, but acknowledged that other alternatives would be pursued if a service agreement could not be.executed with the City. As the present plan is fora water transmission line to connect SCWC's West Orange County System to the Developer's Mesa project, a proposal not contemplated or examined in the previous 1996 EIR, a supplemental environmental review is now required pursuant to the CEQA (Section 21000 et seq. of the California Public Resources Code) and.in accordance with the Guidelines for the Implementation of the CEQA (Section 15000 et seq. of the California Code of Regulations). The Guidelines stipulate that an EIR must be prepared for any project that may have a significant impact on the environment. The transmission line under consideration is a "project" as defined by Section 15180 of the Guidelines. Upon initial review the Commission determined that the proposed project may have a significant adverse impact on the environment and the preparation of an EIR was required. As the public agency with the principal responsibility for authorizing the water transmission pipeline project that may have an adverse environmental - 20- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . .•. impact, the Commission is the Lead Agency under CEQA for the project. Section 15163 of the CEQA Guidelines indicates that a supplement to an EIR is prepared to augment a previously certified EIR when substantial changes under which a project is undertaken necessitate changes to the EIR because new significant environmental effects are involved. A supplement to an EIR need contain only the information necessary to make the previous EIR adequate for the revised project, but has the same notice and review requirements as other EIRs, and may be circulated by itself without recirculating the final previous EIR. The Supplemental EIR here is intended to supplement the 1996 Recirculated Draft Environmental Impact Report for Bolsa Chica Local Coastal Program (County of Orange 1996). It was prepared to evaluate the proposed water transmission pipeline and changes in management of the on-site water and wastewater facilities. It is not intended to re-evaluate any components of the Mesa project previously examined in the 1996 Recirculated Draft Environmental Impact Report for Bolsa CChica Local Coastal Program (Count of Orange 1996). The process of preparing the Final Supplemental Environmental Impact Report (SEIR) included the following steps, which offered numerous opportunities for public involvement. • An Initial Study was prepared in July of 1999 that identified potentially significant environmental impacts that could result from construction and operation of the Proposed Project. Based on the findings of the Initial Study, the Commission determined that an SEIR was required. The SEIR supplements the 1996 Recirculated Draft Environmental Impact Report for the Bolsa Chica Local Coastal Program (SCH# 93-071064) that was certified by the County of Orange. • A Notice of Preparation (NOP) for the SEIR was distributed on July 8, 1999, to cities along the proposed route and the - 21- A.98-11-003, A.98-11-015 ALJ/JBW/epg .. . . .•. alternatives proposed by SCWC, as well as to potentially affected public agencies, organizations known to have an interest in the Proposed Project, and the State Clearinghouse. The Initial Study was attached to the Notice of Preparation. • Notices of public Scoping Meetings were published in four newspapers: The Orange County Register (July 15, 1999); The • Huntington Beach Independent (July 15 and 22, 1999); The Westminster Journal (July 15, 1999); and The Seal Beach News Enterprise (July 15, 1999). In addition to providing notice of the meetings in the NOP, meeting notices were mailed to over 500 owners of property adjacent to the proposed water transmission line route and to potentially interested groups and organizations. • Public Scoping Meetings were held on July 22 and 23, 1999, in Seal Beach and Huntington Beach, respectively. • A project website and an information and comment telephone line were established to provide updated information regarding the Proposed Project and the CPUC environmental review process. In addition, a dedicated e-mail address was established for use by the members of the public to provide information and comments to the CPUC. • On December 6, 1999, copies of the Draft SEIR and Notice of Completion were delivered to Parties to the proceeding, Responsible Agencies, other affected public agencies, interested organizations, and the State Clearinghouse. In addition, a Notice of Completion, with information on where the Draft SEIR was available for review, was mailed to over 350 organizations and individuals. • The Draft SEIR was sent to two public libraries to be made available for public review -- the Huntington Beach Central Library and the Westminster Library. In addition, the Draft SEIR was made available on the project website. - 22- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. • A 45-day comment period was established for public review of the environmental document from December 7, 1999, through January 20, 2000. • A Public Information Meeting was held on January 6, 2000, in Huntington Beach to present to the public information contained in the Draft SEIR. In addition to being announced in the Notice of Completion accompanying the Draft SEIR, notice of this meeting (and the availability of the Draft SEIR) was published in the Huntington Beach Independent (December 9 and 16, 1999), the Seal Beach Nezvs Enterprise (December 8 and 15, 1999), and the Westminster Herald (December 9 and 16, 1999). • On January 21, 2000, a Public Participation Hearing (PPH) was convened in Huntington Beach by the assigned Administrative Law Judge. Notice of the PPH was mailed to over 350 organizations and individuals, including parties to the proceeding, responsible agencies, other affected public agencies; and interested organizations and individuals. Legal notice of the PPH was published in the Orange County Register (January 16, 2000), the Seal Beach Nezvs Enterprise Qanuary 19, 2000), and the Huntington Beach Independent (January 20, 2000). • The Final SEIR was filed with the Commissions Docket Office on February 11, 2000. The Final SEIR includes responses to 19 sets of written comments and 10 speakers who attended the PPH. The Final SEIR must be certified by the lead agency under CEQA before a project may be approved. Certification consists of two steps. First, the agency must conclude that the document has been completed in compliance with CEQA, and second, the agency must have reviewed_and considered the SEIR prior to approving the project. Additionally, the lead agency must find that the Final SEIR reflects its independent judgment (Pub. Res. Code Section 21082.1(c)(3).) - 23- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .'. The Commission is designated as lead agency under CEQA and as such has had the responsibility to prepare the SEIR. 7. Discussion 7.1. Project Considerations With regard to SCWC's proposed extension of its West Orange County Systems service territory to include the noncontiguous territory of the Developer's Mesa project and SCWC's proposed construction of an interconnecting 6.75-mile, 18-inch water transmission pipeline (A.99-11-003), and SCWC's proposed provision of wastewater services to the Mesa project (A.99-11-015), Public Utilities Code Section 1001 provides that before making such an extension or beginning such construction, or providing such services, SCWC must first obtain from the Commission a CPCN. In determining whether or not the Commission will grant a CPCN, it must be reasonably assured that there is a public need for the services or facility; that the applicant possesses the resources, technical competence, and operational experience to provide the service and to construct the facility required; and that granting a CPCN would be in the public interest. That there would be a need for water and sewer services when the Developer's Mesa project is started is obvious. SCWC's evidence shows that it has an adequate and reliable water supply available, sound plans for the design and construction of the interconnecting pipeline, the proven resources, technical competence, and operational experience to manage, operate, and maintain the water and sewer systems proposed for the Developer's Mesa project, and that it . proposes fair and reasonable rates. In addition, SCWC asserts that most importantly, the record in this consolidated proceeding demonstrates that SCWC is the only provider presently "ready, willing and able" to provide the services. - 24- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. Stating that it is the logical and natural service provider for the Mesa project; that the Mesa, while located in the unincorporated part of the County, is also within the City's sphere of influences, the City claims that the Developer is really "shopping around" for municipal type services for its own benefit to the detriment of the public. The City's evidence shows that the City has adequate and reliable water sources as well as the technical competence and operational experience to provide water and sewer services to the Mesa project. Were it to provide the water service, only 0.5 miles of paved roads would be temporarily disrupted, rather than the 7.5 miles if SCWC serves. As the City does not charge for sewer service, its total rate package charge would be about 6/7th of the SCWC's average proposed rates for the combined services.12 But the City since 1996 has taken the position that it would provide these services only in connection with annexation into the City. The City asks that SCWC'S application be denied. The Developer does not deny that the City is both "ready and able" to provide both water and sewer services to its Mesa project. Indeed, earlier it sought to contract with the City for these services, offering considerable financial inducements to improve some deficiencies in the City's water system, but to no avail. Subsequently, the Developer worked aggressively with the City's staff toward development of a mutually acceptable pre-annexation proposal, including $12 to $15 million in public benefits for the City. Staff and the Developer mutually determined upon"deal points," only to have the City Council in June 1999, reject the proposal ostensibly in favor of pursuing 12 See Appendix B for SCNC's sewer rates. - 25- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . .'. additional negotiations. The Council wanted to keep its options open with regard to the Appeal Court ordered remand of the LCP back to the Coastal Commission. In view of the City's long-standing and continued efforts in support of no development on the Mesa or delay, the Developer considers that its hard-won land entitlements obtained from the County (as an unincorporated area entity) would be jeopardized if the Developer opted to annex.13 While the City could not defeat an annexation application, under annexation it would assume the lead role in regulating development and permit issuance. This is a powerful mechanism and ultimately determines whether a project gets built. If not supported by the City, processing can be delayed and approvals be overly conditioned. Accordingly, in the absence of specific and enforceable guarantees from the City, the Developer feels it could never assume the risk of annexation with its realistic possibility that local politics would undermine its existing County land-use approvals, and determine whether the project would ever get _ T 13 As relevant here, a proposal to annex territory into a city may be initiated by the city affected, the county, or by a property owner. The Local Agency Formation Commission (LAFCO) decides whether or not the annexation should follow; however, a protest by 50% of the property owners or 50% of the assessed value holders in the annexation area terminates the annexation. If the city initiates it for environmental purposes it, becomes the lead agency; if the county initiates it, it becomes the lead agency; and if a property owner initiates, LAFCO is the lead agency. If the City here were to initiate annexation, the County-Hearthside Development Agreement would limit the City, unless the City finds that application would be injurious to the health, safety, and welfare of the City's residents. Then the City could exercise its police powers to revise or suspend the Agreement. Hearthside considers that the City exercising its power to police is a powerful mechanism for regulating development, and ultimately determines whether a project gets built. If a project gets opposition, as the record here seems to guarantee, the City could delay processing, condition approvals, or ensure that the matter goes before the voters in the City. - 26- A.98-11-003, A.98-11-015 ALJ/JBW/epg . . . . .•. built. Concluding that while the City is "able" it is neither "ready nor willing" to provide service or facilitate the Mesa project, the Developer has turned to SCWC as the only viable alternative. The Background History set forth herein, and the record adduced in this proceeding, provide the basis for the Commission's conclusion that as the City appears to be politically or otherwise unable to unequivocally agree to be the.provider of services at present, we must look to the SCWC applicant as being the only "ready, willing and able" provider. There has been, as the Developer points out, no testimony from the City Council stating that the City does not oppose the project; no City Council resolution that unequivocally states the City's willingness to serve. As the Developer points out, four of seven Council members are either sympathetic to project opposition or are actual members of the Land Trust whose avowed mission is to stop development at all costs. And one Council Member (Bauer) is listed on the Land Trust stationery as advisor to the Land Trust. . . For many years the Developer has tried to work with the City, first through the Coalition, and thereafter as directly as the City Council would permit, but to no avail. The Council will not accept the County entitlement agreement that would go with a pre-annexation agreement; it wants changes - - less density, more affordable housing, application of City standards, a series of issues. It would not agree not to testify or oppose the Developer's Mesa project before the Coastal Commission re-hearing of the LCP. Annexation would involve the LAFCO with procedural delays and legal appeals that would be virtually certain. And the past delays have cost the Developer and Landowner heavily. - 27- A.98-11-003, A.98-11-015 ALJ/JBW/epg .'. .•. .•. In the City's response to the question posed in the Assigned Commissions Ruling noticing a PHC as to whether the City "desires" to provide service, the City avoided a direct response. It stated it would not provide service outside its boundary without LAFCO approval. But as the records shows, the City is and has been providing service to a number of others on the Bolsa Chica, with no mention of any LAFCO approval (Aera Energy operating over 250 active oil wells and water injection wells, Tohn Thomas operating over 70 active oil wells and water injection wells, Woodman Pole Yard operating a landscaping business and horse stables, and others). But it refuses service to the Developer as exemplified by its abrupt revocation of a temporary use permit (allowing the Developer to tap a City hydrant across the street from the Mesa for use in drilling an exploratory on-site water well) when Land Trust members discovered the use and pressured the.Council to end it. After years and years of addressing the issue, at most the City is only prepared to assert that it has never unequivocally informed the Developer that it would not provide services to the Developer's Mesa project under any circumstances. But such a stance is not a demonstration of the willingness of the City to presently provide the needed services. On the other hand, SCWC is presently "ready, willing and able" to provide the services required as exemplified by its present applications. Turning to consideration of the merits of SCWC's applications, it is the Commissions conclusion from the record in this combined proceeding, that SCWC has shown itself to be well qualified and competent to provide both the proposed water and sewer services to the Mesa project and to design and construct the proposed pipeline. - 28- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .'. The water distribution and sewer collection systems SCWC will manage, operate, and maintain are both relatively simple systems presenting no unusual or difficult challenges to any experienced operator. SCWC currently operates 39 water systems serving over 240,000 customers in ten counties and 75 communities, and has over 70 years experience and adequate experienced staff numbering 475 employees. SCWC also currently operates two wastewater treatment plants and has 12 employees experienced in wastewater operations. In addition, the utility's everyday water operations include operation of facilities that are very similar operationally to wastewater facilities. Further, SCWC intends to hire contractors who specialize in sewer system maintenance to maintain the principal components of the wastewater system. SCWC has extensive experience in meeting the standards of the California Department of Health, and meets.all federal and state requirements for monitoring, reporting, and treatment. SCWC has service personnel 9 miles away, and available 24 hours daily to respond to service emergencies. In its proposed water input area, its West Orange County District, SCWC has over 5,900 gpm excess capacity, far more than needed to supply the total build-out residential and fire protection requirements of the Mesa project. SCWC has extensive experience in the planning, construction, and supervision of construction of water pipelines. In the West Orange County District alone, each year it installs 4 to 5 miles of pipeline. These include 14- and 16-inch lines; some crossing under major freeways, storm drain channels and around underground construction. SCWC's role in construction of this proposed pipeline will be to have SCWC's Engineering and Planning Department review the design, plans, and specifications provided by the Developer's engineering consultant before construction is to be performed pursuant to a bidding - 29- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. procedure. SCWC will provide inspection, and after inspection will own, operate, and maintain the pipeline as a contributed facility. The 6.75-mile underground 18-inch ductile iron pipeline will originate at the SCWC Orange County System in the City of Cypress, and terminate at the 4-million gallon buried concrete reservoir on-site at the Mesa project. The location for the pipeline between these points was determined by the Developer's engineers and approved by SCWC after evaluation of multiple locations based on criteria including impact on traffic, ease of construction, rights-of-way and environmental impacts. The pipeline is divided into three segments which will be constructed concurrently, using open trench construction with typical trenches ranging 3.5 to 15 feet deep, and three feet wide. Open trench construction will approximate 100 feet per day in each of the three segments. Boring and jacking will be employed at three locations, (1) The U.S. Naval Weapons Station rail tracks crossing of Bolsa Chica Street just south of Westminster Boulevard;,(2) the intersection of Bolsa Chica Road and Westminster Boulevard; and (3) the crossing of I-405/SR-22 freeway interchange). Special methods of construction will be employed at two flood control crossings. Again, there is nothing particularly difficult, distinctive, or uncommon about either the proposed pipeline or in its construction. The pipeline will run parallel to, or cross, other public utilities already in most of the right-of-way route. These other utilities include water mains, sewer pipes, power lines, natural gas mains, telephone lines, and petroleum pipelines. While most are between 6 to 12 inches in diameter, others go to over 3 feet with one - 30- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . being 42 inches. The repair, maintenance, and replacement of such utility piping is a common place in any urban setting such as the City.14 Here, about 2/3 of the route selected is on Bolsa Chica Street and Road where the daily traffic volume ranges between 23,000 to 49,000 vehicles. This flow would be disrupted in part by the construction but the disruption would be relatively of short duration, and one common in cities where underground utilities must be maintained or replaced. The major portion of the rest of the route will be in maintenance or service roads or on a golf course. Other routes were considered, but this one was chosen as preferable, it being the most direct route, thus requiring the least construction and disruption. The disruptive effects from water system construction, albeit relatively minimal and of temporary duration, are a factor considered in the granting of a CPCN. The rates SCWC proposes to charge for water to the Mesa project customers are those in effect in the rest of SCWC's West Orange County District, and are those determined to be just and fair in SCWC's last general rate proceeding for the district. SCWC's proposed sewer rates, being based on estimated costs of service for a lh build-out, appear to be fair and reasonable start-up period rates. After a period of operations, these can be reviewed using actual costs in a later rate proceeding. Approximately $12 to $13 million in facilities will be contributed to SCWC by the Developer, and will be excluded from rate base for ratemaking 14 Indeed, were the City to provide service to the Mesa project, it states it would have to replace over 2,000 feet of existing water pipes in Lynn and Bolsa Chica Streets. There also is a stretch of Bolsa Chica Street south of Heil Street recently dug up for an installation. - 31- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . purposes. Staff and the City on brief propose that any approval of the SCWC applications should be conditioned by a requirement that SCWC should not receive compensation for the cost or value of these contributed facilities in the event of a subsequent sale, condemnation, or transfer of the utility systems in the Planned Community. This is not a new proposal. The Commission's general position in the past has been that the matter should be addressed only on a specific case-by-case basis when the issue arises; that the Commission will not prejudge either Superior Court or a future Commission's ability to judge each case on its merits (See New Water Main Extension Rule (1982) 7 CPUC2d 778, where expert witnesses from both the then Hydraulic Branch and the Revenue Requirements Division of the Commission opposed adoption.) In addition, contributed plant may be an element in whether a premium over rate base is found in a just compensation proceeding. Finally, in the July 14, 1997 Committee Report for Senate Bill 1268 (enacted as Public Utilities Code § 2720), the Assembly Committee on Utilities and Commerce proposed that "[t]he author may wish to consider amending the bill to ... limit the application of the selected valuation to that portion of the system for which the Developers paid." That such limiting language was not adopted in the final version of the statute indicates that contributed plant may be considered in determining either fair market value or RCNLD value of the acquired system. Thus the legislative history of Section 2720 makes clear that the Legislative intended to allow a purchaser to include the fair market value of contributed plant in rate base. The Commission is not responsible for local land use decisions. Here the County and the Coastal Commission have a shared jurisdiction and the Developer has been granted development entitlements under the LCP. That this - 32- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . LCP is under review as the result of an Appeals Court decision, and that the result could possibly be a diminished Mesa development,.does not affect this Commission's obligation to act with regard to the application before us. If the project should be smaller, a smaller diameter pipeline may suffice the Developer's needs, but that would not significantly effect the pipeline construction process, essentially the same size trench, etc. would still be required. Nor would it change the Commission's conclusions as to the ability of SCWC to ably and reliably provide the water and sewer services on-site and to construct the water pipeline. Delay would only serve partisan interests. SCWC's proposals to provide water and sewer services to the Mesa project and to construct the pipeline are in the public interest and should be granted. 7.2. Environmental Considerations 7.2.1.' Draft SEIR The first step in the process of preparing a Final SEIR is the preparation of a Draft SEIR. The Draft SEIR in this instance was prepared by an independent environmental consultant, the Aspen Environmental Group, under the supervision of the Energy Division, and was distributed on December 6, 1999, for public review. It includes the analysis of four alternatives (plus the No Project Alternative) to the proponent's Proposed Project and identifies over 30 mitigation measures to avoid or minimize impacts. 7.2.1.1. Public Comments and Input Public comments on the Draft SEIR were solicited through its distribution, as well as through an Informational Meeting held on January 6, 2000, and a PPH conducted on January 21, 2000. The latter two meetings were held in Huntington Beach. Written comments were accepted - 33- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . through January 20, 2000. The Commission received 19 sets of written comments and 10 people commented verbally at the PPH. 7.2.2. Final SEIR The Final SEIR was filed with the Commissions Docket Office on February 11, 2000. The Final SEIR consists of the Draft SEIR, with minor revisions in response to comments and other information received by the Commission, plus the actual comments received on the Draft SEIR along with responses to these comments. 7.2.2.1. Alternatives Screening Process CEQA requires an EIR to evaluate alternatives to a proposed project (Guidelines § 15126(d)). As part of the preparation of the SEIR, a number of alternatives were studied that could meet most of SCWC's project objectives. The alternatives evaluation process focused on finding alternatives that (1) were feasible, (2) would substantially avoid or lessen the Proposed Project's significant environmental effects, and (3) would attain most of SCWC's basic project objectives. The assessment of feasibility was directed toward reverse reason, that is, an attempt was made to identify anything about the alternative that would not be feasible on technical or regulatory grounds. The alternatives analysis addresses two types of alternate projects: (1) alternate .- pipeline routes for the SCWC water transmission line; and (2) possible alternative water providers. 7.2.2.2. Alternatives Eliminated from Full Consideration Five alternatives were evaluated and determined to be either infeasible or not having environmental benefits over the Proposed Project. The eliminated alternatives included a variety of other pipeline routes as - 34- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . well as the installation of new groundwater wells on Bolsa Chica Mesa. The rationale for eliminating each of these alternatives is explained in detail in Section D.1.4 of the Final SEIR. 7.2.2.3. Alternatives Evaluated in the SEIR Four alternatives were described and evaluated in the SIER that were judged to be capable of satisfying SCWC's basic project objectives and having some potential to reduce the impacts of the Proposed Project. Two of these alternatives involved alternate pipeline routes; two involved alternative water providers. In addition to the No Project Alternative, the following alternatives were evaluated in the Final SEIR: (1) Connection to the City of Huntington Beach Water System; (2) Anaheim-Barber City Channel Diagonal (Rancho Road); (3) Springdale Street/Graham Street; and (4) North Seal Beach Wellfields. . 7.2.2.4. Environmentally Superior Alternative The Final SEIR identifies Connection to the City of Huntington Beach Water System as the environmentally superior alternative. This alternative was selected because it would have substantially reduced environmental impacts compared to both the Proposed Project and the other project alternatives, which each involve construction of a significantly longer water transmission line. The environmentally superior alternative would involve construction of an underground pipeline connection to the City's water main in Warner Avenue, approximately one-third of a mile from the proposed reservoir on the Bolsa Chica Planned Community site. With respect to the other project alternatives, the types of environmental impacts associated with these alternatives are largely similar to each other and to the Proposed Project, although the impacts differ slightly in - 35- A.98-11-003, A.98-11-015 ALJ/JBW-/epg .•. .•. .•. magnitude. The basic impacts shared by these alternatives include disruption of local traffic due to construction activities in public streets, air quality and noise impacts, and various other construction-related impacts. As the Proposed Project is more direct and offers the least amount of construction in public street rights-of-way and has relatively fewer sensitive land uses along its route, the Proposed Project is.preferred over the remaining alternatives. Although we have identified connection to the City of Huntington Beach as the environmentally superior alternative, we are rejecting that alternative as infeasible, based on the administrative record and the reasons discussed in Section 7.1. The SEIR, in subsection D.2.1, found the connection to the City of Huntington to be feasible "from a technical and regulatory standpoint," and proceeded to describe and analyze it. This was the prudent approach to take at the time of preparation of the SEIR. As the Commission stated in response to comments on the draft SEIR submitted by O'Melveny & Myers on behalf of SCW�_-, "[T]he scoping memorandum prepared by the CPUC Administrative Law Judge (dated March 16, 1999.) specifically identified the prospect of the City providing water service as an issue to be addressed in the CPCN proceeding." (SEIR, p. J-144.) The issue has now been addressed, and with the significantly more developed administrative record before us, we find that the alternative of connection to the City of Huntington Beach is infeasible. The CEQA Guidelines indicate that an EIR need examine in detail only those alternatives that the lead agency determines "could feasibly attain most of the basic objectives of the project." (CEQA Guideline 15126.6(f).) More specifically, the Guidelines state that"Among the factors that may be taken into account when addressing the feasibility of alternatives are ... economic viability ... and whether the proponent can reasonably acquire, control or - 36- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. otherwise have access to the alternative site ... " (CEQA Guideline 15126.6(f)(1).) And they continue: "An EIR need not consider an alternative whose effect cannot be reasonably ascertained and whose implementation is remote and speculative." (CEQA Guideline 15126.6(f)(3).) Applying these criteria with the benefit of hindsight, the SEIR may not have been required to regard the connection to the City of Huntington Beach as feasible, but that determination could not have been definitively made without the administrative record now before the Commission. 7.2.3. Environmental Analysis of the Proposed Project The Proposed Project and each of the various alternatives have potentially significant adverse impacts that vary in severity and in the ability of mitigation measures to reduce their impacts. Section C of the Final SEIR describes and examines the environmental impacts associated with the Proposed Project. The detailed significant environmental impacts of the environmentally superior alternative and the other alternatives considered are presented in Section D of the Final SEIR. Tables D.5-1 and D.5-2 in the Final SEIR compare the major environmental issues of the alternatives with the Proposed Project. The mitigation measures for the Proposed Project are discussed in Section C of the Final SEIR. The Final SEIR includes a Mitigation Monitoring, Compliance, and Reporting Program for the mitigation measures proposed for the project in Section K. The roles and responsibilities of governmental agencies in implementing and enforcing the adopted mitigation measures are discussed therein. I - 37- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . . . 7.2.4. Significant Environmental Effects of the Proposed Project The environmental review indicates that the construction and operation of the Proposed Project will have significant adverse environmental impacts, which are typical of a project of this type and magnitude. Some of the adverse impacts can be mitigated or avoided; others cannot. Although there are significant adverse impacts that cannot be mitigated or avoided, we find that overall there are overriding considerations that make the Proposed Project worthwhile and cause us to grant approval of the Proposed Project. 7.2.4.1. Beneficial Impacts (Class IV) The Final.SEIR does not identify any beneficial effects to the environment from project construction and operation.. 7.2.4.2. Adverse, But Not Significant Impacts (Class III) The Final SEIR identifies a number of adverse, but less-than-significant impacts including: short-term air pollutant emissions during construction; minor air pollutant emissions and noise associated with project operation; traffic added to local streets by construction vehicles; effects on surface water quality; and construction impacts on residences, recreational facilities, and businesses. Because these impacts are not considered significant, no mitigation measures are required. The details of these impacts are described in Section C of the Final SEIR and summarized in Table ES-2. -38- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. 7.2.4.3. Significant Impacts That Can be Mitigated To a Level That Is Less Than Significant (Class II.lmpacts) The Final SEIR identifies several significant environmental effects of the Proposed Project that can be mitigated to a less- than-significant level or avoided. The Final SEIR includes a Mitigation Monitoring, Compliance, and Reporting Program to assure that mitigation measures are implemented effectively. The Mitigation Monitoring, Compliance, and Reporting Program set out in Section K of the Final SEIR describes how the following adverse effects will be mitigated or avoided. The program is based on the Proposed Project as described in Section B of the Final SEIR and the impact analysis presented in Section C. The following sections describe the significant but mitigable (Class II) impacts identified in the Final SEIR, including a description of each impact and the relevant mitigation measures. The impacts and mitigation measures are-described in more detail in Section C of the Final SEIR. 7.2.4.3.1. Noise Short-term construction noise could disturb land uses, e.g., business and residents, adjacent to the pipeline alignment. Mitigation Measures N-1 through N-3 include procedures to reduce noise impacts by requiring SCWC-to notify residents of construction timing, to implement complaint procedures, and to use noise reduction techniques on construction equipment. 7.2.4.3.2. Traffic and Circulation Project construction would have a short-term impact on local circulation and property access: vehicular access to adjacent properties could be temporarily blocked, and bus, bicycle, and pedestrian routes - 39- A.98-11-003, A.98-11-015 ALJ/JBW/epg .'. .'. .'. would be temporarily disrupted. Mitigation Measures T-3 through T-7 require advance.notification to businesses and residents of access disruptions, implementation of techniques to minimize access problems, coordination with transit providers to minimize disturbance to bus service, provisions for keeping bus stops accessible, and preparation of management plans for bicycle routes and pedestrian crosswalks affected by construction. 7.2.4.3.3. Environmental Contamination Construction through areas with contaminated soils could affect workers or the nearby public. Mitigation Measures EC-1 through EC-3 require site evaluation prior to construction so that contaminants and their locations are identified. These mitigation measures also require use of trained personnel to assess areas of contamination and develop procedures for worker protection, and hazardous material handling, treatment and disposal, as needed. All evaluations of contaminated sites require review and approval by the Commission, the County Health Department, and the Department of Toxic Substances Control prior to construction. Construction could also potentially disturb previously undiscovered areas of contamination. Mitigation EC-4 requires SCWC to assign trained personnel to be present during construction to observe excavation and perform testing as necessary when evidence of contamination is encountered. 7.2.4.3.4. Geology and Soils Various geologic hazards identified in the SEIR could damage and rupture the proposed pipeline, including strong ground shaking, liquefaction of soils, lateral spreading, and differential settlement. Mitigation Measures G-2 through G-4 require geologic/geotechnical investigations for the development of design measures to reduce the likelihood - 40- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. and severity of pipeline damage. The pipeline could also be damaged by the corrosive effects of local soils. Mitigation Measure G-4 requires further investigation of the presence, extent, and corrosion potential of soils along the pipeline alignment and the implementation of appropriate measures to minimize corrosion potential. 7.2.4.3.5. Cultural Resources Pipeline construction could disturb prehistoric site CA-ORA-83/86/144 or prehistoric site CA-ORA-84/85/288 on Bolsa Chica Mesa, or result in discovery of unrecorded cultural resources. Mitigation Measures CR-1 through CR-4 establish procedures to protect cultural resources by requiring SCWC to conduct testing in sensitive areas prior to construction, to monitor for cultural resources during construction, and to follow the recommendations of a qualified archaeologist if any resources are found during the course of construction. T7.2.4.3.6. Biological Resources Construction of the pipeline along Old Bolsa Chica Road has the potential to disturb nesting birds utilizing the adjacent riparian habitat in Bolsa Chica Channel. If construction is scheduled in this area during the nesting season, Mitigation Measure B-1 requires a survey of the area prior to construction to locate territorial pairs or nests of any birds listed under the Migratory Bird Act. Construction will avoid the area if territorial pairs or nests are located. 7.2.4.3.7. Public Services and Utilities During construction, lane closures and traffic congestion could impede local access for emergency service providers. Mitigation Measure PS-1 requires SCWC to coordinate with emergency service - 41- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. providers regarding construction in public streets, to provide advance notice of any anticipated access restrictions,.and to make provisions to accommodate emergency vehicles. 7.2.4.4. Significant Impacts That Cannot Be Mitigated To Insignificant Levels • (Class I Impacts) The Final SEIR identifies several significant effects of the Proposed Project that cannot be fully mitigated or avoided. Two of these impacts are temporary effects caused by construction activities - emissions of nitrogen oxides (NOx) from construction equipment emissions and increased traffic congestion during construction in heavily traveled streets. In addition, because the pipeline route crosses two fault zones, the potential for pipeline rupture during fault displacement cannot be completely avoided. As it is not possible to completely eliminate the adverse traffic and air quality effects of construction activities or to avoid pipeline damage from fault displacement, these impacts remain significant and unmitigable. The significant and unmitigable impacts described in the Final SEIR are the following: 1. The estimated maximum daily and quarterly emissions associated with construction of the pipeline would exceed the South Coast Air Quality Management District's (SCAQMD) significance thresholds for NOx (100 lbs/day). Nine mitigation measures are included in the SEIR (Section C.1 - Air Quality).to reduce NOx emissions through equipment specifications, specific engine maintenance procedures, use of certain electric- and solar-powered equipment, cessation of construction during smog alerts, scheduling equipment and material deliveries outside of peak traffic hours, and prohibition against prolonged - 42- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. vehicle idling. Emission levels are expected to exceed SCAQMD thresholds even with the implementation of the mitigation-measures prescribed in the SEIR. 2. The loss of roadway/intersection capacity during pipeline construction would adversely affect service levels along the Bolsa Chica Street/Road corridor. Mitigation Measure T-1 of the SEIR requires the preparation of detailed traffic control plans for construction that are to be reviewed and approved by local . cities (Section C.3 - Traffic and Circulation). The traffic control plans shall address permitted time periods for construction, placement of traffic control and warning devices, designation of detours and haul routes, and a coordination program with affected agencies. Mitigation Measure T-2 requires the implementation of a public information program to inform area residents, _ workers, and businesses to the construction and anticipated impacts to traffic. Despite the implementation of these measures, temporary but significant impacts to local traffic are still expected. 3. A large earthquake on the Newport- Inglewood Fault or the Los Alamitos Fault could cause pipeline rupture. Mitigation Measure G-1 of the SEIR requires SCWC to complete geologic/geotechnical investigation of the fault crossing locations and to implement specific design measures to reduce the likelihood of pipeline rupture in an earthquake (Section C.5 - Geology and Soils). Nevertheless, a large earthquake could still cause pipeline damage. - 43- A.98-11-003, A.98-11-015 ALJ/JBW/epg .'. .'. . . 7.2.5. Environmental Findings and Statement of Overriding Considerations As required by CEQA, we cannot approve the Proposed Project unless we find that the project has been modified to mitigate or avoid each significant effect on the environment, or that specific considerations make the mitigation measures or alternatives identified in the Final SEIR infeasible and specific overriding economic, legal, social, technological, or other benefits of the Proposed Project outweigh the significant effects on the environment. The following address (1) significant effects of the Proposed Project, and (2) alternatives considered. As described above, all significant impacts resulting from the Proposed Project cannot be avoided or eliminated. The significant and unmitigable effects of the Proposed Project include short-term NOx emissions, loss of roadway/intersection capacity, and potential pipeline rupture due to fault displacement. The NOx emissions are considered to be acceptable due to their relatively short duration, and the implementation of nine mitigation measures that will reduce construction emissions to the extent feasible. With respect to traffic circulation, this impact is considered acceptable given the temporary nature of the impact during the construction period only, plus the implementation of mitigation measures that require the development and use of traffic control/management plans. Construction of the pipeline will be contingent upon SCWC securing approval of a traffic control plan from each city affected by the Proposed Project. Lastly, with respect to potential pipeline rupture due to fault displacement, this impact is considered acceptable due to implementation of a mitigation measure requiring SCWC to incorporate design features intended to reduce the likelihood and severity of rupture (based on further geologic/geotechnical investigations). Therefore, the significant impacts - 44- A.98-11-003, A.98-11-015 ALJ/JBW/epg .'. .'. .•. of the Proposed Project are considered to be mitigated to the extent feasible, and as the benefits of the pipeline meet the objectives of the project in that in addition to provision of needed additional housing, they produce significant cultural and recreational benefits to the county, enhanced tax revenues, and a fire station, and they provide a long-term domestic water supply by means of constructing a water transmission system designed specifically to meet the particular projected domestic water demands and fire protection needs of the Bolsa Chica Planned Community, benefits of not inconsiderable public interest, and benefits considered to outweigh the potential impacts. As described in Sections 7.2.2.1-7.2.2.4, several alternative projects were considered in the SEIR, one of which was found to be environmentally superior to the project proposed by SCWC: connection to the City of Huntington Beach water system. While this alternative has environmental advantages, as discussed in Section 7.1 and 7.2.2.1, we are overriding this alternative in favor of the Proposed Project and its concomitant benefits. As explained in Sections 7.1 and 7.2.2.1. the Proposed Project is preferred over the remaining alternatives as it is more direct and offers the least amount of construction in public street rights-of-way and has relatively fewer sensitive land uses along its route. 7.2.6. Adequacy and Certification of the Final SEIR 7.2.6.1. Adequacy of the Final SEIR The Final SEIR must contain specific information according to CEQA Guidelines, Sections 15122 through 15131. The various elements of the Final SEIR satisfy these CEQA requirements. The Final SEIR consists of the Draft SEIR with minor revisions in response to comments and other information received. Section J of the Final SEIR contains the comments - 45- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . .•. received on the Draft SEIR along with responses-to these comments. (Guidelines, Section 15132.) 7.2.6.2. Certification of the Final EIR The Commission must conclude that the Final SEIR is in compliance with CEQA before finally approving the applications. The basic purpose is to insure that the environmental document is a comprehensive, accurate, and unbiased tool to be used by the lead agency and other decisionmakers in addressing the merits of the project. The document should embody "an interdisciplinary approach that will ensure the integrated use of the natural and social sciences and the consideration of qualitative as well as quantitative factors." (CEQA Guidelines, Section 15142.) It must be prepared in a clear format and in plain language. (CEQA Guidelines Sections 15006 (q) and (r); 15120; 15140.) It must be analytical rather than encyclopedic, and emphasize alternatives over unnecessary description of the project. (CEQA Guidelines, Sections 15006, 15141;Pub. Res. Code Section 21003(c).) Most importantly, it must be "organized and written on such a manner that [it] will be meaningful and useful to decisionmakers and the public." (Pub. Res. Code Section 21003(b).) We believe that the Final SEIR meets these tests. It is a comprehensive, detailed, and complete document that clearly discusses the advantages and disadvantages of the various alternatives compared to the Proposed Project. We find that the Final SEIR is the competent and comprehensive informational tool that CEQA requires it to be. The quality of the information therein is such that we are confident of its accuracy. We have considered that information in reaching that decision. The Commission should certify the Final SEIR. - 46- A.98-11-003, A.98-11-015 ALJ/JBW/epg .'. .'. .'. Comments on the Proposed Decision of the ALJ As provided by Pub. Util. Code § 311(d), the Proposed Decision (PD) of ALJ Weiss was served on the parties to this proceeding on April 4, 2000. Timely comments were submitted by Hearthside, the City and RRB. Timely reply comments were submitted by SCWC and Hearthside. In their comments both Hearthside and the City identified minor factual and typographical errors which have been corrected. Hearthside recommends adoption of the PD in its entirety, stating its view that each of the findings of fact and conclusions of law represent reasonable and appropriate reflections of the evidence of record. The City states that although the PD improperly imputes "no growth" motives to the City's protest, the City's opposition to the applications is because the City opposes development without annexation. But City avoided a preannexation agreement that would accept the Developer-County entitlement agreement. Citing various federal and state laws, it deprecates Heartheside's concerns. We believe the multi-year Background History in the PD speaks for itself as to the facts that lead to the PD's finding that the City was not "willing" to serve the Developer's project, but was willing to serve adjacent properties in the County. The City misconstrues the standard in Radisavljevic v. Cal-Am Water Co. (1979) 1 CPUC 2d 311. The SCWC extension at issue here is to logical natural boundaries (the Mesa), will provide service to a small unserved enclave, and is not gerrymandered to exclude customers - precisely the standard of Radisavljevic. With reference to the comments that approval of the applications would violate CEQA, we note that while the City alternative was identified in Subsection D.2.1 of the SEIR at the time of preparation of the SEIR as being environmentally superior and feasible, it was subsequently rejected in the PD based upon consideration of the administrative record which ultimately found - 47- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. the prospect of present City service to be infeasible (see Subsection 7.2.2.4 of the SEIR). RRB's comment repeats its hearing and briefing position that approval of the applications should be conditioned by a requirement that SCWC, in the event of a subsequent sale, condemnation, or transfer of the systems, should not receive compensation for the cost or value of the contributed plants. The City's comment supports RRB's position on this issue. As discussed in the PD, the Commissions historical position has been to address the matter on a case-by- case basis when the issue of a sale, condemnation, or transfer arises, and recent 1997 legislative history does not change the conclusion that the Commission should not prejudge either Superior Court or a future Commissions ability to adjudicate each case on its merits. SCWC's reply to the City's comment asserts that City wrongly accuses the PD of second-guessing City's reasons for requiring annexation before serving. SCWC states it is proper.for the PD to analyze the City's past actions and statements to ascertain whether the City is ready and willing to serve. SCWC notes that the cases City cites to support its contention that the PD should not examine "motives" are not on point. (For.example, Ensign Bickford Realty Corp. v. City of Council of Livermore (1977) 68 CAM, 467 dealt with a state court's standard of review of zoning ordinances in a mandamus proceeding; similarly, County of Del Norte v. City of Crescent City (1999) 71 CA 4th, 965 dealt with a state court's standard of review of a legislative act in a mandamus proceeding). As SCWC points out, the issue here is not whether the City's motives are proper, but whether the City's actions and motives support the finding that the City is not ready, willing, and able to serve the project. SCWC further notes that while the City's comments argue that the evidence shows it is "ready" and "able' to - 48- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . serve, City "coyly omits the crucial admission that it is "willing" to serve—as it has done throughout this proceeding. SCWC's reply to the RRB and City comments relative to conditioning the sale to a requirement that SCWC not receive any compensation for the contributed facilities in the event of a future sale, condemnation or transfer, states that these comments do not outweigh the Commissions rationale in D.82-01-062 (New Water Main Extension Rule) for not prejudging the issue, both as to future condemnation or voluntary scenarios. SCWC states this is an issue related to the amount of purchase price includable in a hypothetical future purchaser's rate base-not SCWC's rate base upon granting of the SCWC applications, and the issue is determined by Pub. Util Code § 2720(a) at present. SCWC observes that the legislative history of Pub. Util. Code § 2720 contradicts RRB. Contributed.plant may be considered in determining either fair market value and RCNLD value of the acquired system, and thus under Evidence Code § 820 would enhance the value to a purchaser, and could be attributed value in an appraisal. Hearthside's reply to the City's comment stresses that to date there has never been any representation by the City that it is willing to serve Hearthside's development, as is manifest by contrasting City's treatment of Hearthside vis-a-vis City's treatment of others outside its boundaries on the Bolsa Chica (where annexation has not been required). Hearthside further states that the fact that the SEIR erred on the conservative side by including review of a project alternative that may be feasible neither precludes the Commission from determining that the City alternative in reality is infeasible, nor requires recirculation of the SEIR simply to inform the public that an alternative considered was ultimately found by the decisionmaker actually to be infeasible. - 49- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . .•. The SEIR in no way considered, as the PD did, the demonstrated unwillin ess of the City to provide service as evidentiary proof of infeasibility of City service. Where appropriate, changes in the text of the decision have been made. No substantive changes to the decision have been otherwise deemed necessary or appropriate as the issues posed by the comments have been adequately addressed and resolved in the decision. Findings of Fact 1. SCWC is a Class A California public utility within the jurisdiction of the Commission, and provides water and sewer services to communities and governmental entities in the State. 2. Hearthside is the Developer for Signal Landmark, owner of the Mesa segment of the Bolsa Chica which is located in the unincorporated area of Orange County and subject to County and Coastal Commission jurisdiction as to land uses. 3. Hearthside holds entitlements to develop a 1,235 unit planned residential community on the approximate 220 acres of the Mesa pursuant to a 1995 County Bolsa Chica Local Coastal Plan approved by the Coastal Commission in 1996. 4. While the County provides various other services in the unincorporated areas, it does not provide water or sewer services, and Developers in these areas must turn to adjoining cities, districts or public utilities for these services. 5. Local interest groups, with considerable influence upon and membership on the City's Council, want the entire Bolsa Chica for open space, and repeatedly over many years have brought pressure as well as successive legal challenges to prevent or delay any development on the Bolsa Chica. 6. While the City is "able" to provide water and sewer services to Hearthside's development, being contiguous to Bolsa Chica on three sides, - 50- A.98-11-003, A.98-11-015 ALJ/JBW/epg .-. . . .•. despite offers of very substantial benefits involving millions of dollars from the Developers to do so, the City repeatedly has demonstrated that it is not "ready and willing" to do so, except possibly upon its terms which include annexation. 7. State law provides that a city cannot annex unincorporated areas without the consent of the landowners of the area it would annex. 8. Fearing that by annexation before its project is completed, it would suffer loss or diminishment of its County entitlements and administrative delays through City use of its police and permitting powers, thereby further endangering the owner's considerable financial investment in the project, Hearthside will participate and accept annexation only after the project is built. 9. Following years of unfruitful efforts to obtain water and sewer services from the City, except upon the City's terms, which in view of the City's past hostility the Developer with reason believes could jeopardize its entitlement and with virtual certainty spur further lengthy delaying legal challenges, Hearthside contracted with SCWC for the latter to incorporate the Mesa development project into SCWC's West Orange County District; construct a 7.5 mile, 18-inch interconnecting water transmission pipeline to the Mesa project, and provide sewer services to the Mesa project. 10. The Mesa project is not contiguous-to SCWC's local district. SCWC filed the present applications, seeking CPCN authorization for the utility to perform its contracts with the Developer. 11. The City, the Bolsa Chica Land Trust and the RRB filed timely protests to the SCWC applications. 12. Except for the short-term disruptions that would attend construction of an SCWC length of pipeline which could substantially be avoided by City source, there is little difference between the two as service providers, both have adequate - 51- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. . . . . water available; both would be competent to operate the relatively basic and simple on-site water and sewer systems contemplated, and the rates of both over a term are generally comparable when the City's lack of a monthly sewer charge is offset by its considerable sewer connection fee. 13. City service, if presently available, would be an environmentally superior alternative to SCWC service. 14. But by avoidance of a commitment to provide present service unencumbered by conditions, the City's protest when considered in context with its past and present actions appears merely a device to seek further delay, if not prevention of the Developer's Mesa project. 15. There is a present need for water and sewer services to the Developer's Mesa project and SCWC is "ready, willing, and able' to provide the services requested. 16. The City is not presently willing to provide the Developer's Mesa project the service requested,although it presently provides water service to the majority of adjacent, unincorporated area property owners; thus accepting services from SCWC is not a matter of picking or choosing between neighboring utility entities, rather it is a matter of accepting the only presently feasible alternative. 17. As water services rates and charges presently authorized by the Commission for SCWC's West Orange County District were determined to be just and reasonable for that district, and for the future must also be found just and reasonable before being authorized, application of these same rates and charges to the Planned Community addition to that district is reasonable. 18. As wastewater rates and charges proposed by SCWC to apply to the Planned Community will be based upon the projected costs to operate and - 52- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. . . maintain the wastewater system rather than upon any rate base, the rates proposed by the application should be authorized. 19. The proposed 6.75-mile pipeline is a necessary and integral element to enable SCWC to provide the services needed by the Developer's Mesa project. 20. The Commission is the lead agency under CEQA with respect to the environmental review of the Project and preparation of the Final SEIR. 21. The Commission has conducted an environmental review of the Project pursuant to CEQA. 22. The Final SEIR consists of the Draft SEIR, revised to incorporate comments received by the Commission from the proponent, agencies, and the public, and the responses to comments. 23. The Final SEIR has been completed in accordance with CEQA Guidelines, Sections 15120 through 15132. 24. The Commission has reviewed and considered the information in the Final SEIR before approving the Project. 25. The Final SEIR identifies significant environmental effects of the Project that can be mitigated or avoided to the extent that they become not significant. The Final SEIR describes measures that will reduce or avoid such effects. 26. The mitigation measures identified in the Final SEIR are reasonable. 27. As lead agency under CEQA, the Commission is required to monitor the implementation of mitigation measures adopted for this Project to ensure full compliance with the provisions of the monitoring program. 28. The Mitigation Monitoring, Compliance, and Reporting Plan in Section K of the Final SEIR conforms to the recommendations of the Final SEIR for measures required to mitigate or avoid environmental effects of the Project that can be reduced or avoided. - 53- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. 29. The Commission will develop a detailed implementation plan for the Mitigation Monitoring, Compliance, and Reporting Plan. 30. The Final SEIR identifies connection to the City of Huntington Beach as the environmentally superior alternative to the Proposed Project. 31. The Final SEIR identifies several significant environmental effects of the Project that cannot be mitigated or avoided, as follows: (a) the estimated maximum daily and quarterly emissions associated with construction of the pipeline would exceed the South Coast Air Quality Management District's significance thresholds for NOx (1001bs./day); (b) the loss of roadway/intersection capacity during pipeline construction would adversely affect service levels along the Bolsa Chica Street/Road corridor; (c) a large earthquake on the Newport-Inglewood Fault or the Los Alamitos Fault could cause pipeline rupture. 32. For significant effects where no feasible mitigation exists to reduce the environmental effects to,less than significant, the specific overriding benefits of the Project, including substantial monetary inputs to the County's Mesa Conservation Fund and a child care center, traffic improvements, substantial additions to Wieder Regional Park, contributions to a Park ecological interpretative center, additional pedestrian and bicycle trails, a new fully equipped fire station, tax revenues, and additional housing and jobs, outweigh the significant effects on the environment. Conclusions of Law 1. SCWC is the only service provider unconditionally presently "ready, able, and willing" to provide water and sewer services to the Developer's Mesa project and to construct the necessary pipeline. 2. Commission approval of SCWC's applications is in the public interest. - 54- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. 3. The processing of the SEIR in this proceeding complies with the requirements of CEQA. 4. The contents of the Final SEIR comply with the requirements of CEQA and represent the Commission's independent judgement. 5. The Final SEIR should be certified for the Project in accordance with CEQA. 6. The approval of the application as provided herein should be conditioned upon the completion of the mitigation measures identified in the Final SEIR. O R D E R IT IS ORDERED that: 1. A Certificate of Public Convenience and Necessity is granted to Southern California Water Company (SCWC) to effect a non-contiguous extension of its West Orange County District to include the Bolsa Chica Mesa Planned Community on the Bolsd Chica being developed by Hearthside Homes, Inc. (Hearthside); to provide public utility water distribution and wastewater collection services within the Bolsa Chica Mesa Planned Community; and to construct a 6.75-mile water transmission pipeline to interconnect the SCWC West Orange County System with the planned on-site water distribution system at the Bolsa Chica Mesa Planned Community. 2. Within 60 days after the effective date of this order, SCWC shall file with the Commission, in conformity with General Order (GO) 96-A, a tariff service area map applicable to the extension service area certified. 3. Within 60 days after initiation of service, SCWC shall file for each system a comprehensive map, drawn to an indicated scale not smaller than 300 feet to the inch, delineating by appropriate markings the tract of land and territory - 55- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. certificated herein for each utility system, the principal water distribution facilities and sewer collection facilities; and the location of the various system properties of SCWC used to provide the services. 4. Once service is initiated, SCWC is authorized to charge such water service rates and tariffs in the Bolsa Chica Mesa Planned Community as are in effect concurrently in SCWC's West Orange County District. . 5. Before service is initiated, SCWC is authorized and directed to file with this Commission, in conformity with GO 96-A, the schedule of rates and charges shown in Appendix B attached hereto, and upon not less than five days' notice to the Commission and to the resident customers, to make said rates effective for wastewater services rendered thereafter. 6. Within 10 days of the event, SCWC shall notify the Commissions Executive Director in writing of the date service is first rendered to the public by each utility system under the rates and tariffs authorized herein. 7. The Final Supplemental Environmental Impact Report (SEIR) is certified as the EIR for the Project which is the subject of the applications and is certified for use by responsible agencies in considering subsequent approvals for the Project, or for portions thereof. 8. SCWC shall, as a condition of approval, comply with all mitigation measures specified in Section K of the Final SEIR (which is reproduced in Appendix A attached hereto) as directed by the Executive Director. 9. The Executive Director shall supervise and oversee construction of the Project insofar as it relates to monitoring and enforcement of the mitigation conditions described in Appendix A. The Executive Director may delegate his duties to one or more Commission staff members or outside staff. The Executive Director is authorized to employ staff independent of the Commission staff to - 56- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. carry out such functions, including, without limitation, the on-site environmental inspection, environmental monitoring, and environmental mitigation supervision of the construction of the Project. Such staff may be individually qualified professional environmental monitors or may be employed by one or more firms or organizations. In monitoring the implementation of the environmental mitigation measures described in Appendix A, the Executive Director shall attribute the acts and omissions of SCWC's employees, contractors, subcontractors, or other agents to SCWC. SCWC shall comply with all orders and directives of the Executive Director concerning implementation of the environmental mitigation measures described in Appendix A. 10. The Executive Director shall not authorize SCWC to commence actual construction until SCWC shall have entered into a cost reimbursement agreement with the Commission for the recovery of the costs of the mitigation monitoring program described in Appendix including, but not limited to, special studies, outside staff, or Commission staff costs directly attributable to mitigation monitoring. The Executive Director is authorized to enter into an agreement with SCWC that provides for such reimbursement on terms and conditions consistent with this decision in form satisfactory to the Executive Director. The terms and conditions of such agreement shall be deemed conditions of approval of the application to the same extend as if they were set forth in full in this decision. 11. SCWC shall file a written notice with the Commission, served on all parties to this proceeding, of its agreement, executed by an officer of SCWC duly authorized (as evidenced by a resolution of its boards of directors duly authenticated by a secretary or assistant secretary of SCWC) to acknowledge SCWC acceptance of the conditions set forth in Ordering Paragraphs 8 through - 57- A.98-11-003, A.98-11-015 ALJ/JBW/epg .•. .•. .•. 10 inclusive. Failure to file such notice within 45 days of the effective date of this decision shall result in the lapse of the authority granted by this decision. 12. The Executive Director shall file a Notice of Determination for the Project. as required by the California Environmental Quality Act and the regulations promulgated pursuant thereto. •13. Upon satisfactory completion of the Project, a notice of completion shall be filed with the Executive Director by the Energy Division. 14. Application (A.) 98-11-003 and A.98-11-015 are closed. This order is effective today. Dated October 5, 2000, at San Francisco, California. HENRY M. DUQUE JOSIAH L. NEEPER RICHARD A. BILAS Commissioners I dissent. /s/ LORETTA M. LYNCH President I dissent. /s/ CARL W. WOOD Commissioner - 58- A.98-11-003, A.98-11-015 ALJ/JBW/epg APPENDIX A NOTE The Final Supplemental Environmental Impact Report was mailed to selected active parties to the application. Hard copy is available at CPUC Central Files and it is also posted on the Commissions web site at http://www.cpuc.ca.gov/Static/Environment/info/aspen/bolsachica/fseir/fseir.htm. A.98-11-003, A.98-11-015 ALJ/JBW/epg APPENDIX B SOUTHERN CALIFORNIA WATER COMPANY GENERAL METERED TO RESIDENTS' SEWER APPLICABILITY Applicable to all Planned Community sewer collection service. TERRITORY The Planned Community, Bolsa Chica Mesa, Orange County, California. RATES Per Month For all water used Per 100 cubic feet $0.267 Minimum charge $6.00 SPECIAL CONDITIONS: All bills are subject to the Public Utilities Commission Reimbursement Fee. (END OF APPENDIX B) ATTACHMENT #3 O'MELVENY & MYEM LLP CENTURY CITY 400 South Hope Street TYSONS CORNER IRVINE SPECTRUM Los Angeles, California 90071-2899 I 16 M aI 1 S TON,D.C. MENLO PARK F 3) 43 Cl HONG KONG (21 o-6000 TELEPHONE t;„v; f a NEWPORT BEACH FACSIMILE 21 o-6 0 r A T i 0R S r y LONDON :L::c: ; NEW YORK INTERNET:WWW.OMM.COM T pv L=,^�0rt SHANGHAI SAN FRANCISCO TOKYO OUR FILE NUMBER August 13, 2002 814,675-999 WRITER'S DIRECT DIAL 213-43o-6270 WRITER'S E-MAIL ADDRESS Gail Hutton, Esq. jcolbert@omm.com City Attorney City of Huntington Beach Civic Center 2000 Main Street Huntington Beach, California 92648 Re: Application of Southern California Water Company for Franchise Dear Ms. Hutton: We represent the Southern California Water Company (the "Water Company"), and I am writing regarding the Water Company's long-standing application for a franchise to use the subsurface of the City's streets for the purpose of extending water and sewer service to a contemplated development adjacent the City's south boundary. As you are aware, this project has the approval of the California Public Utilities Commission ("CPUC") which has authorized the Water Company to extend the service in question. Notwithstanding that fact, the City has thus far refused to issue the franchise and the necessary permits to open the streets, apparently contending that it has discretion to refuse the franchise to the Water Company because of the City's opposition to the development to be served. It is our understanding that the City Council has scheduled, or will soon schedule, consideration of the issuance of the franchise on its public calendar and that the City Council intends to debate the "policy" question of whether the franchise should issue as requested. The City Council does not have the discretion that it apparently believes it possesses and lacks the authority to make the "policy" decision that it apparently contemplates. Article XII, Section 8 of the state constitution expressly prohibits municipal regulation in areas subject to CPUC regulation: F. � � 1 O'MELVENY &MYERS LLP Gail Hutton,Esq.,August 13,2002-Page 2 "A city, county, or other public body may not regulate matters over which the legislature grants regulatory power to the [Public Utilities Commission] . . . ." This is true whether or not the municipal regulation is in conflict with or consistent with the regulation of the CPUC. People v. Levering(1981) 122 Cal. App. 3d 19, 20-21. As the Court of Appeal explained in California Water & Telephone Co. v. County of Los Angeles (1967) 253 Cal. App. 2d 16, 30-31, another case involving a water utility, this constitutional prohibition reflects the important policy of avoiding local interference with the state-wide concern of providing adequate utility service: "[T]he construction, design, operation and maintenance of public water utilities is a matter of state-wide concern. Of course, the [local governmental body] is vitally interested in the adequacy of the water supply available for fire protection. But the interest is not so parochial. All of the citizens of the complex of communities within the County of Los Angeles and in neighboring counties are affected by the adequacy of water supply, not only for fire protection but also for other domestic and industrial uses. Under such circumstances, the control of these aspects of water utilities is not a municipal affair subject to a checkerboard of regulations by local governments." As the Court further noted, "'Neither the public nor the service corporation could tolerate as many standards and policies as there were towns, cities, or boroughs through which they operated . . . [R]egulations not exclusively local, those affecting the [public utilities] business as a whole, or affecting the public as a whole, and those which the nature of the business and the character of the regulation require should be under the single agency of the state, are by our own act committed to the exclusive jurisdiction of the Public Utilities Commission."'Id. at 31, quoting Los Angeles Railway Corporation v. Los Angeles (1940) 16 Cal. 2d 779, 787. The power of a municipality to grant utilities a franchise for the use of the public streets cannot be used as a subterfuge to frustrate this policy. Control of the streets cannot be employed to restrict or regulate the provision of services by the utility to the public. Redevelopment Agency of the City and County of San Francisco v. P.G. & E. Co. (1983) 76 Cal. P.U.C. 77. In the exercise of its police power, a city may require that a utility obtain a permit before excavating in the streets to make use of the franchise, but the power to control excavation in its streets does not give the city the right to second- guess the design or desirability of a project being implemented by a utility under the jurisdiction of the CPUC. The legitimate exercise of that power is limited to concerns O'MELVENY &MYERS LLP Gail Hutton,Esq.,August 13, 2002-Page 3 respecting traffic and safety attendant upon the surface excavation. See In re Keppelmann, (1914) 166 Cal. 770, 773. As a leading treatise has explained: "The purpose of the permit is to give notice to the municipality that a certain street or part of it is about to be excavated so as to enable the corporate authorities to take the necessary steps to guard the excavation or compel the company to do so, in order that municipal liability for damages for injuries received by third persons from such excavations may not arise." 12 McQuillin, The Law of Municipal Corporations, § 34.76. As the California Supreme Court has held in striking down an attempt to use the police power over the streets to control utility activities: ". . . the exercise by a municipality of the police power over its streets is limited to the protection of the public in their use of the streets, and does not include a limitation on their use for any legitimate purpose." In Re Johnston (1902) 137 Cal. 115, 122 (emphasis added). In the leading case of In re Keppelmann, supra, 166 Cal. 770 at 773-75, the California Supreme Court cautioned that the permitting process may not be used to prohibit utility access to the franchise by refusal to grant a permit. The process may only be used to protect the use of the streets. If the utility complies with conditions imposed for that purpose, issuance of a permit is mandatory. See also Pacific Telephone & Telegraph Co. v. City of Los Angeles (1955) 44 Cal. 2d 272, 281 (reservation to city of power to grant franchise to telephone company for installing and maintaining lines authorizes only regulation of"the manner in which the company might use the public streets"). These principles were recently reaffirmed in Southern California Gas Company v. City of Vernon (1995) 41 Cal.App.4t1' 209, a case that we handled for the Gas Company. The contemplated action of the City Council is in direct violation of these principles. The City has no discretion to pass on the wisdom of the Water Company's provision of service to the planned development, no matter how strongly the City Council may feel about that development. The City's authority is limited to the ministerial _ question of assuring that the Water Company's construction project does not threaten the safety of its streets or unduly interfere with the public's use of those streets. I trust that, upon reflection and with your counsel, the City Council will recognize the limitations that the law imposes on the City's authority in this area. If not, however, O'MELVENY &MYERS LLP Gail Hutton,Esq.,August 13,2002-Page 4 we have been authorized to institute litigation to compel the City to comply with its obligation to issue the franchise requested. Please advise if that will be necessary. Very truly yours, r &v-AA z) F' J es W. Colbert III Of 'MELVENY&MYERS LLP JWC:st cc: Patrick Scanlon Southern California Water Company LA2:632748.1 ATTACHMENT #4 I 1 b i1.1 r•1�,ra s1'er,rises '`' / "° Z 22 " -ono l j # i s aU '2, a N jsrlc'�rr.d` Ff 5 Sli1:x� t rr,r%•�'4�,. �n Mr G'�rri D uY1 t �.z�}Lr1�P f>•7+ .r'*" �5w+ , '>r 5 ` 3 �4b Y n 1 rr �, o tut'i.s,�tKir �•n�t€s��>,v a krra?is ,�r ��khcTyf�;r.4� 1 'wrik�? "��t ar.'.r sy. �' �")t• St t ���;l�� -{'h�'.1'L�a��'.� \ � ,`�fr�i„a Ri y �r, i+r'a,.\f•.y g'r,��• 7 '� ��p��� ��' ly";�•y^� \ r r + I t > C{t r� n � S � • n ma y ' ►�I I }i,���"�',C F° }P t 1 !r t`�1 �f'ram{ t•+.1 ,i ' $ r 1 � ,I \\\ �rg, o I rt*�Ri Sy tir y` rbr i7 1 �' } fI� � SSS I 7 ca , f r CF xc f? •!pP r , � r r # a \ jy a/tiyrt r r t /G a? 4y: ''' t �' d •,'`" y �a('�r Tq�� \ �.y F tfa,. CD . `•i1r�a I `.'. �'s) ':�d� �t .� ct c.'S,s iiy7�� Oil ' ^ I `;�7 U�a�tr4 }D'YJ,r R ,� 'rIN'P I't d t ! &l.� {.RfC t. '`C' Y'��•: �•i.1 I `.�7L' 'd � tt+ ' �A i�� s + + 1*�f s + rs '}1 L ��' ^\ ® }•� I t ! �r � 4 I h Y� 71 S y 7' ! h \ /4 CR I h 4 �C; \ Lr'.A E ('} I ";dam/Yt! '•' n r 'h "l�'. A kF/`�;.. .s( ': r x Cat{:' r �, � yF IRt'�'+ xr`� / I '.r*r 4 t '. y.1� t r13 a,t i >_ a to a 1'�+ *+r $r�u T• + I � r � N 4 y 4 �` '.s � y 'ir ftJ" L, ��. —�•'t_� Vr � 'Y� �y�;�w ti •+s � , r s�^ 1 �a h. f {1 4 f,' 'tc { +• Y sum !` j ��y !§�'to !' .i � f.r't°`' ° H`S sy u � f��. �.r•' 1 �R`rtt r �5 S :tier,�ysF} ,}i S. w •r!' t,}tSR°t s'?4 a*c'` r<�r�, .��c���:r1. M'{ ` ^n Yr"CFy +ter why�+j1,;r. ti'. c s Sf sR Laf r:t „�� }>• . I t i 'TS✓ r r a t � r 3 ,}1.f # Y O rya CD ^S I `H n iV / �—Auvaww��ioz'47u� ATTAC H M E N T #5 4 . 1 -l I Sunset Muafic� Regional Park l I Bolra Chico EDINGER AVE. .............. UNWrNGTON 2 \` HARBOUR HEIL AVE. . ```"�• - - - f'AN*N GNOME VANTI3SBURG FLOOD COMIOI C1UW1@L `•�` Z WARNER AVE LOS$ATOS AVE. _ BRIGHTWATER - `� SLATER AVE. WARNER MESA \ I Hunfington Central Park \`.OUTER BOLSA BAY �` I-- ISOLATED \ TNBERT yF_-- �`� POCKET AREA STATE ECOLOGICAL �`. RESERVE OVERLOOKS BOLSA CHICA EKISIING STATE `.�y, LOWLAND . RESERVE PARKING INNER BOLSA BAY f GARFIELD AVE. Harriett Weider Regional Park (Future) PACIFIC OCEAN LEGEND BRIGH TwATBt PROJECT AREA �——� PLANNED COMMUNITY BOUNDARY COASTAL ZONE BOUNDARY COUNTY-HUNTINGITON BEACH BOUNDARY Exhibit L 1-2 BRIGHTWATER Vicinity Map _ A' * 0 600 1200 xsr m zwl H� SI� w"may- HoNlJ s m+/ratio%ao/ci-as/an�rt,/ Existing Residential o�Je m o Existing Residential Development 56sting Residential Development PJ c -C Development U F m a- COU ' F ORnNCE�I,t �` i�I I'� 6asfing I ) Warner e � /I( ��—% — Sandover "� I .� ' 'I Pond J�/j 3 .1 - GRod I Properly •/ � `� �`\�` L'i \`\ O \\ p. t �-��, `may - Pro LEGEND BWGHiWAMR PROJECT BOUNDARY S'�-` ' �)�\ ,:'::�:;, ( lr PLANNED COMMUMTY BOUNDARY u '--�� -.' f ~) n\ ✓� ! . DEVEIOPMENTAREABOUNDARY ` �- \ _��'�- / // •-- /�ij� j 7-Z DEil9.OPMENTAREA DESIGNATION PWAPIq '`� j�,� !G `�• �,� L � /�� •!, �i �/�I ` =j;_�� '''1 'Statq�%party I \ `�✓,.�i%�:- - I Exhibit H..1-1 BRIGHTWATER - Master Development Plan 8 FC" J --T-Trevr"rrr`c ATTACHMENT #6 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6201-6205.1 Page 1 of 3 FindLaw I Legal Professionals I Students I Business I Public I News E-mail@Justice.com FindLaw' for Legal Professionals Cases&Codes I Forms I Legal Subjects I Federal I State I Library I Boards Law Firm FirmSites I Le Lawyer Search JCityorZlP _ State L I Select a Practice Area ' 11 _._._. Searcht, FindLaw FindLaw: FindLaw California : Codes and Statutes : California Code : Public Utilities Code Center Click Here! . California Codes o California Public Utilities Code ■ PUBLIC UTILITIES CODE SECTION 6201-6205.1 6201. This chapter may be cited as the Franchise Act of 1937. Thousands of Corporate Counsel 6201.3. As used in this chapter, "industrial gas" means any Attorneys substance which is in a gaseous state at ambient conditions of temperature and pressure used for commercial, industrial, or Can't Be scientific purposes, but does not include any gaseous hydrocarbon Wrong used for light, heat, power, or feedstock. 6201.5. As used in this chapter, municipality includes counties, but no county shall grant a franchise pursuant to this chapter in any incorporated area. FindLaw Newsletters 6202. The legislative body of any municipality may grant a C .:Top Legal franchise to any person, firm, or corporation, whether operating News Headlines under an existing franchise or not, to use, or to construct and use, 177, Legal Grounds poles, wires, conduits, and appurtenances for transmitting and 177,distributing electricity for all purposes, or to use, or to lay and Labor& use, pipes and appurtenances for transmitting and distributing gas ol�mploymentLaw industrial gas for all purposes, or to use, or to lay and use, pipes and appurtenances for transmitting and distributing oil or products Youremailhe thereof for all purposes, or to lay and use pipes, ditches, flumes, SUbSCribe;, conduits, and appurtenances for transmitting and distributing water for all purposes, under, along, across, or upon the public streets, More. ways, alleys, and places within the municipality, upon the terms and Newsletters conditions provided in this chapter. MY FindLaw 6203. The legislative body may in such a franchise impose such Email: other and additional terms and conditions not in conflict with this chapter, whether governmental or contractual in character, as in thgassword: F777 judgment of the legislative body are to the public interest. Keep me logged in r until I sign out. http://caselaw.1p.findlaw.com/cacodes/puc/6201-6205.l.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6201-6205.1 Page 2 of 3 =Sign n�a Forgot Your Password? 6204 . This chapter provides a procedure, alternative to the di.ckhere_! procedure provided in Article 1 of Chapter 1 of this division, for New..User.._? the granting of franchises by municipalities. When any proceeding is Click Here! initiated under this chapter for the granting of a franchise, the provisions of this chapter exclusively govern the granting of such franchise. 6205. This chapter does not apply to any municipality having a .freeholders' charter adopted and ratified under the Constitution and having in such charter provisions for the issuance of franchises by the municipality, but nothing contained in this chapter shall restrict the right of any such chartered municipality to avail itself of the provisions of this chapter wherever it may lawfully do so. The provisions of this chapter relating to the payment of a percentage of gross receipts shall not be construed as a declaration of legislative judgment as to the proper compensation to be paid a chartered municipality for the right to exercise franchise privileges therein. 6205. 1. (a) Notwithstanding Section 6205, all franchises, licenses, permits, or other privileges granted to a public utility by any city, county, or city and county holding a freeholder's charter containing provisions for the issuance of franchises, to use, or to construct or lay and use, under, along, across, or upon the public streets, ways, alleys, and places within the municipality, facilities which are part of a pipeline system transmitting oil or products thereof, shall be granted upon the terms and conditions provided in, and in accordance with, either this chapter or Chapter 1 (commencing with Section 6001) . (b) On and after January 1, 1990, the compensation to be paid for the franchises, licenses, permits, or other privileges granted by any city, county, or city and county, including those holding a freeholder's charter, shall be as provided in Section 6231.5. (c) It is the intent of the Legislature, in enacting this section, to preempt the ordinance of any chartered municipality insofar as that ordinance governs the granting of franchises to construct facilities which are part of a pipeline system transmitting oil or products thereof. Previous Return to Top Next ADRWorI_d..com: ADRWorld.com is your single source on the web for up-to-the-minute news of alternative dispute resolution. Amicus Attorney_: Click Here to receive your FREE evaluation copy version of our practice management software. NEW VERSION Princeton Review: LSAT test prep and more from The Princeton Review-click here! TimeMatters: The most widely used, most award-winning practice management software. Click Here! U.S. Legal Forms, Inc.: **Over 25000 Legal Forms! **A unique legal forms site on the Internet providing legal forms to lawyers, businesses and the public. State specific forms in many areas. Abacus Law: Calendar crisis? Never again! Find out how 100,001 users stop it using Abacus Law Practice http://caselaw.1p.findlaw.com/cacodes/puc/6201-6205.l.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6231-6235 Page 1 of 5 FindLaw I Legal Professionals I Students I Business I Public I News E-mail@Justice.com FindLaw J Get Your Firm on the Web 1 f . ra, Legal Professionals Click here for more information = Go! Cases&Codes I Forms I Legal Subjects I Federal I State I Library I Boards Law Firm FirmSites I Le L_ w er Search lcityorZIP State = Select a Practice Area ;Corporate Counsel Find �`- Search) FindLaw ice; FindLaw: FindLaw California : Codes and Statutes : California Code :Public Utilities Code ..._.... ......... ......... ......... ._.. __...- -------.... Center Click Here! . California Codes --- .... o Califomia Public__Utilities..Code - ■ PUBLIC UTILITIES CODE SECTION 6231-6235 a � �t ntanll ie [I 6231. An applicant for a franchise shall file with the legislative �. body of the municipality in which the franchise is desired an ' supreme application stating all of the following: `W- Court (a) The name of the applicant. (b) The purpose and term, whether definite or indeterminate, fore which the franchise is desired. (c) That the applicant if granted the franchise will pay to the � x v- municipality during the life of the franchise 2 percent of the applicant's gross annual receipts arising from the use, operation, ony-a FInd1r, possession of the franchise, except that this payment shall be not 1StCircuit ! less than 1 percent of the applicant's gross annual receipts derived - from the sale within the limits of the municipality of the utility Go! service for which the franchise is awarded. If the application is for a franchise complementary to a franchise derived under Section 19 of Article XI of the California Constitution as that section existed FindLaw prior to its amendment on October 10, 1911, then the applicant shall Newsletters pay annually, if the application is for an electric franchise, 2 percent of the applicant's gross annual receipts arising from the r Top Legal use, operation, or possession of the franchise, except that this News Headlines payment shall be not less than one-half of 1 percent of the applicant Legal Grounds s gross annual receipts from the sale of electricity within the limits of the municipality under both the electric franchises; or, if-Labor& the application is for a gas, oil pipeline, or water franchise, 2 Employment Law percent of the applicant's gross annual receipts arising from the use, operation, or possession of the franchise, except that this Youremailhe payment shall be not less than 1 percent of the gross annual receipts) _ �.__b0- Subscrie from the sale of gas or water within the limits of the municipality under both the gas franchises or both the water franchises. More Notwithstanding any other provision of this section, if the Newsletters application is for a franchise for a nonpublic utility pipeline for industrial gas or oil or products thereof, the application shall state that the applicant, if granted the franchise, will pay to the MY FindLaw municipality during the life of the franchise either a specified percentage agreed to by the applicant and the municipality of the Email: gross annual receipts of the applicant arising from the use, operation, or possession of the franchise or an annual franchise feeassword: in an amount agreed to by the applicant and the municipality or an �-- Keep me logged in annual franchise fee computed by multiplying the sum of one-half ce r until l sign out. ($0.005) times the nominal internal diameter of the pipe, expressed http://caselaw.1p.findlaw.com/cacodes/puc/6231-6235.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6231-6235 Page 2 of 5 in inches, times the number of lineal feet of the pipe within the public streets, ways, alleys, or other public places within the Slgnln= municipality. Forgot Your Password? click here! New User ? Click Here! 6231.5. (a) An applicant for a franchise to build and operate a pipeline system transmitting oil or products thereof shall file with the legislative body of the municipality in which the franchise is desired an application stating all of the following: (1) The name of the applicant. (2) The purpose and term, whether definite or indeterminate, for which the franchise is desired. (3) That the applicant, if granted the franchise, permit, license, or other privilege, will pay to the municipality an annual fee computed as follows: The length of pipe expressed in feet located within the franchised area shall be multiplied by the applicable base rate, as adjusted pursuant to subdivision (d) , in accordance with the following schedule: Pipe size (internal Base rate per diameter in inches) lineal foot 0-4 . . . . . . . . . . . . . . . . . . . . . . . . . $0.088 6 . . . . . . . . . . . . . . . . . . . . . . . . . 0.132 8 . . . . . . . . . . . . . . . . . . . . . . . . . 0.176 10 . . . . . . . . . . . . . . . . . . . . . . . . . 0.220 12 . . . . . . . . . . . . . . . . . . . . . . . . . 0.264 14 . . . . . . . . . . . . . . . . . . . . . . . . . 0.308 16 . . . . . . . . . . . . . . . . . . . . . . . . . 0.352 18 . . . . . . . . . . . . . . . . . . . . . . . . . 0.396 20 . . . . . . . . . . . . . . . . . . . . . . . . . 0.440 22 . . . . . . . . . . . . . . . . . . . . . . . . . 0.484 24 . . . . . . . . . . . . . . . . . . . . . . . . . 0.528 26 . . . . . . . . . . . . . . . . . . . . . . . . . 0.572 28 . . . . . . . . . . . . . . . . . . . . . . . . . 0. 616 30 . . . . . . . . . . . . . . . . . . . . . . . . . 0. 660 For pipelines with an internal diameter not listed above, the fees shall be in the same proportion to the fees of a 12-inch-diameter pipe as the diameter of the unlisted pipe is to 12 inches. (b) The annual payment for each lineal foot of pipeline shall be computed and revised each calendar year as follows: (1) The applicable base rate shall be multiplied by the Consumer Price Index for the area, as published by the United States Department of Labor, Office of Information for the month of September immediately preceding the month in which payment is due and payable, and divided by the Consumer Price Index for June 30, 1989, which is declared to be 100. 0. Under no circumstances shall the multiplying factor be less than one. (2) If the United States Department of Labor, Office of Information discontinues the preparation or publication of a Consumer Price Index for the area, and if no translation table prepared by the Department of Labor is available so as to make those statistics which are then available applicable to the index of June 30, 1989, the municipality shall prescribe a rate of payment which shall, in its judgment, vary from the rates specified in this section in approximate proportion as commodity consumer prices then current vary from commodity consumer prices current in December 1988. On this http://caselaw.1p.findlaw.com/cacodes/puc/6231-6235.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6231-6235 Page 3 of 5 point, the determination by the municipality shall be final and conclusive. (c) No fee paid to any municipality pursuant to a franchise, permit, license, or other privilege issued under an ordinance which is in effect on September 1, 1989, which exceeds the fee computed under this section shall be reduced. On or after January 1, 1990, a municipality may collect an additional amount which represents the percentage increase in the Consumer Price Index for the area during the preceding calendar year applied to that fee. The formula used in arriving at that fee shall be applicable to any replacement, modification, or extension of the pipeline. Upon expiration of a franchise, permit, license, or other privilege, the municipality may renew or extend the franchise, permit, license, or other privilege, using the local formula contained in an ordinance which is in effect on September 1, 1989. However, the fee shall not exceed the greater of the fee actually paid on September 1, 1989, or the fee computed pursuant to this section. (d) Notwithstanding any other provision of law, until January 1, 1990, a municipality which is involved in eminent domain proceedings in which a court order for possession has been issued relating to an easement for a pipeline system transmitting oil or products thereof may adopt an ordinance setting its fee without following the provisions of this section. Upon expiration of the ordinance, the municipality may renew or extend the franchise, license, permit, or other privilege, utilizing the local formula in effect on January 1, 1990, or the fee computed pursuant to this section, whichever is greater. (e) Notwithstanding any other provision of this section, if the application is for a franchise for a nonpublic utility pipeline for industrial gas or oil or products thereof, the application shall state that the applicant, if granted the franchise, will pay to the municipality during the life of the franchise either of the following: (1) A specified percentage agreed to by the applicant and the municipality of the gross annual receipts of the applicant arising from the use, operation, or possession of the franchise. (2) An annual franchise fee in an amount agreed to by the applicant and the municipality, or an annual franchise fee computed by multiplying the sum of one-half of the nominal internal diameter of the pipe, expressed in inches, by the number of lineal feet of the pipe within the public streets, ways, alleys, or other public places within the municipality. (f) Any nonpublic utility pipeline system transmitting oil or products thereof covered by subdivision (e) on December 31, 1989, that converts to public utility status shall continue to pay the fee established pursuant to subdivision (e) for the remaining term of its franchise, license, permit, or other privilege. Upon expiration of its franchise, license, permit, or other privilege, a nonpublic utility pipeline system transmitting oil or products thereof that has converted or seeks to convert to public utility status shall establish to the satisfaction of the franchising authority all of the following: (1) Its property is dedicated to the service of the public. (2) Its rates for transportation are established pursuant to tariffs filed with the Public Utilities Commission. (3) Its accounts and records are established pursuant to rules and regulations adopted by the commission. (4) It has filed an appropriate annual report with the commission. (5) Its rates for transportation are just, reasonable, and http://caselaw.1p.findlaw.com/cacodes/puc/6231-6235.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6231-6235 Page 4 of 5 nondiscriminatory, as evidenced either by an order of the commission approving those rates, or an application for approval of its rates that is pending with the commission. 6232. Upon receipt of the application the legislative body of the municipality may pass its resolution declaring its intention to grant the franchise applied for, stating the character of the franchise, setting forth a notice of the day, hour, and place when and where all persons having any objection to the granting thereof may appear before the legislative body and be heard thereon, and directing the clerk of the legislative body to publish the notice at least once within fifteen (15) days after the passage of the resolution in a newspaper of general circulation within the municipality. The time fixed for the hearing shall be not less than twenty (20) nor more than sixty (60) days after the date of the passage of the resolution. 6233. The notice of the time and place of hearing objections shall state that the grantee of the franchise and its successors and assigns will, during the life of its franchise, pay to the municipality the percentage specified in its application, that the percentage will be paid annually from the date of the granting of the franchise, and in the event such payment is not made the franchise will be forfeited. The notice shall also designate the term, whether definite or indeterminate, for which the franchise is proposed to be granted. 6234 . At any time not later than the hour set for the hearing of objections, any person interested may make written protest stating objections against the granting of the franchise. The protest shall be signed by the protestant and be delivered to the clerk of the legislative body. At the time set for hearing objections the legislative body shall proceed to hear and pass upon all protests so made and its decision shall be final and conclusive, subject to the right of referendum of the people. The legislative body may adjourn the hearing from time to time. If no protest in writing is delivered to the clerk up to the hour set for hearing, or such protests as are filed have been heard and determined by the legislative body to be insufficient, or have been overruled or denied, the legislative body may grant the franchise. The franchise shall be granted by ordinance adopted in the manner prescribed by law for the enactment of ordinances by the granting body. 6235. A franchise granted under this chapter does not become effective until the grantee files written acceptance thereof with the clerk of the granting municipality. When so filed the acceptance constitutes a continuing agreement by the grantee that if and when the granting municipality thereafter annexes, or consolidates with, additional territory, all franchises, rights and privileges owned by the grantee therein, except a franchise derived under Section 19 of Article XI of the Constitution as that section existed prior to the amendment thereof adopted October 10, 1911, shall be deemed abandoned http://caselaw.1p.findlaw.com/cacodes/puc/6231-623 5.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6231-6235 Page 5 of 5 within the limits of the additional territory. Previous Return to Top Next ADRWorld.com: ADRWorld.com is your single source on the web for up-to-the-minute news of alternative dispute resolution. Amicus Attorney_: Click Here to receive your FREE evaluation copy version of our practice management software. NEW VERSION Princeton Review: LSAT test prep and more from The Princeton Review-click here! TimeMatters: The most widely used, most award-winning practice management software. Click Here! U.S. Legal Forms, Inc.: *`Over 25000 Legal Forms! *`A unique legal forms site on the Internet providing legal forms to lawyers, businesses and the public. State specific forms in many areas. Abacus Law: Calendar crisis? Never again! Find out how 100,001 users stop it using Abacus Law Practice Control Software. Click here. Com.puLaw: Still Using the Old "Fingers and Toes" Method of Calendaring?There's a Better Way. CLICK HERE. IBM@ Award-winning Thinkpad@ Notebooks: Wireless and Powerful. Work how you want--where you want. Available to you at a 10% discount. LEGAL NEWS: Top Headlines•Supreme Court•Commentary•Crime.Cyberspace.International U$FED_ERAL LAW: Constitut.o.n Codes-Suprem...e..Cou.rt.0_pinions•Circuit Opinions .. US STATE LAW: State Constitutions State Codes•Case Law I jxn RESEARCH: Dictionary-Forms-LawCrawler-Library Summaries of Law LEGAL SUBJECTS: Constitutional-Intellectual Property Criminal-Labor-more... RESOURCES ' GOVERNMENT RESOURCES: US Federal US State Directories more... INTERNATIONAL RESOURCES: Country_Gudes.•Trade. •World Constitutions•more.. COMMUNITY: Message Boards•Newsletters•Greedy Associates Boards TOOLS: Office•Calendar CLE.•Email-West WorkSpace. FirmSite Advertising Info Add URL•Help•Comments Jobs@FindLaw•Site Map Company l Privacy Policy.l Disclaimer Copyright @ 1994-2002 FindLaw http://caselaw.lp.findlaw.com/cacodes/puc/6231-623 5.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6261-6265 Page 1 of 2 FindLaw I Legal Professionals I Students I Business I Public I News E-mail@Justice.com FindLaw IToda for Legal Professionals Click here for more information Go!' Cases&Codes I Forms I Legal Subjects I Federal I State I Library I Boards Law Firm Firm5ites I Le L w er Search JCityorZlP State Select a Practice Area Find i y ��r Search! FindLaw Corporate FindLaw: FindLaw California : Codes and Statutes : California Code : Public Utilities Code Center Click Here!. e California Codes o California Public Utilities Code .. ........ _._..... ■ PUBLIC UTILITIES CODE SECTION 6261-6265 6261. Any franchise granted under this chapter with respect to a Thousands given utility service is in lieu of all other franchises, rights, o privileges owned by the grantee, or by any successor of the grantee Corporate to any rights under the franchise, for transmitting and distributin Counsel the utility service within the limits of the municipality as such limits exist at the time of the granting of the franchise or as the, Attorneys may thereafter exist except any franchise derived under Section 19 Article XI of the Constitution as that section existed prior to the Wrong amendment thereof adopted October 10, 1911. The acceptance of any such franchise granted under this chapter shall operate as an abandonment of all such franchises, rights, and privileges within t limits of such municipality as such limits at any time exist, in lieu of which the franchise is granted under this chapter. FindLaw Newsletters 6262. No franchise granted under this chapter in any way impairs or affects the right of the granting municipality to acquire the r Top Legal property of the grantee by purchase or condemnation, and nothing News Headlines contained in such a franchise shall be construed to contract away, 177 Legal Grounds modify or abridge either for a term or in perpetuity the municipalit ' s right of eminent domain in respect to any public utility. Labor& Employment Law Your email he 6263. No franchise granted under this chapter shall ever be given Subscribe : €.s�. any value before any court or other public authority in any proceeding of any character in excess of the cost to the grantee of More the necessary publication and any other sum paid by it to the Newsletters municipality therefor at the time of acquisition. MY FindLaw 6264 . Every franchise granted pursuant to this chapter, except whehmail: �- a definite term therefor is specified in the ordinance granting it, is indeterminate, that is to say, every such franchise shall endurePassword: � in full force and effect until, with the consent of the Public Keep me logged in Utilities Commission, it is voluntarily surrendered or abandoned by r' until I sign out. its possessor, or until the State or some municipal or public http://caselaw.1p.findlaw.com/cacodes/puc/6261-6265.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6261-6265 Page 2 of 2 corporation purchases by voluntary agreement or condemns and takes - under the power of eminent domain, all property actually used and �!gn �n. useful in the exercise of the franchise and situate within the Forgot Your Password? territorial limits of the State, municipal, or.public corporation click here! purchasing or condemning such property, or until the franchise is New._User_? forfeited for noncompliance with its terms by the possessor thereof. CI1Ck Here! 6265. Every gas franchise granted pursuant to this chapter confers upon the grantee the right to use, or to lay and use, gas pipes and appurtenances for the purpose of transmitting and distributing gas; every oil franchise so granted confers upon the grantee thereof the right to use, or lay and use, oil pipes .and appurtenances for the purpose of transmitting and distributing oil or products thereof; every industrial gas franchise so granted confers upon the grantee the right to use, or lay and use, industrial gas pipelines and appurtenances for the purpose of transmitting and distributing industrial gas; every water franchise so granted confers upon the grantee thereof the right to use, or to lay and use, pipes, ditches, flumes, conduits, and appurtenances for the purpose of transmitting and distributing water; and every electric franchise so granted confers upon the grantee thereof the right to use, or to construct and use, poles, wires or conduits and appurtenances for the purpose of transmitting and distributing electricity for all purposes, under, along, across, or upon the public streets, ways, alleys, and places as they now or hereafter exist within the municipality. Pr..eviou....s Return._to.._...T....op Next ADRWorld.com: ADRWorld.com is your single source on the web for up-to-the-minute news of alternative dispute resolution. Amicus Attorney_: Click Here to receive your FREE evaluation copy version of our practice management software. NEW VERSION Princeton__Review: LSAT test prep and more from The Princeton Review-click here! TimeMatters: The most widely used, most award-winning practice management software. Click Here! U.S. Legal Forms, Inc.: ** Over 25000 Legal Forms! **A unique legal forms site on the Internet providing legal forms to lawyers, businesses and the public. State specific forms in many areas. Abacus..Law: Calendar crisis? Never again! Find out how 100,001 users stop it using Abacus Law Practice Control Software. Click here. CompuLaw: Still Using the Old "Fingers and.Toes" Method of Calendaring?There's a Better Way. CLICK HERE. IBM®._Award..-winn_in.g.Th.inkpad®.Notebooks: Wireless and Powerful. Work how you want--where you want. Available to you at a 10% discount. LEGAL NEWS: Top Headlines•Supreme Court•Commentary•Crime•Cyberspace•International US FEDERAL LAW: Constitution•Codes-Supreme Court Opinions-Circuit Opinions US STATE LAW State Constitutions State Codes•Case Law ndL v RESEARCH: Dictionary-Forms-LawCrawler Library Summaries of Law ■ w REV LEGAL SUBJECTS Constitutional Intellectual Property Criminal Labor more... RESOURCES i>' GOVERNMENT RESOURCES: US Federal.•US State•Directories-more.... INTERNATIONAL_RESOURCES; Country Guides Trade•World Constitutions-more... COMMUNITY: Message Boards•Newsletters•Greedy Associates Boards TOOLS_ Office•Calendar•CLE•Email•West WorkSpace FirmSite Advertising Info•Add URL•Help•Comments Jobs@FindLaw•Site Map Company I Privacy Policy I Disclaimer Copyright©1994-2002 Find Law http://caselaw.1p.findlaw.com/cacodes/puc/6261-6265.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6291-6302 Page 1 of 3 Findl-aw I Legal Professionals I Students I Business I Public I News E-mail@Justice.com FindLaw. Looking for a Lawyer? City or Zip IState Practice Area €= =Se fog Legal Professionals Cases&Codes I Forms I Legal Subjects I Federal I State I Library I Boards Law Firm FirmSites I Le L H► er Search Clty or ZIP . State Select a Practice Area -_ Find ,mom Search) Find Law 1 ... ....I--..... ........ CorporateCounsel FindLaw: FindLaw California : Codes and Statutes : California Code : Public Utilities Code . Center Click Here! . California Codes o California._Public_Utilities_.Code � i�� ■ PUBLIC UTILITIES CODE SECTION 6291-6302 6291. If the grantee of any franchise granted under this chapter fails, neglects or refuses to comply with any of the provisions or � t '�� conditions prescribed in this chapter, and does not within ten (10) flrij � days after written demand for compliance begin the work of compliance, or after such beginning does not prosecute the work wit , due diligence to completion, the municipality, by its legislative body, may declare the franchise forfeited. Find a Job 6292. An municipality may sue in its own name for the forfeiture tee_ i Y P Y Y : Sea reh ' of any franchise granted pursuant to this chapter, in the event of noncompliance with any of the conditions thereof by the grantee, its successors, or assigns. FindLaw Newsletters 6293. The grantee shall pay to the municipality a sum of money sufficient to reimburse it for all publication expenses incurred by F'Topl-egal it in connection with the granting of the franchise. Such payment News Headlines shall be made within thirty (30) days after the municipality r Legal Grounds furnishes the grantee with a written statement of the expenses. r Labor& Employment Law Your email he M 6294 . The grantee of a franchise under this chapter shall SUbscfibe ; construct, install, and maintain all pipes, conduits, poles, wires, and appurtenances in accordance and in conformity with all of the More ordinances and rules adopted by the legislative body of the Newsletters municipality in the exercise of its police powers and not in conflict with the paramount authority of the State, and, as to state highways, subject to the laws relating to the location and MY Find Law maintenance of such facilities therein. Email: Password: �- 6295. The grantee shall pay to the municipality on demand the cost [— Keep me logged in of all repairs to public property made necessary by any of the until I sign out. operations of the grantee under the franchise. http://caselaw.1p.findlaw.com/cacodes/puc/6291-6302.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6291-6302 Page 2 of 3 FSign in' Forgot Your Password? 6296. The grantee shall indemnify and hold harmless the cick_here! municipality and its officers from all liability for damages NCW User_? proximately resulting from any operations under the franchise. Click Here! 6297. The grantee shall remove or relocate without expense to the municipality any facilities installed, used, and maintained under the franchise if and when made necessary by any lawful change of grade, alignment, or width of any public street, way, alley, or place, including the construction of any subway or viaduct, by the municipality. 6298. The grantee shall file with the legislative body of the municipality within thirty (30) days after any sale, transfer, assignment, or lease of the franchise or any part thereof, or any of the rights or privileges granted thereby, written evidence of the transaction certified to by the grantee or its duly authorized officers. 6299. The grantee shall file with the clerk of the municipality, within three (3) months after the expiration of the calendar year, or fractional calendar year, following the date of the granting of the franchise and within three (3) months after the expiration of each calendar year thereafter, a verified statement showing in detail the total gross receipts of the grantee, its successors, or assigns during the preceding calendar year or fractional calendar year from the sale of the utility service for which the franchise was granted. 6300. The grantee shall pay to the municipality within fifteen (15) days after the time for filing its statement of gross receipts, in lawful money of the United States, the specified percentage of its gross receipts for the calendar year or fractional calendar year covered by the statement. Any neglect, omission, or refusal by the grantee to file the verified statement, or to pay the percentage at the ,times or in the manner provided constitutes grounds for the declaration of a forfeiture of the franchise and of all rights thereunder. 6301. (a) The grantee of a franchise under this chapter may be required to file a bond running to the municipality approved by the legislative body, in a penal sum prescribed by the legislative body and set forth in the resolution of intention to grant the franchise, conditioned that the grantee shall well and truly observe, fulfill, and perform each term and condition of the franchise, and that in case of any breach of condition of the bond the amount of the penal sum therein named shall be recoverable. (b) The bond, if required by the legislative body, shall be filed with the legislative body within five days after the date of the http://caselaw.1p.findlaw.com/cacodes/puc/6291-6302.html 10/24/2002 CALIFORNIA PUBLIC UTILITIES CODE SECTION 6291-6302 Page 3 of 3 granting of the franchise. If the bond is not so filed, or does not receive the approval of the legislative body, the franchise may be refused or forfeited and any money paid to the municipality in connection therewith shall be retained by the municipality. 6302. The grantee of a franchise under this chapter shall be liable to the granting municipality for all damages proximately resulting from the failure of the grantee well and faithfully to observe and perform any provision of the franchise and any provision of this chapter. Previous Return to Top Next ADRWorld.com: ADRWorld.com is your single source on the web for up-to-the-minute news of alternative dispute resolution. Amicus Attorney_: Click Here to receive your FREE evaluation copy version of our practice management software. NEW VERSION Princeton Review: LSAT test prep and more from The Princeton Review-click here! TimeMatters: The most widely used, most award-winning practice management software. Click Here! U.S. Legal Forms, Inc.: **Over 25000 Legal Forms! **A unique legal forms site on the Internet providing legal forms to lawyers, businesses and the public. State specific forms in many areas. Abacus Law: Calendar crisis? Never again! Find out how 100,001 users stop it using Abacus Law Practice Control Software. Click here. CompuLaw: Still Using the Old "Fingers and Toes" Method of Calendaring?There's a Better Way. CLICK HERE. IBM@ Award-winning Think ap d® Notebooks: Wireless and Powerful. Work how you want--where you want. Available to you at a 10% discount. LEGAL NEWS_ Top Headlines-Supreme Court•Commentary•Crime•Cyberspace•International US FEDERAL LAW: Constitution•Codes•Supreme Court Opinions•Circuit Opinions US STATE LAW: State Constitutions•State Codes•Case Law RESEARCH: Dictionary.Forms-LawCrawler•Library•Summaries of Law i C1W LE_GAL SUBJECTS: Constitutional Intellectual Property Criminal Labor more... d ro `RESbURGE8 '�`� GOVERNMENT RESOURCES: US Federal-US State•Directories more... INTERNATIONAL RESOURCES: Country Guides•Trade World Constitutions-more... COMMUNITY: Message Boards•Newsletters•Greedy Associates Boards TOOLS: Office•Calendar CLE...•Email•West WorkSpace.•F..irmsite Advertising Info•Add URL•Help•Comments Jobs@FindLaw•Site Map Company I Privacy Policy I Disclaimer Copyright 01994-2002 FindLaw http://caselaw.lp.findlaw.com/cacodes/puc/6291-6302.html 10/24/2002 ATTACHMENT #7 Huntington Beach Municipal Code 3.44—Index Chapter 3.44 PIPELINE FRANCHISES . (2319-10/78,2676-2/84) Sections: I. GENERAL PROVISIONS AND DEFINITIONS 3.44.010 Short title 3.44.020 General provisions 3.44.030 Pole lines 3.44.040 Definitions 3.44.050 Term 3.44.060 Franchise agreement 3.44.070 Nonexclusive franchise 3.44.080 Maps 3.44.090 Insurance 3.44.100 Liability insurance 3.44.110 Workers'compensation insurance 3.44.120 Workers'compensation insurance--Filing 3.44.130 Faithful performance bond 3.44.140 Alternative security 3.44.150 Length 3.44.160 Forfeiture 3.44.170 Value of franchise 3.44.180 State highways 3.44.190 Eminent domain 3.44.200 Publication date 3.44.210 Assignment 3.44.220 Hold harmless 3.44.230 Standards 3.44.240 Defective facilities 3.44.250 Hazardous substances II. COMPENSATION 3.44.260 Basic granting fee 3.44.270 Base annual fee 3.44.280 Base construction charges 3.44.290 Adjustments--Base annual fee 3.44.300 Proration of payments 3.44.310 Records III. CONSTRUCTION 3.44.320 Construction requirements 3.44.330 New installation or replacement 3.44.340 Permits 3.44.350 Work on and restoration of streets 3.44.360 Failure to comply timely 3.44.370 Completion statement 3.44.380 Appurtenances 3.44.390 Ordinary repair 3.44.400 Breaks or leaks 3.44.410 Emergency equipment 2/84 3.44—Index-3.44.040(fl Huntington Beach Municipal Code 3.44.420 Removal or abandonment of facilities 3.44.430 Failure to comply 3.44.440 Abandonment "in place" conditions IV. SPECIAL PROVISIONS FOR OIL PIPELINES 3.44.450 Rights granted 3.44-460 Materials used 3.44.470 Approvals 3.44.480 . Reports 3.44.490 Payments due 3.44.500 Cost of relocation I. GENERAL PROVISIONS AND DEFINITIONS 3.44.010 Short title. This chapter shall be known and cited as "Pipeline Franchise Ordinance." (2319-10/78) 3.44.020 General provisions. Every franchise hereafter granted by the city to lay, construct, maintain, operate,renew,repair, change the size of,remove or abandon in place pipes and pipelines for the collection,transportation or distribution of oil, gas,gasoline,petroleum,wet gas, hydrocarbon substances, together with all manholes,valves,appurtenances and service connections necessary or convenient for the operation of said pipes or pipelines including conduits, cathodic protection devices,wires, cables and other appurtenances necessary or convenient for the exercise of the franchisee's business, in,under, along or across any and all streets within the city of Huntington Beach except as otherwise provided in the particular franchise agreement, shall be granted upon and be subject to the rules,regulations,restrictions and terms and conditions of this chapter, in addition to those rules, regulations, restrictions, terms and provisions set forth in the particular franchise agreement. (2319-10f78) 3.44.030 Pole lines. Nothing in this chapter or in any franchise agreement granting such a franchise shall be construed to permit the grantee to construct new poles or other facilities aboveground. (2319-10178) 3A4.040 Definitions. For the purpose of this chapter,the following terms,phrases,words and their derivations shall have the meaning given herein: (a) "Council" shall mean City Council of the city of Huntington Beach. (b) "Code" shall mean the Huntington Beach Municipal Code. (c) "Department" shall mean the Public Works Department of the city of Huntington Beach. (d) "Director" shall mean the Public Works Director of the city of Huntington Beach. (e) "Franchisee" or"grantee" shall mean the person to whom the franchise is granted,and any person to whom it is lawfully assigned. (f) "Facilities" or"appurtenances" shall mean all property of the franchisee, including but not limited to,pipelines,pump stations,and service connection with the franchisee's facilities, whether installed by the franchisee or not,erected,constructed, laid,operated or maintained in,upon,over,under, along or across any street pursuant to any right or privilege granted by the franchise. 2/84 Huntington Beach Municipal Code 3.44.040(g)-3.44.090 (g) "Franchise payment period" shall mean the time period between the effective date of the franchise agreement granting the franchise and December 31 of the same year,and each calendar year thereafter,during the life of the franchise. (h) "Franchise report period" in all cases shall mean the time period between the effective date of the franchise agreement granting the franchise through and including December 31 of that year,and each calendar year thereafter, during the life of the franchise. (i) "Highway" or"street" shall mean any public highway, freeway(except a state freeway), street,road,alley,lane or court or other public easement,and above and below the same, which now exists or which may hereafter exist in the city of Huntington Beach. (j) "Main" shall mean any pipeline or conduit laid in, along or approximately parallel with any street for the collection,transmission or distribution of any hydrocarbon substances. (k) "Major street" shall mean any street or portion thereof designated as a major secondary highway in the circulation element of the Huntington Beach General Plan. (1) "Minor street" shall mean all streets in the city other than those designated as "major" or "secondary highways" in the circulation element of the Huntington Beach General Plan. (m)"Person" shall mean any individual,person, firm,partnership or corporation. (n) "Section" shall mean a section of the Huntington Beach Municipal Code,unless some other code or statute is mentioned. (o) "Service connection" shall mean the wire,pipes,or conduits connecting the building or place where the service or hydrocarbons supplied by the franchisee is used or delivered, or is made available for use or delivery,with the supply line or supply main in the highway or with such supply line or supply main on private property. (2319-10/78) 3.44.050 Term. Unless the franchise agreement granting the franchise provides otherwise, the term of the franchise shall be twenty-five(25)years. (2319-10/78) 3.44.060 Franchise agreement. The franchisee shall enter into a written agreement with the city of Huntington Beach which grants the franchise and sets forth the terms and provisions therein. (2319-10/78) 3.44.070 Nonexclusive franchise. The granting of the franchise shall not be construed to prevent the city from granting identical or similar franchise to any person other than the franchisee. Nothing herein contained shall ever be construed so as to exempt the franchisee from compliance with all ordinances,rules or regulations of the city now in effect or which may be hereafter adopted which are not inconsistent with the terms of the franchise. (2319-10/78) 3.44.080 Mans. Within ninety(90) days following the date on which any facilities or appurtenances have been laid,removed or abandoned under the franchise,the franchisee shall file a map or maps with the department showing the accurate "as built" location,depth,and size of the facilities or appurtenances so laid,removed or abandoned. (2319-10/78) 3.44.090 Insurance. On or before commencement of any franchise operations, franchisee shall obtain or provide satisfactory evidence of having policies of liability and workers'compensation insurance from companies authorized to transact business in the state of California by the Insurance Commissioner of California. (2319-10/78) 2/84 3.44.100-3.44.120(h) Huntington Beach,Municipal Code 3.44.100 Liability insurance. The policy of liability insurance required by this chapter shall be issued to franchisee and name the city and its officers, agents,and employees as additional insureds. It shall further indemnify for all liability for personal and bodily injury, death and damage to property arising from activities conducted pursuant to the franchise by providing coverage thereof, including but not limited to: (a) Negligent acts or omissions of franchisee and the agents, servants and employees thereof, committed in the conduct of franchise operations. (b) Provide a combined single limit liability insurance in the amount of one million dollars ($1,000,000). (c) Be noncancellable without thirty(30)days written notice thereof directed to Council. (2319-10/78) 3.44.110 Workers' compensation insurance. The policy of workers'compensation insurance, required by this chapter, shall: (a) Have been previously approved as to substance and form by the California Insurance Commissioner. (b) Cover all employees of franchisee who in the course and scope of their employment are to conduct or do work pursuant to the franchise operations. (c) Provide for every benefit and payment presently or hereinafter conferred by Division 4 of the Labor Code of the state of California upon an injured employee,including the vocational rehabilitation and death benefits. (d) Be noncancellable without thirty(30)days written notice thereof directed to Council. (2319-10/78) 3.44.120 Workers' compensation insurance--Filing. Franchisee shall file with the City Clerk prior to commencement of any franchise operations either certified copies of said policies or a certificate of insurance for each of the required policies executed by the company issuing the policy, certifying that the policy is in force and providing the following information: (a) The policy number. (b) The date upon which the policy will become effective and the date upon which it will expire. (c) The names of the insured and any additional insureds. (d) Subject of the insurance. (e) The type of coverage provided by the insurance. (f) Amount of limit of coverage provided by the insurance. (g) A description of all endorsements that form a part of the policy. (h) The insured shall agree to defend, indemnify and hold harmless the city of Huntington Beach against loss,damage or expense by reason of any suits, claims, demands,judgments caused by insured in the performance of the franchise. 2184 Huntington Beach Municipal Code 3.44.120-3.44.200 Any franchise operation shall not commence until franchisee has complied with the aforementioned provisions of this section,and any such operation shall be suspended during any period that franchisee fails to maintain said policies in full force and effect. (2319-10/78) 3.44.130 Faithful performance bond. On or before the effective date of the franchise agreement granting the franchise,franchisee shall file and thereafter at all times during the life of the franchise keep on file with the City Clerk a corporate surety bond approved by the City Attorney running to the city in the penal sum of ten thousand dollars($10,000)with a surety to be approved by the City Attorney, conditioned that franchisee shall well and truly observe, fulfill and perform each condition of the franchise and that in case of any breach of condition of the bond the whole amount of the penal sum shall be deemed to be liquidated damages and shall be recoverable from the principal and sureties of the bond. In the event that said bond,after it has been so filed, shall at any time during the life of the franchise become insufficient, franchisee agrees to renew said bond, subject to the approval of the City Attorney,within ten(10)days after written notice to do so from the Director. (2319-10/78) 3.44.140 Alternative security. In lieu of the bond required pursuant to section 3.44.100,the franchisee may deposit with the Director and assign to the city savings and loan certificates or shares,or both, in the same amount as required on such bond. (2319-10178) 3.44.150 Length. Whenever the length of any wire,pipe or conduit is a factor in calculating any payment due under any franchise granted by the city, all service connections shall be excluded in determining such lengths. (2319-10/78) 3.44.160 Forfeiture. The franchise is granted and shall be held and enjoyed upon each and every condition contained in the franchise agreement, including such conditions contained herein as are incorporated by reference in said franchise agreement, and shall be strictly construed against the grantee. Any neglect,failure or refusal to comply with any of the terms and provisions of the franchise agreement shall constitute grounds for the suspension or forfeiture of the franchise, shall give to the grantee not less than thirty(30)days notice in writing of any default thereunder. If the grantee does not, within the noticed period,begin the work of compliance or after such beginning does not prosecute the work with due diligence to completion,the Council may hold a hearing, at which the grantee shall have the right to appear and be heard, and thereupon the Council may determine whether such conditions are material and essential to the franchise and whether the grantee is in default with respect thereto and may declare the franchise suspended or forfeited. Notice of said hearing shall be given to the grantee by certified mail not less than five(5)days before said hearing. (2319-10/78) 3.44.170 Value of franchise. The grantee of any franchise awarded to a public utility,by accepting the terms and conditions thereof, stipulates and agrees that in any proceeding for the purpose of adjusting the rates of the grantee,no greater value shall be placed upon the franchise than the actual cash paid therefor by the grantee. (2319-10/78) 3.44.180 State highways. _If any street or portion thereof becomes a state highway,except for the right to continue to collect franchise payments in such other rights as by law remain with the city,the state shall succeed to all rights reserved to the city by the franchise. (2319-10/78) 3.44.190 Eminent domain. No franchise granted by the city shall in any way impair or affect the right of the city or any successor in authority to acquire the property of the grantee by purchase or condemnation,and nothing contained in such a franchise shall be construed to contract away,modify or abridge either for a term or in perpetuity the city's right of eminent domain in respect to any public utility. (2319-10/78) 3.44.200 Publication costs. The grantee shall pay to the city within thirty(30) days after receiving a statement therefor, all advertising and publishing costs, including the cost of publishing the granting of the franchise, if necessary. (2319-10/78) 2/84 3.44.210-3.44.250(e) Huntington Beach Municipal Code 3.44.210 Assignment. The grantee shall not sell,transfer, assign or lease the franchise or any part thereof,except with the written approval of the Council. Such sale,transfer,assignment, or lease shall be made only by filing with the Council a copy of the duly executed instrument of such sale,transfer, assignment or lease and a written request for the consent of the Council to such sale,transfer,assignment or lease. If such duly executed instrument and such written request is not filed with the Council before the expiration of thirty(30)days after the effective date of such sale,transfer, assignment or lease,then,upon the expiration of said thirty(30)days, the franchise shall be subject to forfeiture and the Council may,without notice,revoke the franchise. As a condition to the granting of consent to such sale, transfer,assignment or lease, the Council may impose such additional terms and conditions upon the franchisee and upon the" grantee or assignee,which the Council may deem to be in the public interest. Such additional terms and conditions shall be expressed by Council resolution. Nothing herein contained shall be construed to grant to the grantee the right to sell,transfer,assign or lease the franchise,or any part thereof,except in the manner aforesaid. This section applies to any assignment,whether by operation of law,by a voluntary act of the grantee or otherwise. (2319-10/78) 3.44.220 Hold harmless. The grantee shall be responsible to the city and shall defend, indemnify and hold harmless the city and its officers and employees from all damages or liability arising from the use, operation or maintenance of the facilities erected,constructed, laid, operated or maintained thereunder. (2319-10/78) 3.44.230 Standards. All facilities erected, constructed, laid, operated or maintained under the provisions of the franchise shall be erected, constructed, laid, operated or maintained in accordance with and conforming to all the ordinances,codes,rules and regulations now or hereafter adopted by or prescribed by the Council. (2319-10/78) 3.44.240 Defective facilities. If any portion of any street shall be damaged by reason of defective facilities laid or constructed under the franchise,the grantee shall,at its own expense, repair any such defect and put such street in as good condition as it was before such damage was incurred,to the satisfaction of the city. If the grantee,within ten(10)days after receipt of written notice from the city, instructing it to repair such damage, shall fail to commence to comply with such instructions, or,thereafter, shall fail diligently to prosecute such work to completion,then the city immediately may do whatever work is necessary to carry out said instructions at the cost and expense of the grantee,which cost and expense,by the acceptance of the franchise,the grantee agrees to pay upon demand. If such damage constitutes an immediate danger to the public health or safety requiring the immediate repair thereof,the city without notice may repair such damage and the grantee agrees to pay the reasonable cost thereof upon demand. (2319-10/78) 3.44.250 Hazardous substances. Prior to the issuance of any excavation permit for the construction or installation of any pipeline for the transmission of flammable liquids or gases, which are heavier than air,written approval shall be obtained from the Director. Said approval should be based on the determination that no undue fire hazard will be created to life or property in the areas through which the proposed pipeline will be located. To make such determination, consideration shall be given to: (a) Type of hydrocarbon to be transmitted. (b) Density of population or structural development in the area through which the pipeline will be located. (c) Adequacy of water supplies for fire control purposes. (d) Extent of available public fire protection facilities. (e) Number and location of shutoff valves in line. (2319-10/78) 2/84 Huntington Beach Municipal Code 3.44.260-3.44.310 II. COMPENSATION 3.44.260 Basic arantina fee. In the event of an initial grant of franchise or franchises which extend,renew,or continue previously granted franchises,a base granting fee shall be required as established,and amended from time to time,by resolution of the City Council. (2319-10/78, 2676-2/84) 3.44.270 Base annual fee. A base annual fee shall be paid by franchisee at times specified and in the amount established, and amended from time to time,by resolution of the City Council. (2319-10178,2676-2/84) 3.44.280 Base construction charges. The holder of the franchise shall pay at the time of installation,relocation or replacement of any segment of pipe or pipeline, or any other facility covered by the franchise agreement, a base construction charge established,and amended from time to time,by resolution of the City Council. (2319-10/78,2676-2/84) 3.44.290 Adiustments--Base annual fee. The amount of each annual payment of the base annual fee shall be revised every year from the effective date of the franchise agreement at the time of payment, in accordance with the following formula: (a) The "Wholesale'Producer'Price" index(1967=100) "All Commodities," established by the United States Bureau of Labor Statistics,Department of Labor,as it stands on the date the franchise is granted, shall betaken as the"base index"upon which the above franchise fee is computed. (b) If said index for the calendar month ending two(2)months prior to the month in which payment to the city is due shall stand at other than said"base index," then the rate of payment to the city shall vary from said "base annual fee" in direct proportion as said index has increased from the "base index," as hereinabove defined;provided,however,that in no event shall the amount of the annual payment be less than the "base annual fee" as set forth herein. (c) If said bureau shall revise the said index,the parties hereto shall accept the method of revision or conversion recommended by said bureau. (d) If said bureau shall discontinue the preparation of the said index using prices prevailing in the year 1967,as a base of 100 and if no transposition table prepared by said bureau is available,applicable to said year of 1967, then the amount of each annual payment shall be computed by reference to such other price index as may be chosen by city and the city shall be the sole judge of comparability of successive indices. (2319-10/78) 3.44.300 Proration of payments. In the event of abandonment of facilities with the approval of the city as elsewhere in this chapter provided,or in the event of removal of such facilities by the franchisee,or in the event of the grant of a franchise with an initial franchise payment period of less than one year,the annual franchise fee required under section 3.44.390 shall be prorated for the calendar year in which such removal or abandonment or grant occurs as of the end of the calendar month in which removed, abandoned or granted. (2319-10/78) 3.44.310 Records. Franchisee shall keep and preserve for a period of five(5)years subsequent to the date of the most recent franchise fee determination all the records necessary to determine the amount of such franchise fee. At all reasonable times,the franchisee shall permit the city or its duly authorized representative to examine all property of the franchisee erected, constructed, laid,operated or maintained pursuant to the franchise,together with any appurtenant property of the franchisee,and to examine and 2/84 3.44.310-3.44.360 Huntington Beach Municipal Code transcribe any and all books, accounts,papers,maps,and other records kept or maintained by the franchisee or under its control which concern the operations, affairs,transactions,property or financial condition of the franchisee with respect thereto. Said records shall be made available to the city at a location in the county of Orange. (2319-10/78) III. CONSTRUCTION 3.44.320 Construction requirements. Pipelines and appurtenances shall be constructed and maintained in a good workmanlike manner in conformity with the terms and conditions of any city ordinance,rule or regulation now,or as hereafter amended,adopted or prescribed by the city. All pipes laid under the franchise shall be of first class material. (2319-10178) 3.44.330 New installation or replacement. New installations or replacements of.pipelines and appurtenances and all other facilities necessary for the installation,operation,maintenance,and safety of pipelines and conduits shall be laid and maintained only pursuant to permit issued by the department. All such installations or replacements shall be reviewed by the Director as to the most desirable location in the streets of the city and his decision shall be final and binding on the franchisee. (2319-10f78) 3.44.340 Permits. Where the provisions of any city ordinance,resolution or regulation,which shall be in force at that time,require the issuance of an excavation, encroachment or other type of permit,the franchisee shall not commence any excavation or encroachment work under the franchise until it shall have obtained such permit from the department except in cases of emergency affecting public health, safety or welfare or the preservation of life or property, in which case the franchisee shall apply for such permit not later than the next business day. The application of the franchisee for such permit shall show the following facts: the length and proposed location of the pipeline and/or appurtenance intended to be used, and such other facts as the department may require. The franchisee shall pay any and all permit inspection fees to the department. (2319-10/78) 3.44.350 Work on and restoration of streets. The work of constructing, laying,replacing, maintaining,repairing or removing all pipelines and appurtenances authorized under the provisions of this chapter in, over,under, along or across any street shall be conducted with the least possible hindrance to the use of the street for purposes of travel. As soon as such work is completed, all portions of the street which have been excavated or otherwise damaged thereby shall promptly and in a workmanlike manner be repaired,replaced or restored and placed in as good condition as before the commencement of such work and shall be done to the satisfaction of the Director at the expense of the franchisee,and in accordance with the terms and conditions of any city ordinance,resolution or regulation. In the event that the franchisee shall fail or neglect to make such highway repair,replacement or restoration work,ten(10)days after notice therefor has been given franchisee by the Director, the city may repair, replace or restore said highway at the expense of franchisee. Franchisee agrees to pay to the city the cost of performing such work. The amount so chargeable shall be the direct cost of such work plus the current rate of overhead being charged by the city for reimbursable work. (2319-10/78) 3.44.360 Failure to comply timely. In the event that the franchisee fails to complete the work within the time specified in the permit,the city may require the franchisee to pay to the city not more than two hundred dollars($200)per day as liquidated damages for each day construction extends beyond the time specified in the permit. 2/84 Huntington Beach Municipal Code 3.44.360-3.44.420(a) Whenever the franchisee fails to complete any work required by the terms and provisions of the franchise,and the permits issued thereunder,within the time limits required thereby,the city may complete or cause to be completed any and all such work at the expense of the franchisee. The franchisee agrees to pay to the city the cost of performing such work. The amount so chargeable to franchisee shall be the direct cost of such work plus the current rate of overhead being charged by the city for reimbursable work. (2319-10/78) 3.44.370 Completion statement. Upon the completion of the construction of any pipelines or appurtenances constructed pursuant to said franchise, the franchisee shall submit a statement to the Director, identifying the permit or permits issued by the department,the total length of pipeline,the construction of which was authorized under such permit or permits,and the total length of pipeline or appurtenances actually laid. (2319-10/78) 3.44.380 Appurtenances. The franchisee shall have the right to construct,maintain and repair such traps, manholes,conduits,valves, appliances,attachments and appurtenances(hereinafter collectively referred to as "appurtenances")as may be necessary or convenient for the proper maintenance and operation of the pipelines under said franchise,and said appurtenances shall be kept flush with the surface of the street and so located as to conform to any ordinance,resolution or regulation of the city,or of any permit issued by the department in regard thereto and shall not interfere with the use of the street for travel. The franchisee shall have the right subject to such ordinances,resolutions and regulations as are now or may hereafter be in force,to make all necessary excavations in said street for the construction,maintenance and repair of said appurtenances;provided,however, that the franchisee shall first obtain an excavation permit from the department for doing any such work. (2319-10/78) 3.44.390 Ordinary repair. The franchisee shall be privileged to excavate in the road or street for line repair for the number of days agreed upon by the franchisee and the department; provided,however,that the franchisee shall first obtain an excavation permit from the department for the doing of any such work. (2319-10/78) 3.44.400 Breaks or leaks. If any portion of the street shall be damaged by reason of breaks or leaks in any pipe,conduit, or appurtenance constructed or maintained under the franchise,the franchisee thereof shall, at its own expense, immediately following written or oral notification thereof,promptly repair any such damage and put such street in as good condition as it was in before such damage or leak,all to the satisfaction of the department. The franchisee shall obtain an excavation permit from the department for the doing of any such work. (2319-10/78) 3.44.410 Emergency equipment. At all times during the term of this franchise,the franchisee shall maintain or arrange for,on a twenty-four(24)hour a day basis adequate emergency equipment and a properly trained emergency crew within a radius of twenty-five(25)miles from any facilities installed or maintained pursuant hereto for the purpose of shutting off the pressure and the flow of contents of such facilities in the event of an emergency resulting from an earthquake,act of war,civil disturbance,fire,flood, or any other cause or nature whatsoever. (2319-10/78) 3.44.420 Removal or abandonment of facilities. (a) At the expiration,revocation or termination of this franchise or the permanent discontinuance of the use of all or a portion of its facilities,the franchisee shall,within thirty(30)days thereafter make written application to the city for authority either: (1) to abandon all or a portion of such facilities in place; or(2) to remove all or a portion of such facilities. The Director shall determine whether any abandonment or removal which is thereby proposed may be effected without detriment to the public interest and under what conditions such proposed abandonment or removal may be safely effected. He shall then notify the franchisee of his determination. 2/84 3.44.420(b)-3.44.470 Huntington Beach Municipal Code (b) Within thirty(30)days after receipt of such notice,the franchisee shall apply for a permit from the department to abandon or remove the facility. Such permit is to contain the conditions of abandonment or removal as may be prescribed by the Director. The franchisee shall,within ninety(90)days after obtaining such permit commence and diligently prosecute to completion,the work authorized by the permit. (2319-10/78) 3.44.430 Failure to comply. (a) If any facilities to be abandoned "in place" subject to prescribed conditions shall not be abandoned in accordance with all such conditions the Director may make additional appropriate orders, including an order that the franchisee shall remove any or all such facilities. The franchisee shall comply with such additional orders. (b) In the event that the franchisee shall fail to comply with the terms and conditions of abandonment or removal as may be required by this chapter and within such time as may be prescribed by the Director,the city may remove or cause to be removed such facilities at the franchisee's expense. The franchisee shall pay to the city the cost of such work plus the current rate of overhead being charged by the city for reimbursable work. (c) If,at the expiration,revocation or termination of this franchise,or of the permanent discontinuance of the use of all or a portion of its facilities,the franchisee shall,within thirty (30)days thereafter, fail or refuse to make written application for the abovementioned authority,the Director shall make the determination as to whether the facilities shall be abandoned in place or removed. The Director shall then notify the franchisee of his determination. The franchisee shall thereafter comply with the provisions of subsection(b) of section 3.44.420. (2319-10/78) 3.44.440 Abandonment "in place" conditions. Facilities abandoned"in place" shall be subject to the condition that if, at any time after the effective date of the abandonment,the Director determines that the facility may interfere with any public project, franchisee or its successor in interest must remove the facility at its expense when requested to do so by the city or to pay city for the cost of such removal. (2319-10178) TV. SPECIAL PROVISIONS FOR OIL PIPELINES 3.44.450 Riehts granted. The franchisee granted an oil pipeline franchise shall have the right during the life thereof to transport oil, gas,gasoline,petroleum,wet gas and other hydrocarbon substances through the pipelines maintained under the franchise. If the franchisee or assignee later qualifies before the Public Utilities Commission of the state of California as a common carrier, the franchisee or assignee shall then have no right to continue to operate hereunder after the date of such qualification except with the consent of the Council,granted upon such additional terms and conditions as the Council may deem proper. Such additional terms and conditions shall be expressed by resolution. (2319-10/78) 3.44.460 Materials used. All pipelines used or to be used for the transportation of oil, gas, gasoline,petroleum,wet gas and other hydrocarbon substances shall be first class and standard material as set forth by current American Petroleum Institute pipeline specifications. (2319-10178) 3.44.470 Approvals. On all pipelines laid pursuant to the franchise,the Director shall approve where flush-valve connections shall be placed in the line. The availability of adequate water supplies,the hydrocarbons transmitted in the line, and the location of control valves shall be considered when making such determination. Such flush-valve connections shall be installed in the manner prescribed by the Director. (2319-10/78) 2/84 Huntington Beach Municipal Code 3.44.480--3.44.500 3.44.480 Reuorts. The franchisee during the life of the franchise,within sixty(60)days after the expiration of each franchise payment period, shall: (a) File with the Director two copies of a verified report of the franchisee showing for the immediately preceding franchise period, the length of lines in streets,the internal diameter of such lines, the rate per foot per year and the total amount due the city. (b) File with the Director a report in triplicate, showing the permit number of each permit obtained for the installation of new mains during the immediately preceding franchise payment period, together with the length and size of said mains. On this report the franchisee shall show any change in franchise footage since the last franchise payment period segregating such footage as to new mains laid,old mains removed,old mains abandoned in place,and the footage of mains in territory annexed or incorporated since the last franchise payment period. (2319-10/78) 3.44.490 Payments due. Except for pipelines lawfully maintained other than by the authority granted by the franchise,the annual payments shall accrue from the respective dates of installation,whether before or after the effective date of the franchise agreement,and such payments,together with the initial construction charges, if any, shall be due and payable annually. (2319-10/78) 3.44.500 Cost of relocation. Franchisee shall bear the costs of removing and relocating its facilities used and maintained under this franchise if made necessary by any lawful change of grade, alignment or width of any public street,way, alley or place, or for any public project,even if franchisee's facilities are located on a private easement. (2319-10/78) 2/84 y Rice%11 tV`t FOR t�A t L ' YBai i t Al t -;-■ V(\J V�.71 1 �1\'VAI V %a Wiwi 11 IP% (To accompany RCA`s submitted after Deadline t i a A J a t t I A L a C- aL R%- I:L iG/ a I� t� 1'I a 1 � DO da1"U11C1It MU1111111,UdLIVU OUL7jtt"QUUUIGIII Vd111Vll�ld MNdICI %,UlllNdlly b RtlgUU:II. Services/City Attorney/PW ( for Water Franchise 6 I I rnlnru 1ulaaflrSrl I I�ro t t 113ri1/S� I n c 1.re"uea# IPifi�hli L 11/6/02 REASON (Why is this RCA being submitted late?): IThis is a complicated issue and required extensive review by several I 1 Departments, including the City Attorney's office. I EXPLANATION (Why is this RCA necessary to this agenda?): I At the 10/14/02 study session with the City Council,the City Administrator advised that L111.. 11.C111 VVU OU a aV I7Ruu16u IV1 1 I/Y/VL. In addition,there is a threat of litigation on this issue and it is requested that this item be scheduled for 11/6102..AM I CONSEQUENCES (How shall delay of this RCA adverse) impact the City?): I yI � There is a threat of litigation and this item should be scheduled as soon as possible. S I 'I 1 I natu 9 -Approved ® Denied IRoy Silver I City Adm inistrator RCA ROUTING SHEET INITIATING DEPARTMENT: Administrative Services SUBJECT: SOUTHERN CALIFORNIA WATER COMPANY'S REQUEST FOR WATER FRANCHISE TO PROPOSED BOLSA CHICA DEVELOPMENT COUNCIL MEETING DATE: November 6, 2002 __ RCA ATTACHMENTS TA US Ordinance (w/exhibits & legislative draft if applicable) Not Applicable Resolution (w/exhibits & legislative draft if applicable) Not Applicable Tract Map, Location Map and/or other Exhibits Attached Contract/Agreement (w/exhibits if applicable) (Signed in full by the City Attorne Not Applicable Subleases, Third Party Agreements, etc. (Approved as to form by City Attorney) Not Applicable Certificates of Insurance (Approved by the City Attorney) Not Applicable Financial Impact Statement Unbudget, over $5,000 Not Applicable Bonds If applicable Not Applicable Staff Report (If applicable) Not Applicable Commission, Board or Committee Report If applicable) Not Applicable Findings/Conditions for Approval and/or Denial Not Applicable EXPLANATION FOR MISSING ATTACHMENTS .. _. . ......... REVIEWED RETURNED FORWARDED . ._ ......_ Administrative Staff Assistant City Administrator Initial City Administrator Initial p]�o City Clerk EXPLANATION FOR RETURN OF ITEM: (Below • . For Only) G:RCA:02:SoCalWater Fn lion - AWmi�f r ?WA ze%�Sk ��lthni/1✓ Council/Agency Meeting Held: Deferred/Continued to: UApproved ❑ Conditionally Approved ❑ Denied y Clerk's Signature Co nc' M r��Da ee.n yDecembe 1 , 1998 Department ID Number: CD98-59 CITY OF HUNTINGTON BEACH REQUEST FOR ACTION SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS SUBMITTED BY: RAY SILVER, City Administrator PREPARED BY: MELANIE FALLON, Assistant City Administrato ROBERT F. BEARDSLEY, Public Works ;7-/ HOWARD ZELEFSKY, Planning Director SUBJECT: DIRECT STAFF REGARDING PENDING PUC APPLICATION FOR WASTEWATER SERVICE TO THE BOLSA CHICA Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: The City of Huntington Beach has received an application by Southern California Water Company (SCWC) submitted to the Public Utilities Commission (PUC) requesting a certificate of public convenience and necessity to operate and maintain a wastewater system that will provide wastewater service to the residents of the Bolsa Chica Planned Community. Transmitted for your consideration is a request for the City Council to direct the City Attorney to file a protest to the Public Utilities Commission. FundingSource: Not applicable. Recommended Action: A. STAFF RECOMMENDATION: Motion to: 1. "Direct the City Attorney to file a protest objecting to the granting in whole of the authority sought with the Public Utilities Commission to the Application for Wastewater to the Bolsa Chica Planned Community Service (filed November'20, 1998) and that the City Council request an evidentiary hearing." REQUEST FOR ACTION MEETING DATE: December 14, 1998 DEPARTMENT ID NUMBER: CD98-59 Analysis: A. BACKGROUND: In October 1991, Signal Bolsa Corporation had executed a pre-annexation agreement with the Orange County Sanitation District which, among other conditions, agreement allowed .for the necessary increased capacity of the Sanitation District's proposed Slater Pump Station. Hearthside Homes (successors to the original developers) has now determined that the Bolsa Chica Planned Community could be served directly by SCWC which is under the jurisdiction of the PUC. On November 20, 1998, the SCWC filed an application with the PUC for a certificate of public necessity for wastewater, concurrently with the application for water service which was filed under separate cover. The City now has a 30-day window to consider filing: a "protest" or a "response" to the applications. Unfortunately, the deadline for filing either document is December 20, 1998. (PUC Rules 44.1.) PUC Rule 44 defines these two documents as follows. "A protest is a document objecting to the granting in whole or in part of the authority sought in an application . . . [A] response is a document that does not object to the authority sought in an application, but nevertheless presents information that the party tendering the response believes would be useful to the Commission in acting on the application." A protest must include "the facts constituting the grounds for the protest, the effect of the application on the protestant, and the reasons the protestant believes the application, or a part of it, is not justified. If the protest requests an evidentiary hearing, the protest must state the facts the protestant would present at an evidentiary hearing to support its request for whole or partial denial of the application." (PUC Rule 44.2.) A protest is a stronger objection to the application. However, as PUC Rule 44.4 provides, "[t]he filing of a protest does not insure that an evidentiary hearing will be held. The decision whether or not to hold an evidentiary hearing will be based on the content of the protest." Once a protest or response is filed, the PUC will set a "prehearing conference" between the applicant and any parties interested in the application. The parameters of the prehearing conference are set forth in PUC Rule 49. After the prehearing conference, there are opportunities to file motions, request discovery and propose settlement until, eventually, a hearing is held on the application. Various PUC Rules address these actions. CD98-59 -2- December 14, 1998 3:15 PM REQUEST FOR ACTION MEETING DATE: December 14, 1998 DEPARTMENT ID NUMBER: CD98-59 B. STAFF ANALYSIS AND RECOMMENDATION Staff recommends filing a protest because it will provide the City with "interested party" status and will insure the opportunity to meet with PUC staff and the applicant at a pre- conference hearing. The City has already protested the water transmission line, principally to enable the City Council to consider and adopt a policy regarding annexation of the Bolsa Chica area. If the City were to annex, it would be both the water and sewer service provider. Consequently, the City should protest the wastewater application, just as it has protested the water application. Attachment(s): City Clerk's • . . - Number No. Description 1. Application to the Public Utilities Commission by the Southern California Water Company (SCWC) To Operate And Maintain A Wastewater System To The Bolsa Chica Planned Community 2 Proposed Sewer Collection System Facilities Map (Figure 4.1) RCA Author: wln CD98-59 -3- December 14, 1998 3:15 PM RCA ROUTING SHEET - INITIATING DEPARTMENT: Planning Department SUBJECT: Pending PUC application for wastewater service to the Bolsa Chica COUNCIL MEETING DATE: December 14, 1998 RGA ATTACHMENTS STATUS Ordinance (w/exhibits & legislative draft if applicable) Not Applicable Resolution (w/exhibits & legislative draft if applicable) Not Applicable Tract Map, Location Map and/or other Exhibits Not Applicable Contract/Agreement (w/exhibits if applicable) (Signed in full by the City Attorney) Not Applicable Subleases, Third Party Agreements, etc. (Approved as to form by City Attomey) Not Applicable Certificates of Insurance (Approved by the City Attorney) Not Applicable Financial Impact Statement (Unbudget, over $5,000) Not Applicable Bonds (If applicable) Not Applicable Staff Report (If applicable) Not Applicable Commission, Board or Committee Report (If applicable) Not Applicable Findings/Conditions for Approval and/or Denial Not Applicable EXPLANATION FOR MISSING ATTACHMENTS` ... _ . . :REVIEWED RETURNED FORWARDED Administrative Staff ( ) ( ) Assistant City Administrator (Initial) ( ) ( ) City Administrator (Initial) ( ) ( ) City Clerk ( ) __. _. EXPLANATION FOR RETURN OF ITEM :, (Below • . For RCA Author: HZ:SH: :kl rfr bu ' I 4 • i I '•�:�.-i.�.�.. .A- -.�C-Sr ASS.. � r_c r 7 .3-� ��` � -4 � z A E.,,=i �"�� E ,ry: '`� -�.�zr .sip� f�'�,;.`•.�� &, i K.� � -�.r< `3+T�-c.-cis-may FEN, ' � s'=, zj? �`tlut�� � 4 5a 2�s' �t:n �?� = �t z �� � cp�z ,6 ��•'• • MMS ,���•- ��.t� � `-���'s�F � � - �..-t ��� � • • • y"��.c� ���,i^-c�.��^ '" �;� c,�-�` :_���-+- '�' -zT�-�•-s-�35'�``ice x^�`ssa-pC.��',sC Ctb 4�`;�5 L`��c ''tF 'tC•b ��?. -3'-.''�,�:s`_'�`a ;c'�,+�� S� i�'�'•-s't. �3� `�'�ri�s��,_ T�•�fir'�",�e�--tom-:��.'- � i • is i ■ CONFORMED Copy RECEIVED BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA -DEC 0 4 140. DEPARTMENT OF PLANNING In the Matter of the Application of Southern California Water Company (U 133 W)for.a Application No. Certificate of Public Convenience and Necessity pursuant to California Public Utilities Code Section 1001 to Operate and Maintain a Wastewater System to Provide Service to the Bolsa Chica Planned Community. APPLICATION Susan L. Conway, Vice President Southern California Water Company 630 East Foothill Boulevard San Dimas, California 91773 Telephone: (909) 394-3600 Facsimile: (909) 394-7427 November 1998 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA In the Matter of the Application of Southern California Water Company (U 133 W)for a Application No. Certificate of Public Convenience and Necessity pursuant to California Public Utilities Code Section 1001 to Operate and Maintain a Wastewater System to Provide Service to the Bolsa Chica Planned Community. Application to the Public Utilities Commission of the State of California (the "Commission°). I. STATEMENT OF RELIEF SOUGHT By this application, Southern California Water Company ("SCWC") requests a certificate of public convenience and necessity pursuant to Section 1001 of the Public Utilities Code to operate and maintain a wastewater system that will provide wastewater service to the residents of-a new development referred to herein as the Bolsa Chica Planned Community. The Bolsa Chica Planned Community is a residential development to be located in an unincorporated area of Orange County, adjacent to the City of Huntington Beach. The location of the proposed wastewater service area in relation to SCWC's current Orange County District water service tariff area is shown on 1 the map attached hereto as Exhibit A. SCWC proposes to add the new wastewater services to its Orange County District. The property to be served is owned by Signal Landmark, the successor in interest to Signal Bolsa Corporation (the "Developer"). Because the Developer has no other provider of wastewater service, the Developer has asked, and SCWC has agreed to provide wastewater service to the Bolsa Chica Planned Community.' For the reasons shown below, SCWC believes that the provision of wastewater service to this new development is in the public interest. If. BACKGROUND A. The Orange County District SCWC's Orange County District is comprised of two customer service areas — the Los Alamitos CSA and the Placentia CSA -- and four water systems that serve separate areas: the West Orange County System, the Placentia System, the Yorba Linda System, and the Cowan Heights/Lemon Heights System. The West Orange County System, which is shown -on Exhibit A, serves the Cities of Cypress, Los Alamitos, and Stanton, small portions of the Cities of Buena Park, Garden Grove, La 1 The Developer has also asked SCWC to provide water service to the Bolsa Chica Planned Development. Accordingly, SCWC filed with the Commission on October 23, 1998, its Application No. A.98-11-003 pursuant to Section 1001 for permission to extend its Orange County District service territory and provide water service to this new development. SCWC respectfully requests that these two Applications be consolidated for all purposes. 2 Palma, and Seal Beach, and an adjacent unincorporated area of Orange County, which includes the community of Rossmoor. SCWC currently does not provide wastewater service within its Orange County District. As of December 1997, there were 40,118 active water service customers in the Orange County District, of which 98% are in the commercial classification consisting of residential and business customers. Approximately 25,526 customers are within the Los Alamitos CSA. SCWC estimates that the Orange County District will grow at an annual rate of about 280 customers per year. The Los Alamitos CSA office is located at 10852 Cherry Street in Los Alamitos. Requests for turn-on or close, billing inquiries, collection activities, leak reports, meter reading, conservation and public relations-related activities and other local matters are coordinated out of this office. Field operations for the Los Alamitos CSA are coordinated out of the Los Alamitos Field Operations Warehouse, located at 11082-A Winners Circle in Los Alamitos. Field.operations. include repairing main, hydrant and service leaks, new service installations, gate valve and hydrant maintenance programs, and 24 hour emergency response. 3 B. The Bolsa Chica Planned Community The Bolsa Chica Planned Community encompasses approximately 1,588 acres within unincorporated Orange County, as shown on Exhibit A. The Bolsa Chica Planned Community is coterminous with the County's Bolsa Chica Local Coastal Program Area. The portion of the Bolsa Chica Planned Community to be developed for residential purposes and which SCWC seeks to serve is the northerly subarea referred to as the Bolsa Chica Mesa, which encompasses approximately 230 acres. The Bolsa Chica Planned Community is surrounded by residential neighborhoods to the north, east and southeast in the City of Huntington Beach, and by the Pacific Coast Highway .and the Pacific Ocean to the southwest. A variety of community benefits will result from the Planned Community, including a new elementary school that is needed to meet existing and future demands, a 17-acre community park that will provide panoramic views of the Bolsa Chica wetlands and the Pacific Ocean, five miles of hiking and biking trails, the development of a child-care facility, an..ecological interpretative center to be constructed within Harriet Wieder Regional Park, and the dedication of approximately 49 acres of open space within Wieder Park. The total number of lots to be developed is approximately 1,235. Construction is expected to begin in 1999. The square foot area of the smallest lots is 3,000 and of the largest lots is 6,000. The average square footage of all lots is 4,700. The development 4 will consist primarily of single family detached homes. A limited number of townhomes will be built. Homes will be constructed by merchant homebuilders and sold to the public. No custom lot sales or apartment units are planned for the development. 111. THE WASTEWATER SYSTEM A. Description The Bolsa Chica Planned Community is surrounded by District 11 of the County Sanitation District of Orange County (the "Sanitation District°). Annexation into the Sanitation District will be required in order for the Bolsa Chica Planned Community to receive service for the collection and. disposal of its sewage. A pre-annexation agreement has already been executed between the Developer and the Sanitation District, attached hereto as Exhibit C. The Sanitation District is currently improving its collection and distribution facilities by upgrading key sewer lines and pump stations downstream of the development. These improvements were financed in part from funds, advanced by the Bolsa Chica developer in accordance with the annexation agreement. The flow from the Bolsa Chica Planned Community will ultimately move through the Sanitation District's Slater Avenue Pump Station and sewer system. Wastewater will be treated at Plant 2 in Huntington Beach. 5 The Developer will be responsible for building the on-site sewage collection system. The facilities that the Developer will construct to serve the Bolsa Chica Planned Community are described in detail in Section 4 of the Plan of Works Report for Water and Wastewater ("PWR"), a copy of which is filed concurrently to SCWC's companion Application No. A.98-11-003 to provide water service to the new development (the "Water Application") and is incorporated herein by reference. The on-site sewage collection system is shown in Figure 4.1 of the PWR and includes sewage lift stations and force mains required to connect to the Sanitation District facilities. Specifically, all sewage from within the Bolsa Chica Planned Community will be collected in local sewer lines and is expected to flow by gravity to the Warner Avenue Lift Station. The Warner Avenue Lift Station will be constructed to lift sewage from the residential development to the Los Patos Trunk sewer, via a force main. The Los Patos Trunk sewer is located at the intersection of Los Patos Avenue and Bolsa Chica Street. The PWR also describes the wastewater system design criteria, flow characteristics, operating parameters, and facility sizing calculations for pumping 2 Several of the documents referred to in this Application are voluminous and are already on file with the Commission as exhibits to SCWC's companion Water Application, filed on October 23, 1998. Rather than duplicate those voluminous exhibits, and because SCWC requests that these two Applications be consolidated for all purposes, SCWC is incorporating such documents herein by reference. SCWC will provide another set of such exhibits at the Commission's request. 6 requirements and pipeline diameters. The PWR also discusses emergency standby power for the lift station. Section 4 of the PWR includes exhibits showing all of the proposed wastewater system facilities as they relate to the proposed development plan. All off-site facilities, including gravity wastewater lines constructed in Warner Avenue, the Warner Avenue Lift Station, and the Los Patos force main, are to be designed and constructed by the Developer but will be owned and operated by the Sanitation District. The remainder of the wastewater facilities will be financed by the Developer, but contributed to SCWC without reimbursement. SCWC will operate and maintain the on-site wastewater facilities. B. The Need For A Wastewater Provider The Project site is not currently located within the jurisdictional boundaries of a local wastewater management agency. The areas surrounding the Project site are served by the Sanitation District. As stated above, annexation into the Sanitation District will be required in-order for the Bolsa Chica Planned Community to receive service for the collection and disposal of its sewage. Accordingly, the Developer has requested, and SCWC has agreed to provide wastewater service to the Bolsa Chica Planned Community. A copy of the March 12, 1997 System Operation and Maintenance Agreement (°1997 Service Agreement") 7 between SCWC and the Developer is attached as Exhibit B to SCWC's companion Water Application No. A.98-11-003.' Pursuant,to the 1997 Service.Agreement, SCWC will be responsible for the continued operation and maintenance of the proposed wastewater system. Pending all permits and approvals, construction of the wastewater system will commence in 1999. C. Cost Estimated costs for the wastewater facilities are provided in Section 6 of the PWR. As stated above, all wastewater facilities necessary to serve the Bolsa Chita Planned Community — both on-site and off-site -- will be privately funded by the Developer. SCWC.will classify the on-site wastewater facilities as contributed plant. There is no intent to recapture the cost of these facilities through the wastewater rates charged to customers, either within or outside SCWC's Orange County District. D. Rates To Be Charcied The new customers in the. Boise Chica Planned Community will be charged a minimum of $6.00 per month, or $0.267 per one hundred cubic feet of water used, whichever is greater. SCWC's proposed wastewater tariff is attached hereto as Exhibit B. 8 IV. ENVIRONMENTAL REVIEW UNDER CEQA The environmental review of the Bolsa Chica Planned Community is complete and final. Filed concurrently with the companion Water Application No. A.98-11-003 is a copy of the 1996 Recirculated Draft Environmental Impact Report for the Bolsa Chica Local Coastal Program, County of Orange, County Project Number 551 (the "Program EIR"), which includes the environmental assessment of the Bolsa Chica Planned Community. The Program EIR was certified in June 1996 by the County of Orange, the lead agency for the Project, and following appellate review, is now final. A copy of the County's Resolution certifying the final Program EIR is attached as Exhibit E to the companion Water Application. The Program EIR analyzed in detail the on-site wastewater facilities to be constructed within the Bolsa Chica Planned Community. The County of Orange certified that no significant short-term or long-term impacts have been identified for wastewater service, as proposed in the Program EIR. V. JUSTIFICATION Under Section 1001, SCWC must show a need for its service, and that it has the resources, technical competence and financial viability to serve the Bolsa Chica Planned Community now and in the future. SCWC satisfies each of those criteria. 9 First, no other wastewater provider is ready, willing and able to provide wastewater service to the new development. The Bolsa Chica Planned Community needs wastewater service, and SCWC is willing to fulfill that need by operating and maintaining the system. Second, SCWC has sufficient resources, technical competence and financial viability to serve this new development. Moreover, the rate SCWC proposes to charge is fair and reasonable. The Developer will pay all costs associated with construction and installation of the wastewater facilities required to serve the Bolsa Chica Planned Community, and will contribute these facilities to SCWC. SCWC's proposed rate is based, therefore, on the projected costs to operate and maintain the system. Further, no significant environmental impacts or detrimental effects to the community or existing recreational and park areas are expected to occur as a result of wastewater service to the Bolsa Chica Planned Community. Rather, a variety of community benefits will result from the new development. Accordingly, SCWC respectfully submits that. the public convenience and necessity are served by SCWC's provision of wastewater service to the Bolsa Chica Planned Community. 10 VI. FORMAL MATTERS AND PROCEDURAL REQUIREMENTS This Application is brought pursuant to Section 1001 of the Public Utilities Code. SCWC proposes that this Application be categorized as a ratesetting proceeding. The need for a hearing, the issues to be considered, and a proposed schedule can better be determined at a first prehearing conference, following the filing of protests, if any. Given the Developer's need to begin construction of the wastewater facilities as soon as possible, SCWC respectfully requests that review of this Application be expedited. SCWC's legal name is Southern California Water Company, and its principal Place of business is located at 630 East Foothill Boulevard, San Dimas, California, 91773. SCWC's main telephone number is (909) 394-3600. The name, address, and telephone number of the person to whom communications regarding this Application should be addressed is: Susan Conway, Vice President- Regulatory Affairs Southern California Water Company 630 East Foothill Boulevard P.O. Box 9016 San Dimas, California 91773 (909) 394-3600 SCWC is a corporation duly organized and existing under and by virtue of the laws of the State of California and represents the consolidation, effective on 11 December 31, 1929 upon the order of this Commission, of some twenty corporations which were formerly operated under the jurisdiction of this Commission as public utilities, together with subsequent acquisitions and additions. Its principal business is the production and distribution of water for domestic, industrial, municipal and other purposes. SCWC renders water service in various areas in the counties of Contra Costa, Imperial, Lake, Los Angeles, Orange, Sacramento, San Bernardino, San Luis Obispo, Santa Barbara and Ventura, and electric service in the vicinity of Big Bear Lake in San Bernardino County. A copy of SCWC's Restated Articles of Incorporation were filed with this Commission on July 10, 1996 as an exhibit to Application No. 96-07-015. SCWC's latest available Results of Operations for the Company overall, and for the Orange County District are attached as Exhibit F to the companion Water Application No. A.98-11-003. SCWC's most recent available Balance Sheet and Income Statement are attached as Exhibit G to the companion Water Application. No transactions requiring the reporting of a material financial interest, as defined in General Order No. 104 A, has occurred since the last Annual Report filed by SCWC, 12 and except as reported therein, SCWC does not propose at present to become party to any transaction requiring a report of such material financial interest. A copy of this Application will be furnished to the City of Huntington Beach, the City of Seal Beach, the City of Westminster, the Local Agency Formation Commission, the County Sanitation District of Orange County, and the Board of Supervisors of the County of Orange. VII. PRAYER WHEREFORE, Southern California Water Company respectfully requests that the Commission issue an order: 1. FINDING that the public convenience and necessity requires the provision of wastewater service to the Bolsa Chica Planned Community by SCWC; 2. AUTHORIZING SCWC to file a tariff map to reflect the provision of wastewater service to the Bolsa Chica Planned Community; 3. AUTHORIZING SCWC to charge such rates and tariffs in the Bolsa Chica Planned Community for wastewater service as are requested herein; 13 4. GRANTING such other relief as the Commission deems reasonable and necessary. Dated: November , 1998 Susan L. Conway, Vice President SOUTHERN CALIFORNIA WATER COMPANY 14 VERIFICATION With respect to the within Application, the undersigned certifies that she holds the position indicated below her name, that she is authorized to make this verification for and on behalf of said entity, that she has read the Application and knows the contents thereof, and that the same is true of her own knowledge and belief, except as to those matters which are therein stated upon her information or belief, and as to those matters, she believes them to be true. The undersigned declares under penalty of perjury that the foregoing is true and correct. Executed on November , 1998, in the City of San Dimas, California. By— Susan L. Conway Vice President, Regulatory Affairs SOUTHERN CALIFORNIA WATER COMPANY CERTIFICATE OF SERVICE hereby certify that, pursuant to the Commission's Rules of.Practice and Procedure, have this day served a true copy of Southern California Water Company's Application on all parties identified on the attached service list. Service was effected by placing the copies of properly addressed sealed envelopes and depositing such envelopes in the United States mail with first-class postage prepaid. -- Dated November 1998. Lanell N. Copeland SOUTHERN CALIFORNIA WATER COMPANY SERVICE LIST ORANGE COUNTY DISTRICT City of Anaheim City of Santa Ana Water Public Utilities Dept. 20 Civic Center Plaza 201 So. Anaheim Blvd. Santa Ana, CA 92702 Anaheim, CA 92805 City of Seal Beach Brea Water Department 211 Eight Street City of Brea Seal Beach, CA 90740 #1 Civic Center Drive Brea,.CA 92621 City of Tustin Water 300 Centennial Way City of Anaheim Tustin, CA 92680 P.O. Box 3222 Anaheim, CA 92803 City of Westminster 8200 Westminster Boulevard City of Buena Park Westminster, CA 92683 6650 Beach Boulevard Buena Park, CA 90620 East Orange County Water 185 N. McPherson Road City of Garden Grove Orange, CA 92669 13802 Newhope Street Garden Grove, CA 92643 Fullerton Water Department City of Fullerton Water 303 W. Commonwealth Avenue City of La Palma Fullerton, CA 92631 7822 Walker Street La Palma, CA 90623 Serrano Water Dist. Villa Park 18021 East Lincoln City of Orange Water Dept. Villa Park, CA 92667 189 South Water Orange, CA.92866 Yorba Linda Water District 4622 Plumosa Avenue Yorba Linda, CA 92686 SOUTHERN CALIFORNIA WATER COMPANY SERVICE LIST ORANGE COUNTY DISTRICT To the City Attorney and City Clerk of. City of Placentia City of Cypress 401 East Chapman Avenue 5275 Orange Placentia, CA 92670 Cypress, CA 90630 City of Seal Beach City of La Palma 211 8th Street 7822 Walker Seal Beach, CA.90740 La Palma, CA 90680 City of Stanton City of Los Alamitos 7800 Katella Avenue 3191 Katella Avenue Stanton, CA 90680 Los Alamitos, CA 90720 City of Yorba Linda City of Orange 4845 Casa Loma Avenue 300 E. Chapman Avenue Yorba Linda, CA 92686 Orange, CA 92666 To the County Counsel and to the County Clerk of. County of Orange County of Los Angeles 10 Civic Center Plaza 12400 East Imperial Highway Santa Ana, CA 92702 Norwalk, CA 90650 - Herschel T. Elkins, Asst. Attorney General State of California 300 South Spring Street Los Angeles, CA 90013 Mr. C. Ronald Hicks, Manager Regents of the Univ. of CA Facilities, Design, Construction and Management 300 Lakeside Drive, Room 1251 Oakland, California 94612 California Dept. of General Services Office of Buildings and Grounds 1304 "O" Street, Suite 300 Sacramento, CA 95814 SERVICE LIST City of Huntington Beach 2000 Main Street - Huntington Beach, CA 92648 City of Seal Beach 211 8th Street Seal Beach, CA 90740 Ci", of Westminster 8200 Westminster Blvd. Westminster! CA 92683 Local Agency Formation Commission 12 Civic Center Plaza Santa Ana, CA 92701 Board of Supervisors of the County of Orange 10 Civic Center Plaza Santa Ana, CA 92701 County Sanitation Districts of Orange County Administration Building P.O. Box 8127 Fountain Vallee, CA 92728-8127 SOUTHERM CALIFORNIA WATER COMPANY . Revised 2703-WCa1- P.U.C. �3��r IUD 3625 WEST SIXTH STREET a�� - 1 Revised LOS ANGELES, CALIFORNIA 90020 Cancelling e v j,ed. Cal. A.U.C. SheEt Ala. _ ORANGE CO[TNTY DISTRICT MI <,_,W I P - •r....asi=s � $ a � 'y ':F. _ _ , ; ..,r - - - _. � �.�• - srEtl .! .� ;t��=- {Test Oranae Svstem �IInM - r ctNr:.°.r%gJ. =,_,�B �•' _gam 1 6 �G•O •.q.. - - �`i• y_ t� 4+eG..w•t .Smv� •r.�rtL'i, r ,. :RY o= = c. 4ra...,., ii. CARBON— -ov a 'ST iii' t - _-_ _ __ g =6 _ _ 1 ,<,I;u -"'a LNt.U�I�l r�L`'.. J sso, -__6 19 - I - �.. , V FT e - p•' 1 _ tlo - I 8 v •`�iY 31FE`_ •a,0� a 2j9r•• T -I _I el' ' iy ` 7 ;,UAIP mmartL -S _ b % „�tar •+roll ._ [p�{Jt��.1A���g7 - <+. . AA_Ir:�, �yq��� - J 5 nl �,^� Q - ,O,n _ t T^.a.".•+r_ /• •a�,iF-�=; - - -'�i' /.Yr�j 1r 411 F� � sea- i C'. ry=1 _I•M -�i"'_^<�-•'L�.=''--_G n. r 5 1cv . Indicates Existing i. it •�•I. - s Ps ..�. _ = wi - - - - Service Area \ 'y W '. -rn•.o•t•se•Iwn• - ... '• �..:s-1'+..... _. .*J- .IxI;T �"� i 617E aam-",,. _�]uYDn-�- - - \ a I 7 71 R•.7aa• '•'sy'Q°"'..'•_rc-. ii 31mma .r...AaRfr.,.. S �t .,rt_, �' act �_'7urrOc __i ^ •iltaoi - •tt:_ -{ E1=.• :-i,-` '-+%a c .sax a- r' __ _•RaU:n� 0c^ i zz••-• :r 4 °•a. `.�•I 1 1 I� „'7r s'— �t:;' u•• J aax .s ` •_t' g Indicates Service gv.c-au: _ 1 w, _i= •a ,K •yeo'e.<ta•n _ sr� `w�'aa_; _ C; ORANGE" n = :ro' �,::. • I ail$1�•� C,rx..� tr �/== • Oaa =�1 .OSY;.. •o-• as _ •c:a-.'c: on"GE's Y' 1flOa - two ly 4V ,,�• .aau.M1•• n4 zw. 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' _ 1 18 _ R - vy f/QIpNpO 4Yf to ca _ ,i f' 3t± Ir5 /F '" 3."•"(i -'r' _ _ e - _ x -9R'a r INIF 4•^:3 _ ;t 1 �Pri(o puar f _ j 1 - 1' _ \ _ - - mat 8 - 1 �w lrr.j1 N fan':� •r�CIT/uC' �•' as _con''Ja• - �•J 3«I •iI-]c ` r pn .. _�� -.�• -_ - :Mma<' - ':r. ___- -� `• - = - "'r xW 3Y• y �S s.. _ - `- \�-Rf`_I�'�•/j] d �Wool ff� - twn , :yy: a31 - e• .r +.r � ,...$ - } -� ,Yl. •• 'E h loot rlolaa l.tolp(ise' �• qJ_ Jf=ooIN T`�g . r_o."ar' tna or �•��6 .f PLAZA .—,Lao .slu.raaafrt ri a� wrY,� -__�'�•- ..�"O..iP! _tC AjTka,E�L[L�-„•Ar---3;KA V z al:ayMao. G) v!q r'i^-Q+,• irro a_E`37` 3t_=-- fsr".'fr�...G��A.' �I°1Bi)'C'�n E'q•U-;�Si - •sJ _ - aIIl �.. : a1Q R i A CN _ " •.IO,M. Sa1M"[ � OIL7IaI•�:�1•CM :N ...:.,- it� �Y g i _ � �•� � _ [:.N� _ ..- um a as .F AV t ]. W _ = ._ _ _! a •. �% d s' a0 :.tom O a npria0_aI Truatr - .. ., _ _ _ - iY , •%�-' _ .4-�' - - '.,+:✓, I tf. •- _ r� o . a /�p0u11 ... - :+:.s+a_ ?A .... „ ^ fun.am i is ..Lv..o. ';`.Y•s,*. I +�•i-z wf'te �iY...a _ _ i___ • _ �. •!� « _sue'.t7irll�r:r�_� '1�L_ S� �n `' .. nes".-r.-,A'ir�r� x a Y � � •. -,.,m., ' Nej. -. •J.�;_ '- , rJ �/L twi�alAq¢ �i OAK.-, t M;v :.• ; 1 m¢f>j 3 �1� - ( - _ _ -��' C�•a.wgas• rn�:.+un �CCN' --:3 < �•�L�♦.1 I agaiR6 a0 _ �N • W _- i ! ,• ' --•"._ 3 _ ...�.• :>+ fn � 011.riER000 . ;�'d._CILO• MGROW= r �'•r'Rr m1 JSLA lsstrfxa :eri _-_ __ __- _- - - I - ;'T '-t.:•. , :� _ ".1•- - li'�t•.tl n.•.ar_•• - .'>t` 1 - I�Ij� • a ' r •.a�•�� i - .'wsn'P^+. _ - -�_r._._1-1__--;,:/_'. .i_ ///'''/� y4 �u�•• - 'I �!:- ... .a.•r� �•`-�' s%�--_r_`-i p: - C _ t ¢ fT ntrtll (�0[I ORAL _3. _ ;:3 '--;+._a �' �flRla•J,W£ •I.u: -JV� / 1 �• _ � .� �jir Y ._� .d ` -.�pNl.'•9'•..i�_ iUGl/aTa t1N - �' RTfsf 09 /--_ ' ��a._ J:-� ,,-•„ r _ �;l—• �� .� rf��>� SHOWING TERRITORY WITHIN WHICH DULY - �•C 6 ^1C Oa 1 .r 5•+r•.rrw_ i�;,,1= :M -L t+xr•.4•r•q=lr,•• v 1. �--� � '. rI`' ANAMA*vJIM"CfiVrV �I r y � 1+It�� i ��1=I`I+:B -�^ _ r.ar t+��a' ESTABLISHED AND REGULARLY FII c TARIFF Ib11 ♦ wa -t •ro6 t ij w:Jlrgp(yJ s .r a N�,-'' .,1----r.• ! ' mow'... ••�d1sN�,,/ D tl:'.t1�' a mid: GIN r..�•r'1 .- I' - . m•`~:..rr..rr rtar yuV_;w'oL 1...: l._.�'-ram::a_ _ =-•R .c.ur"'7d-.. _ 777 CHAPh1CN ':m'y ^ SCHEDULES APPLICABLE TO WATER SERVICE' «ran �' '•---�J �'-' � •' � _:nl�•rcw •-wraoll rIr' 31e) is - \ _ •_y.6 _ .... —I b: AR IN EFFECT. r aa.l.rr••:, s Y aCtT'R ?.Ja�"r 3 m o a1 ---- �t �r3 ?I71�J�1�311 �a .�z `~ o: -I OR u g' ..•+, a: �•rrT.�L"t �t -•,'_r.v;� -+ae•?•-t �7,�`�•„-�"- AYE :�- s.., -. - r gig-]R sii A - - >' - - -' ;nr.r• _ -_"`- �7P, r r_ _ .._aa..1 . i0'Ea LN �'3 _:4eQR'•S / r.4MG-iti-_.' 111_L;�`', ;rlaa�' I t •:<.- zQ" „y C � [+ _ auME sa.Kw`002 rma- .'P 3 _ n - This map shall n ��•, � •—�++aKe Y•R T-- r--' `• :� `+N�''��Yr,Gs - J..:`' _ z 51 r•�ex•• `_•ry - P or be considered by the Public RG P _ 1. '� 'F�tc..rat -� ta.,• :v _ —:!1 _, -��:TY _ ,nIT• r' Q•_t- m E 0.� f o ri ,: _ r 002 F , t- O *•a - _ _ Utflit, Commission f 'rh talc o! o u � �• ew t ____ -__ -_ _i •% Y1^ .�—� :uP< _ :IcaoILAMPSON Cdr..�-s _ cs Comml o o e Caliiorm or any other public y or n I :Esl _ _ i,_. ✓° •:!1;• F.YCPE x:.:•-,-1•• .: 3 •� tii n�_.._.ti__.- •.;'um•� .- IC be oli a Iina1 CO C u- �•"o\* •�5�.•E`=e t: v - iw �.cf�-','�J-i:_'_ - aIMES:[ .ms ra.+rr..:,� _ _ - -__. %1: _ -- �1. y `. srve derermtnatlon or establishment of the dadi- .y _ _ _ - - � _ ::1. axaa u:J - ratan•d - Io-.?; - - -, T. �_R�a _I _ __ ;L . w �—?" toted area of scrYlce, or any portion thereof. \. �.- ! `.•goo.. _.... -1 - p, ._ pal•( .to i.sf.Gail(aw/• ..lam .�'--.ai._ _ �I c :�\J>\-r r. ,.•.�_^"1 °ai'w w, _ _I•••• -- - :p• - -- •1K. ,:[` im !i,.f W:- W" 0 O. ``,fie —^f+: _ _y_. ••�Tr+ v _ �I_• .j 3I-I cl i7 _ 3__s_-_. t- •�--r+xt�.'.• ':iaCY1 _In' ..a•o-,Y i :Z*,' :y rr - ca - - L_:^_ �." ..1 _I:.I`<i`a:lf^c ._�1 4•jl � �_'r"-_":__ r - - .S. ,t•� -1= it a,:�a:�J tl? '1-'--~ -' - - - _ �_Knr�- .i' - . _ ��:F!q. - \' _• � .•1 - - .• --__ mac•="�=_----_-�._ _ w_. r_._____ __ _ _...r. - - :I'_ SA - ;em N OIEGO FRWY .rI \�r,,� ; =' �( ,: �1Ls� (T o be Inaw"d by U9111tq) o be In0co"Od b; Cei- P.U.C.) dVICC Lgtte 140. 676-"W s acr.� f Date File ^a�_-ff /a.••�� E fectwe ��SafL t;^n .6 SOUTHERN CALIFORNIA WATER COMPANY Revised Cal. P.U.C. Sheet No. 630 E. FOOTHILL BLVD. P. O. BOX 9016 SAN DIMAS, CALIFORNIA 91773-9016 Cancelling Revised Cal. P.U.C. Sheet No. 1� a y vLM121rti — - ---- TWIN TRIE LM � '•; 5200 a J� Trar i~i, TIARA OR5001 [L C1% � DN I LL 3;, s JAMES �v T - Lk sTE� C I R KI suAlac DR r OR ON cia 1 _ N C1R = ALADOIK - �,. nv C1R J i� a GLEN FS + �15 s=�MFMR AVr "Ic U oa a W a, Era H 8 —`` - a° C1R1 TORT W KENILW �' u, OR Ov 1415 BaLsA CMr \ r ��. t IS TA Tr Area to be'added BEACH ISSUED BY Date Filed Advice Letter No. F.E. WICKS Effective Date Decision No. President Resolution No. Proposed Rates Schedule No. BCS-1 Orange County District APPLICABILITY Applicable to all wastewater services. TERRITORY All or portions of the Bolsa Chica Planned Community. RATES Proposed Rates Per Month Minimum Charge ......................................... $6.00 For all water used, Per 100 cubic feet ......................................... $0.267 These fees are imposed to provide the wastewater service to properties within the Bolsa Chica Planned Community. SOUTHERN CALIFORNIA WATER COMPANY Bolsa Chica Planned Community Wastewater Tariff Rates Design Cost of Service Cost Cleaning of mains 13,590' of main, cleaned annually at$.020Af $2,718 Pipe replacement and maintenance (at$931,000 at 50 years) $18,820 SCWC district labor cost (300 mhrs/yr @$40.00) $12,000 SCWC CSC labor cost (billing) ($0.35/Cust/bi-monthly billing ) $1,296 Sub-total » $34,834 SCWC Overhead (25%) $8,708 Total Cost » $43,542 Wastewater Charge Calculation Assumptions Number of fully developed dwelling units 1,235 Build out percentage 50% Build out units 617 Monthly Minimum Charge Calculation Total Cost $43,542 Monthly Minimum charge F $6.00 Wastewater Charge per Ccf Average usage per customer(Ccf) 22 Annual Usage (Ccf) 162,888 Total Cost 43,542 Charge per Ccf $0.267 COUNTY SANITATION DISTRICTS OF ORANGE COUNTY, CALIFORNIA P.O. BOX 8127.FOUNTAIN VALLEY.CALIFORNIA 92728-8127 10844 ELLIS, FOUNTAIN VALLEY. CALIFORNIA 92708-7018 'tM.Itt� cou"� (714)962-2411 November 14, 1991 Signal Bolsa Corporation c/o The Koll Company 4343 Von Karman Avenue Newport Beach, CA 92660 Attention: Lucetta Dunn Subject: Sewer Service Agreement re funding and construction of master-planned sewerage facilities to serve the Bolsa Chica area, providing for prepayment of annexation fees for proposed Annexation No. 19 to District No. 11 and guaranteeing sewer service for development of a portion of the Bolsa Chica property The Board of Directors of County Sanitation District No. 11 , at its regular meeting on November 13 , 1991 , approved subject.- agreement. We are transmitting herewith one fully-executed copy of said agreement for your records. When this document is recorded, please provide the recording information to the undersigned. Please note that EXHIBIT D to said agreement provides that Signal Bolsa Corporation pay $250,000 to District No. 11 within 30 days from the date said Sewer Service Agreement is executed. Accordingly, the District will expect this portion of the advance payment of annexation fees no later than .December 13, 1991. Rita J. Brown Board Secretary rj b Enclosure cc: Daniel K. Winton - Paone, Callahan, McHolm & Winton (w/enc. ) Thomas L. Woodruff (w/enc. ) Thomas M. Dawes (w/enc. ) RECORDING REQUESTED BY, AND WHEN RECORDED, RETURN TO: Paone, Callahan, McHolm & Winton -� 19100 Von Karman, Sth Floor _ Irvine, California 92715 Attention: Daniel K. Winton (Space Above for Recorder's Use Only) SEWER SERVICE AGREEMENT FOR BOLSA CHICA BETWEEN COUNTY SANITATION DISTRICT NO. 11 AND SIGNAL BOLSA CORPORATION OCTOBER, 1991 TABLE OF CONTENTS SECTION 1. Incorporation by Reference, Definitions. . . . . . . . . . . . . 4 1.1 Recitals and Exhibits. . . . . . . . . . . . . . . . . . . . . . . . . . 4 1. 2 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 SECTION 2. Provisions of Sewer Service to Property. . . . o . . . . . . . .6 2. 1 Trunk Sewer Service by District. . . . . . . . . . . . . . . .6 2. 2 Environmental Procedures. . . . . . . . . o . . . . . . . 7 SECTION 3. Annexation and Payment of Annexation Fees. . . . . . . . . . .7 3.1 Annexation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 3.2 Preannexation Payments. . . . . . . . . . . . . . . . . . . . . 0 . . 08 3.3 Annexation Fees. . . . . . . . . . . . . . . . . . . . . . . . . . ... . . . . 9 3.4 Nonurban Areas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 3 .5 District Obligation to Serve. . . . . . . . . . . . . . . . ooll 3.6 Annexation of Other Properties. . . . oo . 00 . . . . — oll 3.7 Landowner 's Project Financing. . . . . . ... . . . . .-.-. ...11------ 3.8 Other District Fees. . . . . . . . . . . . . . . .': . . . . . . . . . .12 SECTION 4. Termination by Landowner. . . . . . . . . . . . : . . . . . . . . . . . . . 12 SECTION 5 . Reimbursement . . . . . . . . . 5 .1 Unexpended Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 5.2 Expended Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 5 .3 Interest on Reimbursable Advances of Fees. . . . . . . . . . . . . . . . .- . . . . . . . . . . . . . . . . . . . . .13 SECTION 6 . Additional Rights and Duties. . . . . . . . . . . . . . . . . . . . . . . 14 6 .1 Landowner Obligations. . . . . . . . . . . . . . . . . . . . . . . . .14 6.2 District Obligations. . . . . . . . . . . . . . . . . . . . . . . . . .15 SECTION 7 . Court Action; Attorney's Fees. . . . . . . . . . . . . . . . . . . . . .15 SECTION8. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 SECTION 9. Successors and Assigns. . . . . . . . . . . . . . . . . .. . . . . . . . . . .16 . SECTION10. Recordation. . . . ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 SECTION11 . Merger. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . . . . . . .16 EXHIBITS EXHIBIT A - THE PROPERTY AND THE BOLSA CHICA PROPERTY EXHIBIT B - ADDITIONAL SEWAGE FACILITIES EXHIBIT C - URBAN AREAS AND NON URBAN AREAS OF PROPERTY EXHIBIT D - PREANNEXATION PAYMENTS SEWER SERVICE AGREEMENT This Sewer Service Agreement, effective Nov. 13 1991, is between County Sanitation District No. 11 of .Orange County, California ( "District") and Signal Bolsa Corporation, a California corporation ("Landowner") (District and Landowner are sometimes referred to together as the "Parties" ) , and is made on the basis of the following facts, intentions and understandings: A. District is a governmental subdivision of the State of .California, organized and existing under the County Sanitation District Act, California Health & Safety Code- Sections 4700 et sea. B. Landowner is the owner of approximately 1170 acres of real property (the "Property") within a larger parcel of land, consisting of approximately 1600 acres (the "Bolsa Chica Property") , situated in an unincorporated! area of Orange County (the "County" ) commonly known as "Bolsa Chica. " Each parcel is more particularly depicted on attached Exhibit A. C. It is understood that Signal Landmark, an affiliate of Landowner, has a right to purchase a parcel of property within the Bolsa Chica Property (the "MWD Parcel") from the Metropolitan Water District of Southern California ("MWD") . If Signal Landmark acquires the MWD Parcel, the Parties intend that the MWD Parcel may at Landowner's election be made subject to this Agreement. D. The Bolsa Chica Property contains several parcels in addition to the Property,. i.e. , parcels owned by other persons or 100991 -1- 149011-07 entities, including, but not limited to, the State of California, Fieldstone Company, Inc. , Donald Goodell, Huntington Beach Company, Ocean View School District and the MWD. E. In order to assure Landowner that sewer service will be provided to the Property and to the Bolsa Chica Property, the Parties desire to enter into this Agreement setting forth the terms and conditions of the Property's future annexation. It is understood that certain provisions of this Agreement have been agreed to regarding the Property because Landowner is securing a Specific Plan/Local Coastal Program subject to certification by the California Coastal Commission and to approval of development permits by the U.S. Army Corps of Engineers ( "Development Plan") . F. The District presently needs Additiona r-gewer Facilities (which are- more particularly described in the attached Exhibit B) to adequately serve its present service area other than the Bolsa Chica Property, as well as to serve the Property. The Additional Sewer Facilities will be part of the Main Trunk Sewer Facilities (see Section 2.1 below) . In order to build the Additional Sewer Facilities on a timely basis, the District needs funds in advance of the time that the proposed Development Plan is certified, the development permits are issued, and annexation fees would normally be paid to the District by Landowner and other owners of the Bolsa Chica Property. G. Landowner desires to assist District in the timely construction of the Additional Sewer Facilities and Landowner will pay certain fees before the Property is annexed into the District for this purpose ( "Preannexation Payments") in such 032891 -2- 149011-07 amounts and at such time as shown on attached Exhibit D. Landowner will receive a credit for the Preannexation Payments made against the Annexation Fees as determined on an acreage basis. If any sums remain after such application, such sums shall be credited to any connection or hook-up fees and sewer service fees to be paid by Landowner. H. District desires that the parcels owned by others also be included in the future annexation with the Property on similar terms and conditions as set forth below (subject to changes in rates of Annexation Fees and connection charges) , so as to - provide cohesive service areas under a single plan of facilities. I . Development of the Property may begin as early as 1994 and will continue in phases over a period of years thereafter . Approximately 312 acres of the Property will be devoted to Urban Uses (as defined in Section 1.2.15 below) and approximately 857 acres will be devoted to nonurban uses. The areas of the Property which will be devoted to these uses are referred to as the Urban Areas (see paragraph 1.2.14) and the Nonurban Areas ( see paragraph 1. 2.10) and are as approximately shown on attached Exhibit C. The final location of the Urban Areas and the Nonurban Areas will be determined at the time the Development Plan is certified and approved. At that time, the amount of acreage within the Urban Areas will be recalculated and appropriate adjustments made to the Annexation Fees as provided below. NOW, THEREFORE, the Parties agree as follows: 032891 -3- 149011-07 SECTION 1. Incorporation by Reference; Definitions. 1.1. Recitals and Exhibits. All of the paragraphs set forth in the Recitals and all of the attached Exhibits are deemed true and correct and are incorporated in, and made a part of this Agreement by this reference. 1. 2. Definitions. For purposes of this Agreement, the following definitions apply: 1.2.1 "Additional Sewer Facilities-- is defined in. paragraph. F above .and_ described in attached Exhibit B. 1.2.2 "Annexation Fees" are those fees which are to be paid to the District as a condition to annexing the Property into the District and shall equal the product of, ( i ) the per acre annexation fee as established by District Resolution and in effect at the time payment is made, multiplied by ( ii ) the number of acres ( to the nearest .01 of an acre) within the Urban Area under the certified Development Plan. . 1.2.3 "Bolsa Chica Property" is as defined in paragraph B. above. 1.2.4 "City" means the City of Huntington Beach, Orange County, California. 1.2.5 "Collector System" means the necessary sanitary sewers, force mains and pump stations that will be constructed in connection with the development of the Property. 032891 -4- 149011-07 1.2.6 "County" means Orange County, California. 1.2.7 "Deferred Fees" is as defined in Section 3. 4.1 below. 1.2.8 "Development Plan" is as defined in paragraph E. above. 1. 2.9 "Main Trunk Sewer Facilities" is as defined in Section 2.1 below. 1.2.10 "Nonurban Areas" means those areas of the -Property which will be used for uses other than Urban Uses, including without limitation, the County Linear Regional Park , Flood Control Channel, wetlands, environmental• iiensitive habitat areas ( "ESHAS" ) , open space and Major Arte-rial Roadways. 1.2.11 "Major Arterial Roadways" means - major and primary classifications of streets as set forth in the Orange County Master Plan of Arterial Highways, including the i Bolsa Chica cross-gap connector and the Mesa Connector as specified in the Development Plan. 1.2.12 "Preannexation Payments" are the payments to be made by Landowner to District before the Property is annexed to the District in such amounts and at such times as shown in attached Exhibit D. 1. 2.13 "Property" is as defined in paragraph B. above. 1. 2.14 "Urban Areas" means all areas of the Property which will be used for Urban Uses. 032891 -5- 149011-07 1. 2. 15 "Urban Uses" means all residential improvements Landowner intends to develop on the Property ( including not to exceed 5,700 dwelling units) and commercial improvements. SECTION 2. Obligation to Provide Sewer Service to Property. 2 .1. Trunk Sewer Service by District . Upon annexation of the Property to the District and completion by Landowner of the construction of the Collector System, District shall provide trunk sewer, wastewater treatment and disposal service ( "Main Trunk Sewer Facilities" ) to serve the,'Urban Areas within the Property by connection of the Collector- System to the Main Trunk Sewer Facilities. District shall ensure that the Additional Sewer Facilities are completed and that the Main Trunk Sewer Facilities are ready to serve the Property upon Landowner ' s t completion of its first segment of the Urban Area, subject only to District 's timely receipt of necessary funding and regulatory approval (which District shall use its good faith diligent efforts to obtain) . At the present time, it is contemplated that the Main Trunk Sewer Facilities required to serve the Property shall include, but not be limited to (a) the District's Warner Avenue trunk sewer located within Los Patos Drive, Bolsa Chica Street and Warner Avenue, (b) the District's Slater Master Plan Trunk Sewer and Pump Station, and (c) the Additional Sewer Facilities. 032891 -6- 149011-07 If there is any substantial change in the Main Trunk Sewer Facilities, District and Landowner shall promptly notify the other in writing of such changes in order to allow each Party time to adjust its plan to meet such changes, if necessary. Before any changes are made, both District and Landowner must first approve these changes, which approval shall not be unreasonably withheld or delayed. District shall treat and dispose of the additional sewage generated by the Property at District ' s regional treatment facilities. 2.2. Environmental Procedures. District shall ensure that all applicable environmental procedures and documentation necessary to annex the Property and construct the Main Trunk Sewer Facilities shall be timely undertaken and timely completed by itself or other responsible agencies in order to implement the terms and conditions of this Agreement. SECTION 3 . Annexation and Payment of Annexation Fees. 3.1. Annexation. 3 .1.1 Application for Annexation. At any time , Landowner may by written notice to District request that the District annex the Property, and District shall annex the Property provided, (i) all Annexation Fees are paid as specified in Section 3.3 in full at the time of the District's action to grant the request by Landowner to initiate annexation proceedings, and (ii) Landowner provides its written consent to the completion of proceedings for annexation of the Property to the District. 032891 -7- 149011-07 3.1.2 New Sanitation District . Landowner further consents, as an alternative, to the inclusion of the Property within the boundaries of any new Sanitation District which becomes a party to the Joint Administration Agreement among all existing Orange County Sanitation Districts, formed for the purpose of providing sewer service to the Property instead of by the District, under substantially the same terms and conditions of this Agreement. 3.1.3 LAFCO Costs. All costs of application and processing the annexation of the Property shall be payable by Landowner and shall be paid to District at the time of filing the initial application with the County Local Agency Formation Commission ( i .e. LAFCO) . 3.2. Preannexation Payments. 3.2.1 Payments. The Preannexation Payments are to be paid to the District in the amounts, and before the times set forth on attached Exhibit D by certified check delivered to the District. 3.2.2 Credit for Payments . Landowner shall be entitled to a credit for any Preannexation Payments made as follows: (i) to any Annexation Fees due in an amount equal to the product of: (A) the per acre Annexation Fee in effect at the time the Annexation Fee is to be paid under Section 3.3, multiplied by (8) (the following determination is to be made as of the time of each Preannexation Payment) (I) the Preannexation Payment, divided by (II) the per acre Annexation 032891 -8- 149011-07 Fee in effect at the time the particular Preannexation Payment is made; and ( ii) if any amounts from the Preannexation Payments remain after application as provided in (i ) , to any connection or hook-up fees or sewer service fees to be paid by Landowner. 3 .3. Annexation Fees. 3.3.1 Payment of Annexation Fees. Annexation Fees (other than deferred fees as set forth in Section 3 .4 ) are to be paid at or before District grants Landowner ''s request to initiate annexation proceedings. 3.3 .2 Adjustment of Annexation Fees. The Bolsa Chica Property has been excluded from the Agreement to allocate real property tax revenues under California Revenue and Taxation Code, Sections 95 through 100. 5 et sec. and the California Constitution Article XIIIA between the District , the County, the Orange County Flood Control District and -the Orange County Beaches and Harbors District ( referred together with the County as the "County" ) . Should the District secure a portion of property tax revenues from the County, the Annexation Fees for the Property and the Bolsa Chica Property shall be retroactively adjusted downward on a uniform basis in an amount as reasonably determined by District. The amount of the adjustment shall first be credited to any unpaid Annexation Fees or connection fees , or, if such have been paid, by refund to Landowner within 90 days of receipt of funds by the District. 032891 -9- 149011-07 3. 4. Nonurban Areas. 3.4 .1 Deferred Fees for Nonurban Areas. Since sewer service is not required (or approved) for any Nonurban Areas within the Property, District shall defer any obligation of the Landowner to pay the District's annexation fees for the Nonurban Areas ( the "Deferred Fees" ) . 3.4.2 Urban Uses Within Nonurban Areas. If Nonurban Areas require sewer service for Urban Uses within the Nonurban Areas (i.e. , a wetlands visitor center ) , District shall set the Annexation Fees for such Urban Use area(s) based on the acreage designated for Urban -Use (to the nearest . 001 of an acre) and the per acre Annexation Fee in effect by District',as of the date of payment. Deferred Fees shall be paid by the Landowner within 30 days after receipt of approval by District for sewer service or before the connection to the District 's facilities, whichever is sooner. 3 . 4 . 3 Development of Nonurban Areas. If at some future date, Landowner obtains approvals for the development of any portion of the Nonurban Areas, application shall be separately made to District to obtain sewer service, approval of which shall be within the discretion of District and subject to such terms and conditions as reasonably established by District. 3. 4 .4 Limited Service to Nonurban Areas. District shall, upon application of the governing agency of all or any portion of the Nonurban Areas, provide limited sewer service for the benefit of the recreational users of that portion 032891 -10- 149011-07 of the Nonurban Areas, upon payment of application fees and submittal of plans and specifications. 3.5. District 's Obligation to Serve. If Annexation Fees have been paid in full for the Property as specified in this Agreement (excluding Deferred Fees as provided in Section 3 . 4 above) , District shall permit the Collector System to be connected to the Main Trunk Sewer Facilities and District shall accept for treatment and disposal all sewage generated from the Property. 3.6. Annexation of Other Properties. If District desires to include the other property owners of the _ Bolsa Chica Property in the District as part of this"annexation proceeding, Landowner will use its good faith reasonable efforts to obtain such other property owners ' authorizations if they have not previously joined with Landowner in requesting annexation of such other property into the District; however, this covenant is not a condition precedent to any of the terms of this Agreement. 3.7. Landowner ' s Project Financing. Landowner ' s payment of money under this Agreement will be used to pay for a. portion of the cost of constructing the Main Trunk Sewer Facilities, and incidental costs related thereto for administration, planning, design and construction. It is acknowledged by District and Landowner that, to the extent provided and allowed by law, the monies paid under this Agreement are the subject of repayment to Landowner from a community facilities district, assessment district, or• financing entity, the sponsor of which has not yet been identified. 032891 -11- 149011-07 3.8. Other . District Fees. Landowner acknowledges that District has authority, under California Health & Safety Code Section 5471 et seq. to establish connection fees and sewer service fees provided to properties and that District, by adoption of a required ordinance, may determine to establish a connection fee and sewer service fee to pay for the cost of construction, operation and maintenance of Main Trunk Sewer Facilities serving the Property. These connection fees and sewer service fees may be collected by direct payment or by collection with other taxes and charges on the property tax rolls, as •• authorized by California Health & Safety Code Section 5473. These charges are separate and in addition to Annexatiion Fees provided for in this Agreement. SECTION 4 . Termination by Landowner . Landowner, in its sole discretion, and at any time, may elect not to annex the Property to the District and to terminate this Agreement by delivering written notice to the District . SECTION 5 . Reimbursement. 5.1. Unexpended Funds. If Landowner elects to terminate this Agreement under Section 4 above, then any monies paid to the District under Section 3 of this Agreement which have not been expended or encumbered by District as of the date of Landowner 's notice of termination, shall be refunded to Landowner within 90 days after District 's receipt of Landowner 's notice of termination, together with interest as specified in Section 5.3 032891 -12- 149011-07 below. For purposes of this Section "expended" or "encumbered" shall mean funds that have been expended for goods or services to District 's vendors, suppliers or consultants, or that the District is bound by contract to pay for such items. 5.2. Expended Funds . If Landowner elects to terminate this Agreement under Section 4 above, and if District has already expended or encumbered such funds advanced by Landowner, District shall reimburse Landowner for that portion of any funds expended which do not directly relate to the Property, together with interest under Section 5.3, to the extent that connection fees and any other fees can be collected from other landowners , which fees District shall use its good Mth diligent efforts to collect. Reimbursement shall be based' on the amount of capacity designated for the Property that is used for other lands as determined according to sound and industry accepted engineering principles, and shall. be in the same ratio as the amount of capacity used for other lands relates to the total capacity designated for the Property. Such sums will be paid to Landowner within 90 days after receipt of funds by the District . Upon written request from Landowner, District shall promptly provide Landowner with a complete and accurate accounting of the connection fees and any other fees collected from the other landowners. 5.3. Interest on Reimbursable Advances of Fees. Reimbursement of any fees advanced by Landowner to the District shall include interest at the rate of seven (7) percent 032891 -13- 149011-07 per annum beginning with the date of receipt by District of Landowner 's notice of termination. and continuing through the date of payment to Landowner. SECTION 6 . Additional Rights and Duties. 6.1. Landowner ' s obligations. By accepting the terms of this Agreement, Landowner shall: 6.1.1 Exert its good faith, reasonable efforts to provide authorizations of all other property owners as soon as possible if required under Section 3 .6; and 6 . 1. 2 Assist District in its ad valorem tax exchange request with other governmental agencies if',required under this Agreement. 6.2. District ' s Obligations. By accepting the terms of this Agreement , District shall: 6 . 2.1 Annex the Property when requested by Owner ; 6 . 2. 2 Amend District 's Master Plan as and when necessary for construction of the Main Trunk ' Sewer Facilities and District 's compliance with this Agreement. 6 .2.3 Complete construction of the Main Trunk Sewer Facilities in order to allow the connection of the Local Collector System at the time all or any portion of the Property is annexed to the District; 6 . 2. 4 Permit connection of Collector System to the Main Trunk Sewer Facilities and accept for treatment and disposal all sewage generated from the Property upon payment of 032891 -14- 149011-07 the Annexation Fees, applicable connection charges and fees as specified in this Agreement. SECTION 7. Court Action; Attorney's Fees. If either Party institutes any proceeding in court to enforce any provisions of this Agreement or for damage by reason of an alleged breach of any provision of this Agreement, the prevailing party shall be entitled to recover such amount as the court may award as reasonable attorney' s fees, expert witness fees, consulting fees and costs, both at trial and on appeal. SECTION 8. Notices . All notices or other communications required or permitted under this Agreement shall be in writing, and shall be either personally delivered, sent by commercial courier such . as Federal Express, or sent by registered mail or certified mail, return receipt requested. All notices shall be deemed received upon receipt . TO DISTRICT: County Sanitation District No. 11 of Orange County, California 10844 Ellis Avenue Fountain Valley, CA 92708 With Copy to: Thomas L. Woodruff, Esq. Rourke 6 Woodruff 701 South _Parker Street, Suite 7000 Orange, CA 92668 TO LANDOWNER: Signal Bolsa Corporation c/o The Koll Company 4343 Von Karman Avenue Newport Beach, CA 92660 Attn: Lucetta Dunn With Copy to: Daniel K. Winton Paone, Callahan, McHolm & Winton 19100 Von Karman Avenue, 8th Floor Irvine,. CA 92713 100991 -15- 149011-07 Notice of change of address shall be given by written notice in the manner detailed in this Section B. SECTION 9. Successors and Assigns. This Agreement and all rights • and duties under this Agreement shall be binding upon and inure to the benefit of all Parties, and their respective successors and assigns . No Party may delegate a duty, assign or transfer a . right arising out of this Agreement without .the prior written approval of the other Party except Landowner 's obligation to assign any obligations and rights to ..a Local Agency as set forth - -- - in Section 2. 1. Notwithstanding the foregoing, Landowner may assign this Agreement and all -of its rights and.-obligations under the Agreement to a third party in connection with a sale, transfer or conveyance of all or substantially all of the Property and upon the assumption of such rights and obligations by such assignee, Landowner shall be relieved of any further obligation under this Agreement . SECTION 10. Recordation. This Agreement shall be recorded in the Office of the Orange County Recorder within 10 days after its execution by all Parties. SECTION 'll. Merger. This Agreement contains the entire understanding between the Parties relating to the transaction contemplated by this Agreement and all prior contemporaneous agreements, understandings, representations and statements, oral 032891 -16- 149011-07 or written, are merged into this Agreement and shall be of no further force or effect. IN WITNESS WHEREOF, the Parties have executed this. Agreement to be effective on the day and year first above written. COUNTY SANITATION DISTRICT NO: 11 OF ORANGE COUNTY, CALIFORNIA By: l�l Grace H. Winchelal _r Chairman, Board of Directors By: Rita J. B own,., Secretary? Board of Directors APPROVED AS TO FORM: THOMAS L. WOODRUFF, ' DISTRICT GE RAL COUNSEL By: SIGNAL BOLSA, a California corporation By: THE KOLL COMPANY, a California corporation, its Managing Agenntt--� j \ "R. . , APPROVED AS TO FORM: By. ./ RaymondJ. Pacini, Vice resident PAONE, CALLAHAN, McHOLM & WINTON By: Daniel K. Winton 032891 -17- 149011-07 STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On OCrabCit. /,, /99/ before me, the undersigned, a Notary Public in and Qf r said State, personally appeared ����•��'� �"� • an personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within instrument as the 01VI61'Z,J p2GS,.0�u and , respectively, on behalf of The Koll Company, that executed the within instrument and acknowledged to me that such corporation executed the within instrument pursuant to its bylaws or a resolution of its board of directors being known to me to be the Managing Agent of Signal Bolsa, the corporation that executed the within instrument, and acknowledged to me that such corporation executed the same as such Managi Agent and that such Managing Agent executed the same. WITNESS my hand official seal. SEAL y Busy► Jy µabry pubnc-Cattranla Notary Pub 1 i c OwwGE COUNly < 5 EA)Commis«,g es STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) f On November 13, 1991 , before me, the undersigned, a Notary Public in and for said State, personally appeared Grace H. wincheli and Rita J. Brown, personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed the within- instrument as the Chairman and Secretary, respectively, on behalf of County Sanitation District No. 11 of Orange County, California, and acknowledged to me that County Sanitation District No. 11 of Orange County, California executed the within instrument pursuant to its bylaws or a resolution of its board of directors. WITNESS my hand .and official s 1. 00/ Penny Kyle Notary c (SEAL) - - _.FFICiaL sYAL Fw411Y KM NOTARY RISUC.CA;VMM OWGE COU N M�Cwrm Ezwu Seat 1.1"2 032891 -18- 149011-07 CITY QF t-IUNTINGTQN BEACH TOTAL ACREAGE BY OWNERSHIP METROPOLITAN 941AcO&OWAND Mary AVsla"AI j DEAN O/fNIMMa "Its WATER DISIRIG - / • A aFOonAN tr•• •WW L SIMM COTMOrATIOM•LOWLAOr Tb"� Wr0gTOM [AfN Icy Mas H I F H COMPANY ..•'GM L NXSA"MWOUTOW•OUT►AMC•a T/A 10 0 AC f OR OF MUMING10"•[ACTT Tl.T J IS w O IY(lM0/OUTA IVAI•I11WOU 11) M• . ►letuslOMs •a� . �' •�,a a.m scw Yrrw a OrllrsGt •a• .\ •`• os. nolu �s 1• s_ Mwrrs•OIOM WACN C)WANY q0 ;• I ltw FIELDSTONE '�"� •' JJ 4 E . SIGNAL QOLSA CORPORATION .�• ,�;! P4 _—� SIGNAL,BOLSA SIGNAL BOLSA uJAG MAIM COUNTYIFLOW COMM oraiwcrfAS•y[Nr CORP ORATION _ �• _ '.1SC W OCEAN VIEW x3 :` to '\i0UN0g!cif UNINCOIieQ(U,�O•CoUNT1.t^mSL. �. 1 I �-`' '_ I•I • _^��=� �"��� -. .,._. _ .T z••, _:i' """1 Tom" .r... _. ... � _�•r MOM fit lift[TOAW 94ftO TO STATE U••D!A TrA•ASOT Nr7A0Ar•lrtrrT •b rN LGMµ•QSA •.•I:l1AK771l AL7rl•U•IOIA r•1G1l/C 1 cwsT•w.s+w7 • ea sloe BOLSA CHICA ®tI"" •�.7t"-L1. cmmnaoop • ExMrlfflT A { �Ol•A CNTCA•TUOY AWA SOUNOAIN ..................................•••••••••••.............•..................................... .........•...•••....•••••••.••••••......------......................••••••••.A i K 1 101NOIA AVElilt I' 1 • • Ix • '1- M : N� its Ull! ' rl 1 1 EC IIA, • � 1 1.1 • 1` 1 HEIL NI1\ AVENUS INTEROWTOR • LEOENO at, !!• E•• >i 1 1— N Kt M, U.w•r Ate••+ OIIA.IIV S&ING119-N!w W -11M CIMINT !`± PAXALLIt MM td1C!MAIN a . F 1 iF w w 1 1 t MlllEp-NOlOER • TRUNR { SEWER NIAANEA l AYE r•r�r ~/r. •r.••• \••.r •i• r.r •. irs N ly 1 r • w J ~ U) Z IR !E• 0. A O 0. IM J C: i i{~ o Ise V, o - : t l In I F W W ,. r sl{K it i 1.9 J �{ E4 -6 IN SLATER-S►RINGDALE TRUNK SEWER �E, TE, ���� ! { w y allA A--—alp OOALE RIN RELIE/ ip MK I E EEC EEC r 7 H SLATER AVENUE DIVERSION J H PUMP STRUCTURE IT1 STATION 1 1 x _ x w RECOMMENDED IMPROVEMENTS CSDOC SEWERS SLATER AVENUE IIMI STATION SEWAGE SYSTEM IMPROVEMENTS COUNIT SANITATION DISTRICT/ O/ ONANOE COUNTT EXHIBIT 0 LEGEND WIfEODEVELOPMENT(RES.COMM..REC•) ,. LDR LOW DENSITY RESIDENTIAL ,' :': ••; Q ESTATE RESIDENTIAL '' t• •+�• ' COS CONSERVATION•OPEN SPACE .. . rn--O—Sl RECREATION-OPEN SPACE E Q SDO Wi L1JE Y A11/a EE300I OF 011.WIATEO ' . , ! •,�: , ; ROS w p URSA"AREAS ® NDNUROAN AREAS ,• ,.• �f . . -1t]R.: u H En �:�• J�, . : :•:Illy : ' � _ _ ,; u MCE IC . OCEAN.«.r..... ... »....M.-- ..... ; --L-+ DOLSA CHUM LAGS® USE eltAO EXHIBIT C BOLSA CHICA =-j PREANNEXATION PAYMENTS Form of Time of Payment Payment Payment 1) Within 30 days after $250,000.00 Cash signing of Agreement 2) Within 180 days after $500,000.00 Cash or other commencement of alternate construction of the security as Slater Avenue Pump deemed accept- Station .(see Recital able by the F and Exhibit B to District's the Agreement General Counsel. A letter of credit shall be deemed acceptable as alternate security. 3) Within 30 days after An amount equal Cash certification and to the balance approval of the of the estimated Development Plan (see Annexation Fees Recital E of Agreement) due _ EXHIBIT D TO SEWER SERVICE AGREEKENT I 2. (City Council) Tentative Tract Map (TTM) No. 15469 — Conditional Use Permit(CUP) No. 97-80 — Environmental Assess ment/Negative Declaration (EA/ND) No. 97-21 (Meadowlark Development Plan) Applicant: Bruce D'Eliscu for Catellus Residential Group Request: (a) A Tentative Tract Map to subdivide approximately 48.4 acres into 315 numbered lots; (313 residential lots, 1 public park and 1 private park); 16 lettered open space lots; and 3 lettered common access (driveway) lots in order to establish a 313 unit residential development with an overall project density of 9.8 dwelling units per net acre (6.5 du/gross acre) pursuant to Section 4.0 of the Planning Commission approved Meadowlark Specific Plan. (b) A Conditional Use Permit to construct 313 single family detached dwelling units on.small-lots (minimum sizes) ranging between 3,120 sq. ft. and 4,680 sq. ft. (average lot size 4,125 sq. ft.) within the residential district of the Meadowlark Specific Plan pursuant to Section 4.0 of the Planning Commission approved Meadowlark Specific Plan. (c) An Environmental Assessment/Negative Declaration to determine project impacts related ZTA No. 97-4, ZMA No. 97-1, TTM No. 15469 and CUP No. 97-80. [Staff and developer reports presented.] Public Comments [(1) Several speakers in support of staff recommendation to protest SCWC application to PUC. (2) Many speakers in opposition to Wal-Mart Project.] sty Council) Application Of The Southern California Water Company For A Certificate Of Public Convenience And Necessity To The California Public Utilities Commission To Extend Its West Orange County System To The Bolsa Chica Planned Community Communication from the Assistant City Administrator transmitting material regarding the application filed by the Southern California Water Company to the Public Utilities Commission to extend its West Orange County System to the Bolsa Chica Planned Community. Recommended Action: To be submitted by the City Administrator and staff at this City Council meeting. [Direct the City Attorney to file a protest objecting to the granting in whole of the authority sought with the Public Utilities Commission to Application A9811003 (Bolsa Chica Water Service) and that the City Council request an evidentiary hearing. Approved 4-3-0 (Julien, Green, Garofalo NO] COUNCIL/AGENCY ADJOURNMENT: The next regular meeting is Monday, December 7, 1998 at&99 6:30 p.m. in Room B-8, Civic Center, 2000 Main Street, Huntington Beach, California. CONNIE BROCK`VAY,CITY CLERK City of Huntington Beach 2000 Main Street-Second Floor Huntington Beach,California 92648 Telephone: 714/536-5227 Internet: http://NitivNv.ci.huntington-beach.ca.us gU77ZW- eery A�.en�y Council/Agency Meeting Held: Deefferred/Continued to: A proved Conditionally Appro ed ❑ De ied �tP� y lerk's Signature Council Meeting Date: November 30, 1998 Department ID Number: CD98-57 CITY OF HUNTINGTON BEAMEIVED FROM AND MADE A PART OF THE RECOD AT THE REQUEST FOR ACTION COUNCIL MEETING OOF _ OFFICE OF CITY CLERK CONNIE BROCKWAY,CITY CLERK SUBMITTED TO: HONORABLE MAYOR AND.CITY COUNCIL MEMBERS SUBMITTED BY: RAY SILVER, City Administrator PREPARED BY: HOWARD ZELEFSKY, Planning Director C� SUBJECT: DIRECT STAFF REGARDING PENDING PUC APPLICATION FOR WATER SERVICE TO THE BOLSA CHICA Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s) Statement of Issue: The City of Huntington Beach has received an application by Southern California Water Company (SCWC) submitted to the Public Utilities Commission (PUC) requesting a certificate of public convenience and necessity to extend SCWC's West Orange County System in the Orange County District by constructing a 6.75 mile water transmission pipeline to serve the Bolsa Chica Planned Community. Transmitted for your consideration is a request for the City Council to direct the City Attorney to file a protest to the Public Utilities Commission. Funding Source: Not applicable. Recommended Action: A. STAFF RECOMMENDATION: Motion to: 1. "Direct the City Attorney to file a protest with the Public Utilities Commission to Application A9811003 (Bolsa Chica Water Service)." & q�- /7e✓gra�Zi , �4 /n whole of Ae auth,0A_1 you hf wi t fhe ��6/� lff,/� yes �orr�in�,ss�o�l /0D3 e �. �eRiiice ccndha.t �he� y'D✓7; 17-1-3- REQUEST FOR ACTION MEETING DATE: November 30, 1998 DEPARTMENT ID NUMBER: CD98-57 Analysis: A. BACKGROUND: In July of 1997, Koll Real Estate Group submitted plans to construct a water transmission line from Southern California Water Company (SCWC) facilities in the City of Cypress to the Bolsa Chica Planned Community. The City Attorney's Office analyzed the documents submitted and questioned whether Koll should first apply to the Public Utilities Commission (PUC) for a certificate of convenience and public necessity before the City needed to review the plans. Koll responded back through its attorneys indicating that they had formed the Bolsa Chica Mutual Water Company (BCMWC) to construct and own the pipeline that would provide water service. Because the PUC does not have jurisdiction over mutual water companies like BCMWC, Koll did not need to obtain the PUC certificate. Apparently, Hearthside Homes (successors to Koll) has now determined that the Bolsa Chica Planned Community should be served directly by SCWC. SCWC is under the jurisdiction of the PUC. Consequently, on November 5, 1998 SCWC filed an application for a certificate of public necessity with the PUC. On November 20, 1998, the SCWC also applied for a wastewater application. The City now has a 30-day window to consider filing: a "protest" or a "response" to the applications. Unfortunately, the deadline for filing either document is December 5, 1998. (PUC Rules 44.1.) PUC Rule 44 defines these two documents as follows. "A protest is a document objecting to the granting in whole or in part of the authority sought in an application . . . [A] response is a document that does not object to the authority sought in an application, but nevertheless presents information that the party tendering the response believes would be useful to the Commission in acting on the application." A protest must include "the facts constituting the grounds for the protest, the effect of the application on the protestant, and the reasons the protestant believes the application, or a part of it, is not justified. If the protest requests an evidentiary hearing, the protest must state the facts the protestant would present at an evidentiary hearing to support its request for whole or partial denial of the application." (PUC Rule 44.2.) Obviously, a protest is a stronger objection to the application. However, as PUC Rule 44.4 provides, "[t]he filing of a protest does not insure that an evidentiary hearing will be held. The decision whether or not to hold an evidentiary hearing will be based on the content of the protest." Once a protest or response is filed, the PUC will set a "prehearing conference" between the applicant and any parties interested in the application. The parameters of the prehearing conference are set forth in PUC Rule 49. After the prehearing conference, CD98-57 -2- 11/30/98 5:07 PM REQUEST FOR ACTION MEETING DATE: November 30, 1998 DEPARTMENT ID NUMBER: CD98-57 there are opportunities to file motions, request discovery and propose settlement until, eventually, a hearing is held on the application. Various PUC Rules address these actions. B. STAFF ANALYSIS AND RECOMMENDATION Staff has investigated the availability of an extension of time to file a protest or response with the PUC staff. PUC staff has advised City staff that it is unlikely that extension of time will be granted because a pre-conference hearing will soon be set for this application. Staff recommends filing a protest because it will provide the City with "interested party" status and will insure the opportunity to meet with PUC staff and the applicant at a pre-conference hearing. The City would be better represented in the PUC process by filing a protest at this time. RCA Author: win CD98-57 -3- 11/30/98 5:07 PM BEFORE THE PUBLIC UTILITIES COMMISSION . OF THE STATE OF CALIFORNIA In the Matter of the Application of Southern California Water Company (U 133 W) for a Application No. Certificate of Public Convenience and Necessity pursuant to California Public Utilities Code Section 1001 to Extend Its West Orange County System to the Bolsa Chica Planned Community. :- _ APPLICATION z � z MC) Susan L. Conway, Vice President Southern California Water Company 630 East Foothill Boulevard San Dimas, California 91773 Telephone: (909) 394-3600 Facsimile: (909) 394-7427 October 23, 1998 TABLE OF CONTENTS Page I. STATEMENT OF RELIEF SOUGHT ...................................................................1 II. BACKGROUND ...................................................................................................2 A. THE ORANGE COUNTY DISTRICT.........................................................2 B. THE BOLSA CHICA PLANNED ;OMMUNITY.........................................6 C. THE NEED FOR A WATER SUPPLY.......................................................8 III. THE WEST ORANGE COUNTY SYSTEM EXTENSION ....................................9 A. THE WATER TRANSMISSION PIPELINE................................................9 1. DESCRIPTION...............................................................................9 a. LOCATION...............................................................:................—10 3. CONSTRUCTION.........................................................................10 4. COST ...........................................................................................11 B. SOURCE OF SUPPLY............................................................................11 C. RATES TO BE CHARGED......................................................................12 IV. ENVIRONMENTAL REVIEW UNDER CEQA....................................................12 V. JUSTIFICATION FOR THE EXTENSION..........................................................14 VI. FORMAL MATTERS AND PROCEDURAL REQUIRMENTS ............................15 VII. PRAYER............................................................................................................18 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA In the Matter of the Application of Southern California Water Company (U 133 W) for a Application No. Certificate of Public Convenience and Necessity pursuant to California Public Utilities Code Section 1001 to Extend Its West Orange County System to the Bolsa Chica Planned Community. Application to the Public Utilities Commission of the State of California (the "Commission"). 1. STATEMENT OF RELIEF SOUGHT By this application, Southern California Water Company ("SCWC") requests a certificate of public convenience and necessity pursuant to Section 1001 of the Public Utilities Code to extend its West Orange County System in the Orange County District by constructing a 6.75 mile water transmission pipeline to serve the residents of a new development referred to herein as the.Bolsa Chica Planned Community. The Bolsa Chica Planned Community is a residential development to be located in an unincorporated area of Orange County, adjacent to the City of Huntington Beach. The location of the extension in relation to SCWC's current Orange County District tariff area is shown on the map attached as Exhibit A. SCWC proposes to add the new water services, which will not be contiguous to its currently certificated service territory, to its Los Alamitos Customer Service Area ("Los Alamitos CSA°). The property to be served is owned by Signal Landmark, the successor in interest to Signal Bolsa Corporation (the "Developer"). Because the Developer has no other source of water supply, the Developer has asked, and SCWC has agreed to provide water service to the Bolsa Chica Planned Community.' For the reasons shown below, SCWC believes that the construction of the water transmission pipeline and the extension of its West Orange County System to provide water service to this new development is in the public interest. 11. BACKGROUND A. The Orange County District SCWC's Orange County District is comprised of two customer service areas — the Los Alamitos CSA and the Placentia CSA -- and four water systems that serve separate areas: the West Orange County System, the Placentia System, the Yorba Linda System, and. the Cowan Heights/Lemon Heights System. The West Orange County System, which is shown on Exhibit A, serves the Cities of Cypress, Los 1 The Developer has also asked SCWC to provide wastewater service to the Bolsa Chica Planned Development. Accordingly, SCWC is filing concurrently its Application pursuant to Section 1001 for permission to provide wastewater service to this new development. SCWC respectfully requests that these two Applications be consolidated for all purposes. 2 Alamitos, and Stanton, small portions of the Cities of Buena Park, Garden Grove, La Palma, and Seal Beach, and an adjacent unincorporated area of Orange County, which includes the community of Rossmoor. As of December 1997, there were 40,118 active customers in the Orange County District, of which 98% are in the commercial classification consisting of residential and business customers. Approximately 25,526 customers are within the Los Alamitos CSA. SCWC estimgtes:that the Orange County District will grow at an annual rate of about 280 customers per year. SCWC receives its water in the Orange County District from two sources: imported water from the Colorado River and the State Water Project (provided by the Metropolitan Water District of Southern California ("MWD") via the Municipal Water District of Orange County, the East Orange County Water District or the City of Seal Beach), and local groundwater (from the Santa Ana River Groundwater Basin) that is pumped from wells to the extent permitted by the rules and regulations of the Orange County Water District. The water produced from wells is generally of good quality and requires little treatment. In fiscal year 1996-97, approximately 63% of the water supply in the Orange County District was obtained from 27 SCWC-owned wells located within the Orange County District. The remaining water supply was purchased from MWD. A major Portion of the purchased water is taken directly into the distribution system. 3 The storage facilities in the Orange County District consist of steel tanks and concrete reservoirs from which booster pumps deliver water to the distribution system. The combined storage capacity of all storage facilities in the District is 11.4 million gallons. As of December 31, 1996, there were approximately 2,098,425 feet of distribution main in the Orange County District. The mains range in size from 1 inch to 16 inches in diameter. Various distribution main installation and replacements are planned for the Orange County District. The Orange County District has an operating capacity of 58,992 gallons per minute ("gpm"), a standby capacity of 3,709 gpm, and an additional peaking capacity of 11,980 gpm. The District also has emergency interconnections with the Cities of Anaheim, Buena Park, Brea, Fullerton, Garden Grove, Orange and the Yorba Linda Water District, as well as with SCWC's Artesia system. The West Orange County System has an operating capacity of 10,386 gpm under normal operating conditions from active groundwater wells, not including 2,512 gpm capacity from standby wells. Normal operating capacity of the wells is based upon the latest actual field tests. The operating capacity includes 1,000 gpm from the new Bloomfield well and a reduction in capacity of the Florista well to 1,000 gpm. The West Orange County System has three connections to the MWD feeder mains, which 4 provides 24,700 gpm maximum capacity. The system has 6,600 gpm of peaking capacity from storage of which 1,155 gpm is available to meet maximum day demand. Accordingly, the West Orange County System has 36, 241 gpm of water flow available from all sources to meet maximum day demands. The Los Alamitos CSA office is located at 10852 Cherry Street in Los Alamitos. Requests for turn-on or close, billing inquiries, collection activities, leak reports, meter reading, congervation and public relations-related activities and other local matters are coordinated out of this office. Field operations for the Los Alamitos CSA are coordinated out of the Los Alamitos Field Operations Warehouse, located at 11082-A Winners Circle in Los Alamitos. Field operations include repairing main, hydrant and service leaks, new service installations, gate valve and hydrant maintenance programs, and 24 hour emergency response. 5 B. The Balsa Chica Planned Community The Balsa Chica Planned Community encompasses approximately 1,588 acres within unincorporated Orange County, as stiown on Exhibit A. The Balsa Chica Planned Community is coterminous with the County's Balsa Chica Local Coastal Program Area. The portion of the Balsa Chica Planned Community to be developed for residential purposes and which SCWC seeks to serve is the northerly subarea referred to as the Balsa Chica Mesa, which encompasses approximately 230 acres. The Balsa Chica Planned Community is surrounded by residential neighborhoods to the north, east and southeast in the City of Huntington Beach, and by the Pacific Coast Highway and the Pacific Ocean to the southwest. A variety of community benefits will result from the Planned Community, including a new elementary school that is needed to meet existing and future demands, a 17-acre community park that will provide panoramic views of the Balsa Chica wetlands and the Pacific Ocean, five miles of hiking and biking trails, the development of a child-care facility, an ecological, interpretative center to be constructed within Harriet Wieder Regional Park, and the dedication of approximately 49 acres of open space within Wieder Park. , The total number of lots to be developed is approximately 1,235. Construction is expected to begin in 1999. The square foot area of the smallest lots is 3,000 and of the 6 largest lots is 6,000. The average square footage of all lots is 4,700. The development will consist primarily of single family detached homes. A limited number of townhomes will be built. Homes will be constructed by merchant homebuilders and sold to the public. No custom lot sales or apartment units are planned for the development. The on-site water facilities that the Developer will construct to serve the Bolsa Chica Planned Community are described in detail in Section 3 of the Plan of Works Report for Water_ and Wastewater -("PWR") which is concurrently submitted under a separate cover. The on-site facilities include a 4.0 million gallon water storage reservoir, a booster pump station, a groundwater well, and the distribution system. The reservoir and pump station will consist of a below ground concrete reservoir and an above ground structure to house the distribution system pumps, on-site well equipment, pump controls, and provisions for emergency generator for back-up power. A single on-site well and treatment will be constructed to provide grading water and possibly to supplement the main supply source or serve the initial water needs of the development. Section 3 of the PWR describes the water system design criteria, demand factors, operating parameters, system pressures, reservoir storage calculations, and facility sizing calculations for pumping requirements and pipeline diameters. Figure 3.1 shows the proposed water system facilities as they relate to the development plan. The PWR also discusses emergency standby power for the pump station and standby sources of water supply. 7 C. The Need For A Water Supply The only water system located within one mile of the Bolsa Chica Planned Community is owned and operated by the City of Huntington Beach. In addition to the City of Huntington Beach, the two closest water systems to the Bolsa Chica Planned Community are owned and operated by the City of Seal Beach and by the City of Westminster.. Both the City of Huntington Beach and the City of Westminster have denied, or effectively denied in the case of the City of Huntington Beach, the requests for service made by the Developer. The City of Huntington Beach has effectively denied the Developer's numerous requests for water service by voting to reject all proposals made by the Developer. The City of Westminster voted to deny the Developer's request for water service on October 6, 1997. Given the City of Seal Beach's known opposition to the Bolsa Chica Planned Community, the Developer deemed it futile to request water service from the City of Seal Beach. Accordingly, the Developer has requested, and SCWC has agreed to provide water service to the Bolsa Chica Planned Community. . A copy of the March 12, 1997 System Operation and Maintenance Agreement (°1997 Service Agreement") between SCWC and the Developer is attached as Exhibit B. SCWC will provide the water supply to this new development from the contributed facilities and existing sources in its West Orange County System. The 8 water will be transported to the new development through the proposed 6.75 mile transmission pipeline, discharging into the on-site buried concrete water storage reservoir. Water will then be pumped from the on-site reservoir to the on-site distribution system. Pursuant to the 1997 Service Agreement, SCWC will be responsible for the continued operation and maintenance of the proposed water system. Ill. THE WEST ORANGE COUNTY SYSTEM EXTENSION _ SCWC proposes to extend its West Orange County System to serve the new development on the Bolsa Chica Mesa. . The water transmission pipeline has been proposed to achieve the basic objective of providing the Bolsa Chica Planned Community with a timely, reliable, long-term source of domestic water supply and distribution facilities to meet projected domestic water demands, fire flow and other requirements. A. The Water Transmission Pipeline 1. Description The pipeline will be an 18-inch diameter ductile iron pipe that has been sized to meet the domestic water demands resulting from development of the Bolsa Chica Mesa. No capacity is included in the pipeline design for additional daily uses by 9 others. The proposed water system conforms with the Commission's General Order No. 103, Rules Governing Water Service Including Minimum Standards for Design and Construction. 2. Location The water transmission pipeline will be located in the northwest region of Orange County, and will extend approximately 6.75 miles from the Bolsa Chica Mesa northward along Bolsa Chica Street and the Bolsa Chica Flood Control Channel to an interconnection with SCWC's system in the City of Cypress. The pipeline will be constructed in public rights of way in the cities of Huntington Beach, Westminster, Seal Beach and Cypress. In addition, the.pipeline will also traverse through portions of unincorporated Orange County and through rights of way under the jurisdiction of the California Department of Transportation, Orange County Flood Control District and Armed Forces Reserve Center in the City of Los Alamitos. 3. Construction The pipeline will be constructed in three segments. Segment 1 of the pipeline includes the entire portion of pipeline proposed to be constructed on the Developer's property or within the City of Huntington Beach. Segment 2 of the pipeline begins in the City of Westminster at the boundary with the City of Huntington Beach and continues north along Bolsa Chica Road; through the 1-405/SR-22 interchange; along 10 the Bolsa Chica Channel; then terminating just north of Lampson Avenue in the City of Los Alamitos. Segment 3 will join the northerly terminus of Segment 2 and continue northerly along the Bolsa Chica Channel; through the Los Alamitos Armed Forces Reserve Center golf course facility; and easterly along Orangewood Avenue to a point of interconnection with the existing SCWC system in the City of Cypress. All three segments of the pipeline will be constructed concurrently. Pending all permits and approvals, pipeline construction will 'commence in 1999. A listing of the permits and approvals required for construction of the pipeline is found in Table 2-1 of the accompanying Proponent's Environmental Assessment. 4. Cost Estimated costs for the water facilities are provided in Section 6 of the PWR. All water facilities necessary to serve the Bolsa Chica Planned Community— both on-site and off-site -- will be privately funded by the Developer but owned by SCWC. SCWC will classify these water facilities as contributed plant which is a reduction in the rate base calculation. There is no intent to recapture the cost of these facilities through the water rates charged to customers, either within or outside SCWC's Los Alamitos CSA. B. Source Of Supply A copy of SCWC's completed Water Supply Supplemental Questionnaire is 11 attached as Exhibit C. SCWC's total available water supply in its West Orange County System is 36,241 gpm. The total water supply requirement for the West Orange County System at full build out, including the demands of the Bolsa Chica Planned Community, is 30,262 gpm. As a result, SCWC has an apparent excess in water supply of 5,979 gpm. SCWC's water supply capabilities and contributed facilities will support the projected demand of the Bolsa Chica Planned Community, including sufficient water 4 _ supply to render adequate water service and fire protection service in.the area for which this Application is made. C. Rates To Be Charued The new customers in the Bolsa Chica Planned Community will be charged the same water rates as are then in effect for SCWC's Orange County District. A copy of SCWC's current general metered service tariff for the Orange County District is attached as Exhibit D. Currently, the quantity rates for all water delivered in the District is $1.101 per 100 cubic feet, and the service charge for a 5/8" by 318" meter, for example, is $7.15 per month. IV. ENVIRONMENTAL REVIEW UNDER CEQA The environmental review of the Bolsa Chica Planned Community is complete and final. Submitted concurrently under a separate cover, the 1996 Recirculated Draft 12 Environmental Impact Report for the Bolsa Chica Local Coastal Program, County of Orange, County Project Number 551 (the "Program EIR"), which includes the environmental assessment of the Bolsa Chica Planned Community. The Program EIR was certified in June 1996 by the County of Orange, the lead agency for the Project, and following appellate review, is now final. A copy of the County's Resolution certifying the final Program EIR is attached as Exhibit E. The Pr$graen EIR analyzed in detail the on-site water facilities to be-constructed within the Bolsa Chica Planned Community. See Program EIR, pp. 3-15, 4.16-2 through 4.16-3, and 4.16-15 through 4.16-18. The County of Orange certified that no significant short-term or long-term impacts have been identified for water service, as proposed in the Program EIR. The Program EIR, however, did not address SCWC's proposed water transmission pipeline. Therefore, SCWC proposes to supplement the Program EIR in order to make that environmental assessment of the Project complete with respect to the provision of water service. Accordingly, SCWC submits concurrently under separate cover its Proponent's Environmental Assessment ("PEA") of the water transmission.pipeline. SCWC believes that a Supplemental EIR is the proper method for assessing any possible environmental impacts associated with the water transmission pipeline and that the Commission should act as the "lead agency" for purposes of preparing the Supplemental EIR. As shown in SCWC's PEA, SCWC recommends that the Commission conclude that, through the incorporation of certain mitigation measures, 13 the construction and operation of the proposed water transmission pipeline will have no significant impacts on the environment. V. JUSTIFICATION FOR THE EXTENSION Under Section 1001, SCWC must show a need for its service, and that it has the resources, technical competence and financial viability to serve the Bolsa Chica Planned Community now and in the future. SCWC has made such a showing. First, no other water supplier is ready, willing and able to supply water to the new development. The Bolsa Chica Planned Community needs a source of water supply, and SCWC is willing to fulfill that need. Second, SCWC has sufficient resources to serve this new development. The adequacy of the supply necessary to serve both existing and proposed customers has been demonstrated in the Water Supply Questionnaire. Lastly, the technical competence and financial viability of SCWC to serve this new development cannot seriously be questioned. Moreover, SCWC's proposal to include this new development within its Orange County District is fair and reasonable. The Bolsa Chica Planned Development will be subject to the same tariffs and rates that now apply to SCWC's Orange County District, which have been determined to be reasonable by the Commission. The Developer will pay all costs associated with construction and installation of the water facilities required to serve the Bolsa Chica Planned Community, and will contribute these facilities to 14 SCWC, thereby avoiding any increase in the rates of current customers. Further, no significant environmental impacts or detrimental effects to the community or existing recreational and park areas are expected to occur as a result of SCWC's pipeline and extension of service to the Bolsa Chica Planned Community. Rather, a variety of community benefits will result from the new development. Accor8i"ngly, SCWC respectfully submits that the public convenience and necessity are served by SCWC's extension of its service territory to the Bolsa Chica Planned Community. VI. FORMAL MATTERS AND PROCEDURAL REQUIREMENTS This Application is brought pursuant to Section 1001 of the Public Utilities Code. SCWC proposes that this Application be categorized as a rate setting proceeding. The need for a hearing, the issues to be considered, and a proposed schedule can better be determined at a first prehearing conference, following the filing of protests, if any. Given the Developer's need to begin construction of the water facilities as soon as possible, SCWC respectfully requests that review of this Application be expedited. SCWC's legal name is Southern California Water Company, and its principal place of business is located at 630 East Foothill Boulevard, San Dimas, California, 91773. SCWC's main telephone number is (909) 394-3600. 15 The name, address, and telephone number of the person to whom communications regarding this Application should be addressed is: Susan Conway, Vice President - Regulatory Affairs Southern California Water Company 630 East Foothill Boulevard P.O. Box 9016 San Dimas, California 91773 (909) 394-3600 SCWC is a corporation duly organized and existing under and by virtue of the laws of the State of California and represents the consolidation, effective on December 31, 1929 upon the order of this Commission, of some twenty corporations which were formerly operated under the jurisdiction of this Commission as public utilities, together with subsequent acquisitions and additions. Its principal business is the production and distribution of water for domestic, industrial, municipal and other purposes. SCWC renders water service in various areas in the counties of Contra Costa, Imperial, Lake, Los Angeles, Orange, Sacramento, San Bernardino, San Luis Obispo, Santa Barbara and Ventura, and electric service in the vicinity of Big Bear Lake in San Bernardino County. A copy of SCWC's Restated Articles of Incorporation were filed with this Commission on July 10, 1996 as an exhibit to Application No. 96-07-015. SCWC's latest available Results of Operations for the Company overall, and for the Orange County District are attached as Exhibit F. 16 SCWC's most recent available Balance Sheet and Income Statement are attached as Exhibit G. A table illustrating the estimated operating results, including an estimate of the number of customers, revenues, expenses, depreciation and taxes in accordance with classification in the Commission's Uniform System of Accounts for the first, and fifth year of operation,-of the proposed system extension is attached as Exhibit H. - No transactions requiring the reporting of a material financial interest, as defined in General Order No. 104A, has occurred since the last Annual Report filed by SCWC, and except as reported therein, SCWC does not propose at present to become party to any transaction requiring a report of such material financial interest. A copy of this Application will be furnished to the City of Cypress, the City of Huntington Beach, the City of Los Alamitos, the City of Stanton, the City of Seal Beach, the City of Westminster, the Local Agency Formation Commission, the County Sanitation District of Orange County, and the Board of Supervisors of the County of Orange. 17 VII. PRAYER WHEREFORE, Southern California Water Company respectfully requests that the Commission issue an order: 1. FINDING that the public convenience and necessity requires the construction of a non-contiguous extension of SCWC's West Orange County System in its Orange Coenty District in order to provide water service to the Bolsa Chica Planned Community; 2. AUTHORIZING SCWC to construct a 6.75 mile water transmission pipeline in accordance with this Application; 3. AUTHORIZING SCWC to file a new tariff map to reflect the non- contiguous extension of its service territory to the Bolsa Chica Planned Community; 4. AUTHORIZING SCWC to charge such rates and tariffs in the Bolsa Chica Planned Community as are then in effect in its Orange County District; S. AUTHORIZING the treatment of the water facilities as contributed plant not in rate base, as set forth in this Application; and 18 6. GRANTING such other relief as the Commission deems reasonable and necessary. Dated: October 23, 1998 Sus . Conway, Vice President SOUTHERN CALIFORNIA WATYR COMPANY SF1:329738.2 19 VERIFICATION With respect to the within Application, .the undersigned certifies that she holds the position indicated below her name, that she is authorized to make this verification for and on behalf of said entity; that she has read the Application and knows the contents thereof; and that the same is true of her own knowledge and belief, except as to those matters which are herein stated upon her information or belief, and as to those matters, she believes them to be true. The undersigned declares under penalty of perjury that the foregoing is true and correct. Executed on October 23, 1998, in the City of San Dimas, California. B t7ltirs � G-�t Susan L. Conway Vice President, Regulatory Affairs SOUTHERN CALIFORNIA WATER COMPANY CERTIFICATE OF SERVICE I hereby certify that, pursuant to the Commission's Rules of Practice and Procedure, I have this day.seryed a true copy of Southern California Water Company's Application on all parties identified on the attached service list. Service was effected by placing the copies of properly addressed sealed envelopes and depositing such envelopes in the United States mail with first-class postage prepaid. Dated October 23, 1998. Lanell N. Copeland SOUTHERN CALIFORNIA WATER COMPANY DISTRIBUTION LIST ORANGE COUNTY DISTRICT City of Anaheim City of Santa Ana Water Public Utilities Dept. 20 Civic Center Plaza 201 So. Anaheim Blvd. Santa Ana, CA 92702 Anaheim, CA 92805 City of Seal Beach Brea Water Department '211 Eight Street City of Brea Seal Beach, CA 90740 #1 Civic Center Drive Brea, CA 92621 City of Tustin Water 300 Centennial Way City of Anaheim 4 - Tustin, CA 92680 - - P.O. Box 3222 Anaheim, CA 92803 City of Westminster 8200 Westminster Boulevard City of Buena Park Westminster, CA 92683 6650 Beach Boulevard Buena Park, CA 90620 East Orange County Water 185 N. McPherson Road City of Garden Grove Orange, CA 92669 13802 Newhope Street Garden Grove, CA 92643 Fullerton Water Department City of Fullerton Water 303 W. Commonwealth Avenue City of La Palma Fullerton, CA 92631 7822 Walker Street La Palma, CA 90623 Serrano Water Dist. Villa Park 18021 East Lincoln City of Orange Water Dept. Villa Park, CA 92667 189 South Water Orange, CA 92866 Yorba Linda Water District 4622 Plumosa Avenue Yorba Linda, CA 92686 SOUTHERN CALIFORNIA WATER COMPANY DISTRIBUTION LIST ORANGE COUNTY DISTRICT To the City Attorney and City Clerk of: City of Placentia City of Cypress 401 East Chapman Avenue 5275 Orange Placentia, CA 92670 Cypress, CA 90630 City of Seal Beach City of La Palma 211 8th Street 7822 Walker Seal Beach, CA 90740 La Palma, CA 90680 City of Stanton City of Los Alamitos 7800 Katella Avenue _ 3191 Katella Avenue Stanton, CA 90680 Los Alamitos, CA 90720 City of Yorba Linda City of Orange 4845 Casa Loma Avenue 300 E. Chapman Avenue Yorba Linda, CA 92686 Orange, CA 92666 To the County Counsel and to the County Clerk of: County of Orange County of Los Angeles 10 Civic Center Plaza 12400 East-Imperial Highway Santa Ana, CA 92702 Norwalk, CA 90650 SERVICE LIST City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 City of Seal Beach 211 8th Street Seal Beach, CA 90740 City of Westminster 8200 Westminster Blvd. Westminster, CA 92683 Local Agency Formation Commission 12 Civic Center Plaza Santa Ana, CA 92701 Board of Supervisors of the County of Orange 10 Civic Center Plaza Santa Ana, CA 92701 County Sanitation Districts of Orange County Admuustration Building P.O. Box 8127 Fountain Valley, CA 92728-8127 F � �..�° �.u'�t�A R `�• -�'` .�,s3-� *g � •4.4 � �`� � � ?�. ^^S_ ,�'e^- �d ^£ '�s�.��"'�Ed` 'a 3�3 SOUTHERN CALIFORNIA WATER COMPANY Revised Cal. P.U.C. Sheet No. 630 E. FOOTHILL BLVD. P. O. BOX 9016 SAN DIMAS, CALIFORNIA 91773-9016 Cancelling Revised Cal. P.U.C. Sheet No. Nil a,:, i r Lp f 1f W 9a 00 'rl. rate . II; -5200__ n TIARA OR N 5001 AV u 19 OH LL 5 s JAMES CIR K DR r ;r•.ry ,...._;,,,; --L1( OR ON ST L Cl cu DO � CIR = ALADDIK CIR D N GLENRO FS pp0 TORT i KENIL J W DR ; rt o •S�`� NNt,�I I � v ov L� ♦ i f♦ j I ` 1 I i I ` BOl!SA EKr i � i I j STA TE Area to be added h ♦ ♦ BEACH ISSUED BY Date Filed Advice Letter No. F.E. WICKS Effective Date Decision No. President Resolution No. Revised 2703-W SOUTHERN CALIFORNIA WATER COMPANY Cal P.U.C. Sheet No 3625 (WEST SIXTH STREET _' ' '� � Revised LOS ANGELES , CALIFORNIA 90020 I aADE'Lw RErITE '�F Cancelling Cal. P.U.C. Sheet No.AA D PALI <I Q I. . - c a ',E,t' _'--yAA�' .,._'a,•r,•-•. ^-t�... - ;.-ut- �•.:r:rq - IN ':="',:; ORIIVGE COUNTY DISTRICT ` .A m O �-; �� cT alsn� _ -J'L:c.•1 '¢`_ lW-i. ° r , - _ _ ? ,.. r�,•' - '"I = i -\�" nVxx,E SnQ`�SS fELI' �ORPICOS T •• -I-•�- Ir'lest Orange Svstem 0': _--lL!L' � _ - V v.l I.�.:Y IEN-F-a'uE,16G \I��'y' (ARSON-' �ne tee' ST Lqv Cult, "-----I,,°J -' _ LINCOLN R' sco s B!s oP G AV b ••: qq �' - -1 - �O:r• L•9Jr'.P _Ix 1219"' ;T i __ 11 NaP r=_,y c� ?i,< r�•:; i • �,,,,, Lv `i E�,j - a Indicates Existing _ / Q� .xl ;Nns N \ onre(5T, $ Ta5 . ist n = .5 `/ - - - 's•aC,- ~i• - vNt-L°J- - - -- _ ;_AF LEGFt r� 'JL�.50'_SI_ _ ____ CRD9 LEr-+.7 Service Area O _n ESwiRE CY aSUPaE' - aR[ `9 >, 3tt=o{n T - „ - o __-- - h'--�_+•��� .aOT "M - _aWNVA .rv=_ - _ _ _ -_- lal;��.r •J,y.a.._�uoRpotrd•rly-,NIN =1 `I_aC naREv� - _ C = _;LIVDAn -_ I,•n-E1Jaol J T Z>}Ro iT - ` i,•.- al= sI• �cl�l a _ '� C3 1� _ VD,.y l:.,r-,. id -'A>--ti- _ NI:EVW _ f -1 / �' _ - _'.y Z 224r• O c�.rty:.a v:nn �3 1V'-�SI t::rt wsr. c. 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Y vw,.' ..,.al .fsoo fir':.,�._' rl .,..Ir _r:",-=";st, _ - .wlc1. <�'t,. _ _ _ 1 o:Evs. zlI _I�--µ i" ] r y ^„o[R.BCB,= -tl/ Fq E. CI �I ml •�.. 4N W- _ / - .. cy ..` V uNOLR'C;R .(? lL' �• ?1/yF�al-. R¢!I w6991S�URG RI) _,-SL r•• stt. :ORAXGEV000 ^- ./ JRANG EA000 /;-/ H✓? NGfw D lsoo __ - __ - - I� ��Av 4a� _ ,•p.:...v me R /.a,r' R•P .,DRI _ .. �/ _ t } •_4�,•.'L t°f - - - '•va - - - i't1�s; uCOLa-T xari _¢JJ�D J�:jt�yOT ,Io" :F-_�.f• '- - '^••,.�.vL,.. 3 I, - -n --11'� I`�IuJn'Io :. ,`. 0% I^• fr u.t.,. ► ; _ - _ - -.yPI E I:_ ( I.� - cOEi^ ,o- _ - r.-�- --.��_- -1 - - - - -- - ?� II-�- i'r[.a. r:_ 'I ="' - .. - f •� .l r �atE NAmunseT ��I. _ _ +1rAm;: +. .�' r.• Il_ NWrq a-_ S t`J�VNFfET CFE If!ORA. .° C`s--1'_p..i.=-'-'�__ _ _`_ _ ,a I.MNSMar_-.V_u r�F _JrIA•t�M1RE - x�g-� zilDo ., ` "'RJ - I j Av / LSrt a�,n`Ire M R V✓1' - - ?9l.]a� � 5E'•�= 1'JGLGTA OR IL,',�•`. Ir.Ce-� NI r} rrl P ORiEIJ ___1 v,la ea al 'Ig '�� ri -.,�� .. � QI StA 5a OAaA.Av/ "rt" 0 1 a, -- . � I.. =saaon'cA ry __Lc NOfl 1� �- / .,le wvW - _ u: - _ -i I SHOWING TERRITORY WITHIN WHICH DULY -,- I :y H R � A I N Y A EST BL S EDA D EGULARL Fll T RIFF SV CD s. ;HA MAN•"ii:^ - - '- :-.='`^ rA �'�1' ^/wry - ` � //JJ I" - •-�'; - vANcuaRD �t �J St 'I�`" , '�+ - / SCHEDULES APPLICABLE TO WATERSERVICE 5 Yr D: V,r�a'r�^,I evai�ioa.rlRi rr / 'I _ J �..r.i.. „snDul - ..<Byy a I .>.,LL� si �y �`G5- or,;� ARE IN EFFECT. ftC g x Sim al N' .�A. �a� I L - o I° =tom rcri _ -[ u erTox oI6 JR u 31 r *fi•J lI / .. 11. Rtac=aAREa ,I LI' - BEL•,.AVF Sv-, - .ESA. -�' _W oApt�Alppa K_MP / - �; `L°-"1-�----5 N Y RRa-JA. :I - - - - - - LL 7UCf ER ����N 'UCa EP OLN w-•'. J / / •ECiLoCla' -9! :JJL./ -$� „EF ___ _ -_ .-1av1" - L'-.n - - � - _ _ _ t _ _ _ _ - __ -- _ _ _ _ ^Svy_v'' O 1 - d - 'LUME - �I- aLl. Thisma shall not be considered 6 the Public � 9= �r °,I,� z - ,_r�r-,^,._ zr� - P Y .- -rY P o ENGELpi �, p :ut- !4_/' / EA�NfR xlERc: L>v" at' Q tllit, omml n of the State f I I xl a� _ LJ, iif rn t DR ( 1 ' ,....:.xx -- _ _ _ U C5 C 55 O O CO O EO wu r,rr ,. a 'I cevrRD oN��-a-., p0 t - - F.r�'> =' �_ _. sue__.- __ _ _ ___ -� _ --_ M?o.r. __ _ *JI�,pAP50N ^1_ ;}-- ;5� o " any other public body as o final or co clu- z - 'o ems, -IF! -- - 3f -- -o^aJ m h al - determination n r establishment of the dedf- I¢ - NE' '1- Sive deter a o 0 oh - - =•i:i: �1 v i -E•t - - - x sE 1-:�, ,a fit. _ I - - Q lit 4 '` C n- JL E[N atJ l I,' - _ n I f- - _ service, or a portion thereof. . r of a fc o e- - - 1 ated area s e- .. a•r: c e 'o - E Y P t• `tM`[L ,r taK �f ;t;xaRtn eau tauE I JYer ~C'•'\•� Pna.m -.1=.a• - .7 :••e-:? - - \, a' 4 - wa• �I wI D ✓ - >. - -- ----- SAN DIEGO �RWY _ _�✓ >a-. L` .Oyil-1 (To bo Insowtod by Utility) o bo Inserted by Col. P.U.C.) Advice Le4@eP No. 676-W Date Filed 6n1 D v B CAVENEY Effective Decision No. Resom-ion No. • i ke r y SYSTEM OPERATION AND MAINTENANCE AGREEMENT THIS SYSTEM OPERATION AND MAINTENANCE AGREEMENT (Agreement) is entered into by and between SIGNAL BOLSA CORP., a California Corporation (SBC), owner of the lands of the Bolsa Chica Project herein defined and wholly-owned subsidiary of Koll Real Estate Group, Inc., a Delaware corporation (KREG), and SOUTHERN CALIFORNIA WATER COMPANY, an investor-owned utility (SCWC), on this l2th day of March, 1997, at San Dimas, California, with reference to the following facts and intentions: RECITALS A. SI •C is planning the construction of domestic water, reclaimed water and wastewater facilities to furnish water and.wastewater services to approximately 1,700 residential units, which will include both single-family detached homes and multi-family attached homes located in Orange County, commonly known as The Bolsa Chica Project (Project herein). B. The Project area of 230 acres is located in an unincorporated area generally contiguous to the City of Huntington Beach in Northwestern Orange County. The Project area overlies the Santa Ana Groundwater Basin and is surrounded by residential neighborhoods to the north. east and southeast in the City of Huntington Beach, and.by the Pacific Coast Highway and the Pacific Ocean to the southwest as shown in the attached Exhibit "A," which is incorporated by this reference C. The Project will be developed in three phases according to SBC's Bolsa Chica Phasing Plan (Phasing Plan) beginning in 1998. Build out of the Project is estimated to be 2004. D. SCWC is subject to the jurisdiction of the California Public Utilities Commission (CPUC) and furnishes public utility water service to its various districts throughout the state of California, including service to over 240,000 water customers within 75 cities and within 10 counties. E. SCWC has two customer service areas and four water systems within SCWC's Orange County District. SBC intends to connect the Project water distribution facilities to SCWC's West Orange County System Los Alamitos customer service area, with the connection point located within SCIA'C's service area boundary by a pipeline intertie (Pipeline Intertie herein), which will be installed from the intersection Orangewood and Valley View located in the City of Cypress, or such other point as mutually agreed to by the parties, to the Project site ("connection point" herein). SCWC has determined it has sufficient water to supply SBC's water requirements for the Project. Also, SBC has access to groundwater on site which is also a potential source of water for the Project. F. In addition to SCWC's obligation to supply water to the Project at the hydraulic gradelines and rates of flow as specified herein, SBC desires SCWC to provide administration, operation and maintenance of water, reclaimed :eater and wastewater services as a management 103410.1 6774.33 consultant/operator to the Project at guaranteed rates as specified in this Agreement. SCWC is willing to provide such services to SBC, not as a regulated utility, but as an independent contractor to SBC, consistent with the professional standards in the industry. G. SBC intends, in its discretion, to assign this Agreement to a mutual benefit corporation, which will be initially owned by SBC with shares of water and sewer service stock issued to homeowners with the sale of residences in the Project. SBC also intends to transfer ownership of the water, reclaimed water and waste water facilities to the mutual benefit corporation after construction of such facilities. NOW, THEREFORE, in consideration of the above, the parties agree as follows: 1. FACILITIES. SBC shall construct water, wastewater facilities, and in SBC's discretion; reclaimed water facilities for the Project (System) consistent with SCWC's standard design specifications and project requirements subject to SBC's written approval, section 2.6 below and subject to the requirements of governmental agencies having jurisdiction over the Project, provided that in the event of conflicting standards, the more stringent standards shall control. Construction of the System shall be accomplished in phases, consistent with the Phasing Plan and Project area, generally described as follows: 1.1 Water Facilities. 1.1.1 Obligation to construct water facilities. SBC shall, at its sole cost and expense, construct the water facilities necessary to obtain and distribute the quantity of water reasonably expected to satisfy the water quantity and quality demands of the Project. The parties intend that SBC shall construct the Pipeline Intertie from the Project to the point of connection at SCWC's designated transmission pipeline. SBC may, in its sole discretion, elect to construct water supply wells (Wells) to extract groundwater for use on the Project. 1.1.2 Construction of Water facilities. SBC's construction of all necessary water facilities shall include the Pipeline Intertie, and groundwater wells (if feasible), treatment equipment, reservoirs, a pump station and a domestic water distribution system for the Project. A reservoir and pump station will be constructed on the Project site to meet domestic water storage and fire protection requirements and to maintain system pressure to the on-site distribution lines. It is presently planned that a 5.0 million gallon reservoir (maximum) and a 15 cfs pump station (maximum) shall be constructed on-site to meet operational, fire flow and emergency storage requirements ' A system of three pumps will serve the water distribution system from the Pipeline Intertie and any Wells if prudent and feasible and meets all DOHS standards. The size of these facilities will be adjusted to meet actual Project needs. A further description of the Water Facilities is set forth in Exhibit "B" attached hereto, which specifies the hydraulic gradients, rates of flow, and maximum amount of annual water delivery required. 1 1.3 Dedication of Water Facilities to Mutual Water Company. All water facilities set forth in Exhibit "B" attached hereto and any other related or appurtenant facilities, right 2 103430 1 6774.33 r of ways and easements including but not limited to the Pipeline Interne, Wells, pumps, transmission lines, storage tanks and related facilities, (collectively "water facilities") shall be dedicated to the nonprofit mutual water company to be formed by SBC. 1.2 Wastewater Facilities. SBC shall design and construct, at its sole cost and expense, pump station(s) and sewer system to carry sewage flows to District 11 of the County Sanitation District of Orange County (CSDOC). The wastewater facilities shall be designed and constructed by SBC so that sewage from the Project area will be collected on-site and pumped to the CSDOC No. 11 Los Patos trunk sewer located on Los Patos Avenue next to the Project as defined in that certain agreement between KREG and CSDOC No. 11, dated October 13, 1991 A description of the wastewater facilities is set forth in Exhibit "C" attached hereto. 1.31 Reclaimed Water Facilities. SBC may design and construct, at its sole cost and expense, a transmission pipeline to the Orange County Water District (OCWD) for the provision of reclaimed water by OCWD to the Project and such other facilities for distribution of reclaimed water within the Project. Pursuant to an agreement presently in negotiation, the reclaimed water shall not be used for residential purposes. A description of the reclaimed facilities is set forth in Exhibit "D" attached hereto. 1.4 - Water Service. SCWC will supply water to the Project, without discrimination, on a basis substantially similar to other customers within its West Orange County System. Los Alamitos customer service area. However, SCWC's obligation to provide such water service to the Project is subject to the fulfillment of the express condition precedent by SBC as described below. 1.4.1 Express Condition Precedent to Obligation to Provide Water Service. Upon SBC's completion of construction of the water facilities and the Intertie Pipeline and connection to the SCWC transmission facilities, as evidenced by the recordation of a notice of completion (Condition Precedent), SCWC shall provide water service to SBC, without discrimination, at the Connection Point to serve the water demands of the Project. Unless and until SBC has satisfied the Condition Precedent, SCWC shall have no obligation to provide water service to the Project. If SBC has not satisfied the Condition Precedent within five years.of the date of this Agreement, SCWC shall be relieved of any obligation to provide water service and water facility management to the Project. 1.4.2 Supplemental water from Wells. SCWC may, in its sole discretion supplement the water service provided from its transmission facilities through the Pipeline Intertie with groundwater produced from the Wells. 1.4.3 SCWC's independent obligation to manage the SBC water facilities. SCVt'C will continue to manage the water facilities in accordance with section 2 below without regard to SBC's fulfillment of the Condition Precedent. However, if after five years from the date of this Agreement, SBC has not completed construction of the Pipeline Intertie, the Agreement shall be.subject to early termination by SCWC and subject to the liquidated damages status in section 3 103430.1:6774.33 4.2.3 below, except civil commotions, earthquakes, title waves or other natural casualty which would prohibit SBC with proceeding with the Project. 1.5 Water Shortage'Emergency. Nothing in this Agreement shall be construed to limit SCWC's authority to declare a water shortage emergency pursuant to Water Code Section 350 or to implement rules and regulations under the direction and approval of the CPUC. 1.6 Right-of-Way. Upon request by SBC, SCWC will exercise the power of eminent domain to acquire any right-of-way reasonably related to and required for the Pipeline Interne and any related facilities necessary for the System. SCWC shall exercise such right at the sole cost and expense of SBC, by and through right-of-way counsel, appraisers, engineers; acquisition agents, and necessary consultants (Consultant Team) as designated by SBC in writing, subject to !'CWC'S reasonable approval. SCWC shall exercise its best efforts to implement such eminent domain powers, with the due diligence, subject to timely performance by SBC and its Consultant Team. If SCWC is unable to exercise its eminent domain powers for reasons which include, but are not limited to, ownership of the pipeline from the intertie to the Project or any other prohibiting circumstance, SCWC and SBC shall use their best efforts to mutually resolve such impediment(s) to enable SCWC to exercise its eminent domain powers to accomplish construction of the pipeline intertie. 2. GENERAL MANAGEMENT SERVICES. Upon execution of this Agreement, SCWC shall perform any and all services reasonably necessary to furnish management services for the day-to-day operation of the System, to the extent constructed, in accordance with SCWC's rules and regulations and accepted industry standards. SCWC's management services shall include operation of the reclaimed water facilities if and when constructed. SCWC shall provide all qualified, trained and, as required, licensed and certified personnel, direct supervision, fully equipped vehicles, proper tools, equipment, fuels and various supplies to operate, maintain and repair the System Within sixty (60) days of the date of execution of this Agreement, SC%VC shall designate qualified water supply, water quality and wastewater personnel to provide management services under this Agreement. SBC shall have the right to reasonably approve the personnel designated by SCWC. In the event SBC disapproves any of the personnel designated by SCWC, SCWC shall have the right to appoint substitute personnel. The management services to be provided shall include, but are not limited to: 2.1 Operation. Daily operation of the System; sewer collection and transmission and water and reclaimed water transmission and distribution system operation with record keeping. equipment inspections, cross-connection control coordination, valve exercising program, water main flushing, service connection repair, repair of main breaks or leaks, testing and routine maintenance of meters, reading and logging electric consumption meters, obtaining permits for normal or routine operations; repair of customer meters; and monthly meter reading. If the Wells are constructed, water service may be supplied from both the Pipeline Intertie and the Wells, at such times and in such quantities as determined by SCWC, in its sole discretion, in accordance with good management standards. SCWC shall operate and maintain the System in reasonably the same manner in which it operates its own districts, subject to reasonable deviations to accommodate any special 4 103430 ! 674.33 requirements of the System and the other provisions of this Agreement including, but not limited to, sections 9, 10, 11, 12 and 13 below. 2.2 Customer Services. Customer services shall include but are not limited to rendering bills to all customers receiving System service; payment processing in a practical and acceptable manner; responding to customer inquiries on service, bills, leaks or other concerns; using all reasonable efforts to collect all bills; processing applications for new or transfer of service; investigation of complaints, and other reasonable and customary customer services in connection with the operation and management of the System. 2.3 Inventory and Materials. SCWC shall keep an inventory and warehouse adequate ruAteriAls for daily operations; water main pipe of all sizes and specifications, valves, service material, meter boxes, vaults and various other materials required for service connection, water and sewer main and general water and sewer system installation and repairs. 2.4 Sampling and Testing. SCWC shall perform routine water sampling and testing of the System. In the event non-routine sampling and testing is required by regulation, request or direction of agencies which have jurisdiction over the System operation, and SCWC deems it necessary to have analysis performed by an outside commercial laboratory, SCWC shall notify SBC in advance of the need to conduct such analysis through an outside laboratory and notify SBC of the cost of analysis. Non-routine sampling and testing costs shall be paid by SBC. 2.5 Emergency Response. SCWC shall provide and maintain twenty-four (24) hour on-call response to emergency calls or.customer inquiries; provide the System an emergency or natural disaster operations plan, maintain an emergency communications system, in addition to routine equipment, provide or have access to any and all equipment required to perform emergency repair to vital system equipment and water and sewer mains. 2.6 Phased Construction. In accordance with the phased construction and Phasing Plan of the Project, SBC shall annually submit to SCWC a plan and schedule of Project development for SCWC's engineering review. Following SCWC's engineering review, SCWC shall submit to SBC recommendations regarding the plan and schedule of Project development. After consideration of SCWC's recommendations, SBC _ shall incorporate SCWC's engineering recommendation as the parties mutually agree. SCWC shall subsequently and annually prepare and provide to SBC for approval a proposed schedule of management services for the System based on the schedule and plan of Project development. Following SBC's reasonable approval of SCWC's proposed management services for that year, SCWC shall continue to provide management services in accordance with the updated Project schedule and plans and section 2 of this Agreement In the event SBC disapproves any of SCWC's recommendations or proposed schedule of management services, the parties shall use their best efforts to mutually agree on an alternative schedule of management services. 5 3. COMPENSATION. 3.1 Charge for Services. Compensation for SCWC's management services shall be the revenues received by SBC for water service, consisting of the commodity cost, and service charges, and operation'and maintenance cost a_ set forth in section 6.2.1, for sewer service -s set forth in section 6.2.2, and reclaimed water service as set forth in section 6.2.3, if applicable. From these amounts, SCWC shall be responsible for the cost of operating and maintaining the System as set forth in the Agreement. In the event SBC constructs the reclaimed water portion of the System described in section 1.3, SBC and SCWC shall negotiate in good faith for additional compensation for SCWC's management of the reclaimed water system. 4 3.2 Monthly Statements. SCWC shall submit a monthly statement to SBC stating the amount paid to SCWC from the Operating Account as described in section 7, below, for services, itemizing amounts paid for other charges or expenses and providing a balance of the Operating Account. 3.3 Development Schedule and Minimum Revenue Guaranty. The Project's total number of units is estimated to be 1,700. The term "unit(s)" as used in this Agreement shall refer to the number of dwelling units to be constructed in the Project. This number could be changed depending on market conditions and final approval by government agencies with discretionary approval over the Project. "Total number of units" means that number of units finally authorized by such government agencies and vested in SBC/KREG according to law. In the event the total number of units is changed, the schedule can be adjusted so that each period has the same proportionate number of units as compared to the schedule set forth below. For purposes of this Agreement, the Project's estimated number of 1,700 units shall be built out (as determined b..- certificates of occupancy issued by the government agency with building permit jurisdiction over the Project) according to the following schedule: Year 1999 No. of Units 173 Year 2000 No. of Units 429 Year 2001 No. of Units 354 Year 2002 No. of Units 372 Year 2003 No. of Units 291 Year 2004 No. of Units 81 Total 1,700 Should SBC not build out the total number of units designated in the period ending in the years set out above, SBC will pay to SCWC the minimum service cost per dwelling unit as determined by the difference between the actual number of units built out and the designated number of units for the period at the rate determined for such period(s). Should SBC build units in excess of the designated amount for any period, the excess number shall be credited to the next succeeding period or periods. 6 101430 1 6774.33 3.4 Cost Reimbursement. SBC shall pay SCWC the sum of One Hundred Thousand Dollars ($100,000) upon the sale to a merchant builder or any other person or entity of the first parcel of Project land upon which units may be constructed as partial reimbursement for the cost and expenses incurred by SCWC in initiating management services under this Agreement. 4. TERM OF AGREEMENT. 4.1 Term. This Agreement shall commence upon the date of this Agreement (Effective Date) and continue for a period of twenty(20)years (the Initial Term), unless terminated earlier as expressly provided in this Agreement. SCWC and SBC may, by mutual agreement in writing, extend this Agreement after the Initial Term for successive five (5) year periods, under the same terms-end conditions contained herein. _ 4.2 Termination. 4.2.1 Ternvnation for Cause. Material Breach. Either party may terminate this Agreement for cause and pursue all legal remedies for breach, including liquidated damages described below, effective immediately upon written notice of such termination, based upon a material breach of this Agreement. For purposes of termination under this section, material breach is defined as follows: (1) SBC's failure to timely authorize SCWC's withdrawals from the Operating Account as described in section 7, below, for management services and expenses in operating and maintaining the System; (2) SBC's failure to maintain sufficient funds in the Operating Account, described in section 7, below, in order to provide for payment of management services and expenses, (3) SBC's failure to comply with any of SCWC's reasonable recommendations or instructions regarding the operation of the System or failure to provide SCWC with adequate information to perform its duties. The above noncompliance and/or failure to provide information must endanger the health or safety of employees of SCWC, SBC, System customers, or the general public and, in SCWC's sole judgment, require immediate corrective action to remove the alleged danger. SCWC and SBC must, however, do the following before such termination occurs (i) SCWC and SBC shall each provide the other with a written summary of the noncompliance or failure to provide information and the alleged health or safety problem (Written Summary), (ii) SCWC and SBC shall each be given a reasonable opportunity to respond and propose an alternative course of action to address perceived health or 7 103430 1 6774 33 safety problems; however, each party shall respond within forty-eight (48) hours of receipt,of the Written Summary; (iii) SCWC and SBC shall use their best efforts to address the health and safety problems and each other's concerns; and (iv) If SCWC and SBC are unable to resolve the dispute, the termination is effective two (2) weeks from the date of receipt of the Written Summary; (4) SCWC's chronic failure to timely and in a workmanlike fashion according to industry custom and practice in Southern California, perform the duties and obligations pursuant to this Agreement, including, but not limited to, Sections 2 through 2.6 and Sections 5. 6, ?, 9, 10, 12, 13, and 14 of this Agreement; (5) The acquisition of the System through condemnation or threat of condemnation or purchase and sale proceedings unless this Agreement is assigned (without material modification) through the condemnation proceedings and remains in full force and effect, in which case condemnation shall not result in a material breach; or (6) A further decrease in the number of units in the Project which makes it financially unfeasible, in SCWC's sole business judgment exercised reasonably, for SC%VC to provide the management services under this Agreement for the stated rate of compensation, unless SBC aerees to increase such compensation to make SCWC's provision of management services financially feasible. Upon termination, SCWC shall immediately relinquish to SBC and further provide to SBC or SBC's agents, all of SBC's assets of every nature or kind which are in the possession of SCWC, including, without limitation, supplies, equipment and customer account data. 4.2.2 LIQUIDATED DAMAGES AFTER SATISFACTION OF CONDITION PRECEDENT. ANY MATERIAL BREACH OF THIS AGREEMENT RESULTING IN TERMINATION UNDER SECTIONS 4.2.1(1), (2), (3), (5) or (6) after SATISFACTION OF THE CONDITION PRECEDENT SHALL BE DEEMED AN EARLY TERMINATION BY SBC AND SCWC SHALL BE ENTITLED TO RECEIVE AS ITS SOLE COMPENSATION, LIQUIDATED DAMAGES IN THE AMOUNT OF Five Hundred Thousand Dollars ($500,000). THE ABOVE LIQUIDATED DAMAGES HAVE BEEN AGREED BY THE PARTIES FOR ESTABLISHING A REASONABLE VALUE AND ADEQUATE COMPENSATION TO SCWC AS A RESULT OF EARLY TERMINATION BECAUSE ACTUAL DAMAGES ARE COSTLY, INCONVENIENT AND DIFFICULT TO DETERMINE WITH PRECISION GIVEN SCWC'S INABILITY TO ACCOUNT FOR INTERNAL FEES AND COSTS ASSOCIATED WITH PREPARATION AND CONTINUED COMMITMENT TO PROVIDE MANAGEMENT SERVICES. 8 1034 Y! 1 6774.33 4.2.3 LIQUIDATED DAMAGES PRIOR TO THE SATISFACTION OF THE CONDITION PRECEDENT ANY MATERIAL BREACH OF THIS AGREEMENT PURSUANT TO SECTION 4.2.1 ABOVE OR EARLY TERMINATION BY SCWC PURSUANT TO SECTION 1.4.0 ABOVE SHALL ENTITLE SCWC TO RECEIVE AS ITS SOLE COMPENSATION, LIQUIDATED DAMAGES IN THE AMOUNT OF BE ONE HUNDRED SEVENTTY-FIVE THOUSAND DOLLARS ($175,000). SUCH LIQUIDATED DAMAGES HAVE BEEN AGREED TO BY THE PARTIES FOR ESTABLISHING A REASONABLE VALUE AND ADEQUATE COMPENSATION TO SCWC AS A RESULT OF SUCH TERNIINATION BECAUSE ACTUAL DAMAGES ARE COSTLY, INCONVENIENT AND DIFFICULT TO DETERMINE WITH PRECISION GIVEN SCWC'S INABILITY TO ACCOUNT FOR INTERNAL, FEES AND COSTS ASSOCIATED WITH PREPARATION TO PROVIDE MANAGEMENT SERVICES. 5. CONVERSION. SBC, at its sole COST and absolute discretion, but subject to, including such cost in the customer rates, if reasonable, pursuant to the budget procedure, may, at any time, elect to waive its rights under this Agreement and request water service from SCWC on a basis similar in all respects to other customers within SCWC'S Orange County service area. Upon receipt of written notice from SBC, SCWC shall, thereafter, diligently pursue, in a timely manner, take all appropriate steps with the California Public Utilities Commission (CPUC herein) and all governmental agencies with jurisdiction to secure the right to provide water and sewer service to each unit within the project. Pending approval of such right, the provisions of this Agreement shall remain in effect. After securing the right to serve the Project from the CPUC, and SBC consents to the terms of service established by the CPUC, this Agreement shall terminate. SBC shall reimburse SCWC on a monthly basis for costs, expenses and fees incurred by SCWC in connection with obtaining or attempting to obtain CPUC approval for conversion. In particular, the parties agree that Section 2, General Management Services; Section 3, Compensation; Section 4, Term of Agreement; Section 6, Budget Rates and Charges; and Sections 7 through 14 shall terminate and no longer be prospectively enforceable for activities, acts, or omissions occurring after the effective date of SCWC securing the right to serve the Project. 6. BUDGET, RATES AND CHARGES. 6.1 Budget. SBC shall develop an operating budget for the System (Budget) which shall include, but not be limited to, the items set forth below to be supplied by the parties. The Budget will serve as the basis to establish the rates and charges to be billed to the customers for services from the System. SBC shall provide information to SCWC regarding mutual benefit corporation overhead, administration and engineering costs, system expansion costs, reserves for capital improvements, extraordinary capital requirements, and other items of cost for which it is responsible under the terms of the Agreement for SCWC's review and comment and other information that would assist in developing the Budget. Any obligations for payment of costs not expressly assumed by SCWC in this Agreement shall be paid by SBC. The operating year shall be calculated on a calendar year, except the first year shall be prorated commencing on the date this contract is executed. The Budget, including the detailed breakdown, for the first year shall be completed by SCWC and SBC within sixty(60) days of execution of this contract and each calendar 9 103430.1 6774 33 year thereafter, and shall include a reasonable estimate of such costs for each year of the life of the initial or remaining term of this Agreement in current dollars. Such estimates shall be made based on accepted standards of engineering and accounting practices in the seven southern counties of California. The Budget shall be based upon the information provided by SBC and SCWC, prior historical data regarding the System, extraordinary maintenance charges, reasonable reserves, emergency repairs, capital improvements, SCWC's general knowledge concerning operation of similar systems and such other information as reasonably applicable to the System and SCWC's compensation for management services set forth in Section 3 above. Pending adoption of the budget, the last preceding budget shall remain in effect until a new Budget is adopted by SBC. 6.2 Rates and Charges. Rates and charges for water and sewer service to customers shall be made up of the following components and such other components as mutually agreed to by the-parties in writing: - 6.2.1 Water. The rate for water service, whether water is supplied through the Pipeline Interne or from the Wells (if available), shall be and not exceed the currently CPL,'C approved rate for SCWC's West Orange System of its Orange County District Los Alamitos customer service area which is currently $1.08 per ccf commodity charge and $6.94 per 5/8" x 3/4" service charge per month both of which shall BE ADJUSTED FROM TIME TO TIIN1'-E to correspond with the CPUC approved rates and charges for SCWC's West Orange County System of its Orange County District Los Alamitos customer service area. 6.2.2 Sewer Service. The cost of sewer service shall be$4.00 per month per customer OR 20% OF THE WATER BILL, WHICHEVER IS GREATER. 6.2.3 Reclaimed Water Service. The cost of reclaimed water from the Orange County Water District plus compensation to SCWC for management of the reclaimed water facilities and service as determined pursuant to Section 3.1 above. 6.2.4 Guaranty. SCWC guarantees the rates for water service as set forth in Section 6.2.1 above and sewer service as set forth in Section 6.2.2 above, subject to increases or decreases as authorized by duly adopted tariffs by the CPUC for the West Orange System of SCWC's Orange County District Los Alamitos service area. 6.2.5 Additional Costs and Reserves. In addition to those described in sections 6.2.1 and 6.2.2, to be included in the rates and charges to the customer shall consist of items set forth in the Budget described in Section 6.1 above. Reserves for capital replacements and future improvements, regulatory compliance, sampling, testing and other costs reasonably required for the System which are the responsibility of SBC, as provided herein, except for the initial construction of the System, shall also be included in the rates and charges to the customer. 6.2.6 Adjustment. Rates and charges for water and sewer service shall be increased as reasonably required by a decrease in the number of Project units specified in Section 3.3 above in the budget process as mutually agreed by SBC and SCWC. 10 10143;) 1 6774.33 6.3 Adoption of Budget, Rates and Charges. SBC shall take such action as necessary to adopt the Budget and implement the rates and.charges as required by SBC's rules and shall provide SCWC with written notice of the effective date of the rates and charges to enable SCWC to commence billing System customers. 7. SYSTEM REVENUES AND EXPENSES. SCWC shall collect all customer payments for System rates and charges and deposit such funds into a separate bank account (Operating Account). SCWC shall pay all expenses and costs incurred by operating and maintaining the System from funds in the Operating Account including, but not limited to: (i) real property taxes and assessments levied or assessed against the System; (ii) franchise and business taxes imposed. upon or measured by revenues from the System; (iii) electric or gas power charges in operating the System; (iv)water purchase for delivery to the System, except water from the Well$ for which there is no SBC commodity or service charge; (v) reclaimed water purchase for delivery to the System if constructed; (vi) wastewater operation, costs and disposal fees; (vii) SCWC's fees and costs for operating and maintaining the System; and (viii) such other costs and expenses incurred in the normal operation and management of the System. In the event there are insufficient funds in the Operating Account to pay the above costs and expenses, SBC shall immediately deposit such additional funds to enable SCWC to make the necessary expenditures. 8. RESERVES. The approved Budget shall include a reasonable amount of reserve funds as reasonably necessary for emergencies, unscheduled maintenance and repairs, extraordinary maintenance, capital improvements (not including initial capital improvements, Section 11) capital replacement, PUC proceedings, and other similar costs and expenses. SCWC shall have the right to review and comment on the reserve amount and advise SBC if such amounts are unacceptable, in which event the reserve amounts shall be adjusted by mutual agreement. The reserve funds shall be placed in a separate interest bearing account (Reserve Account). Following written notice by SCWC to and written authorization by SBC, SCWC shall be entitled to transfer funds from the Reserve Account to the Operating Account to pay for any of the above-described extraordinary matters. In the event there are insufficient funds in the Reserve Account to pay for any of the above, SBC shall immediately deposit such additional funds to enable SCWC to. make the necessary expenditures. 9. EXTRAORDINARY MAINTENANCE. SCWC shall notify SBC, in writing, of repairs needed or nonscheduled maintenance (collectively Extraordinary Maintenance) which will by SCWC's estimate cost $20,000 or more. SCWC shall not accomplish such Extraordinary Maintenance unless directed by SBC in writing to perform such work. Upon receipt of SBC's written authorization to perform such work and transfer any necessary funds from the Reserve Account to the Operating Account as provided herein, SCWC shall cause such work to be accomplished. Nothing in this Agreement, however, shall be deemed to limit SBC's right to cause such Extraordinary Maintenance to be accomplished by a person other than SCWC in coordination with and approved by SCWC whose approval shall not be unreasonably withheld. In such event, SCWC shall provide SBC a statement of SCWC's direct charges including any engineering, supervision and inspection costs paid to SCWC from the Reserve Account and Operating Account for such Extraordinary Maintenance item. 11 103430 1:6774.33 10. EMERGENCY REPAIRS. In the event of an emergency involving any part of the System which in SCWC's judgment threatens the public health or safety, and if in SCWC's judgment, immediate action is required, SCWC shall have the right to perform, or cause to be performed, any reasonable work on the System as requested by the circumstances (whether repairs, maintenance or capital additions)regardless of the estimated cost, free from any reserve requirement set out in paragraph 8, above, or iron, any req;.:rement that the work be let by competitive bid. SCWC shall notify SBC as soon as possible as to the work completed and proposed to be completed as a result of such emergency threatening the public health and safety and of SCWC's estimate of the cost. Upon notification by SCWC of the emergency work, SBC shall have the right to order cessation of such work, if other appropriate means are available and acceptable to SCWC to nullify the public health and safety emergency. SBC shall immediately authorize a transfer of funds from the Reserve Account to the Operating Account for the actual reasonable total installed cost of such work, including SCWC's engineering overhead charge computed at SCWC's then current rate. 11. INITIAL CAPITAL IMPROVEMENTS. 11. 1 Initial Capital Improvements. Initial capital improvements to the System, excluding those capital improvements required for emergency repairs as described in Section 9, above, but including expansion according to the Phasing Plan, as described on Exhibits "B," and "C," and "D," shall be the responsibility and at the sole cost of SBC. 11.2 Future Capital Improvements Future capital improvements to the System including, but not limited to, service connection replacement, new tie-ins, replacement of customer meters, replacement of pipelines and equipment, and other capital improvements to the System shall be performed at the sole cost of SBC SCWC and SBC shall negotiate in good faith for additional compensation. for SCWC's management of future capital improvements to the System. 12. >`1ANAGEMENT REPORTS. SCWC shall provide SBC with monthly written reports describing the amount of invoice billings to System customers for rates and charges, funds collected by SCWC from System customers, expenses and costs paid by SCWC from the Operating and Reserve accounts, and such other information as SCWC deems appropriate to keep SBC reasonably informed concerning operation and management of the System. SCWC shall also provide to SBC an annual written report in a form suitable to both parties related to the operations and maintenance of the System. The report shall include, but shall not be limited to, summaries of Extraordinary Maintenance; capital improvement; service and complaint report with listing of customer complaints and inquiries, reason for customer contact and resolution of the matter; water quality analysis; sales reports showing number of accounts, water consumption and revenue by customer classification; accounts receivable showing billings and collections for the System; and any other report or information that is pertinent and relevant to the operation and maintenance of the System. 13. RECORDS. SBC shall have access to SCWC's books and records applicable to the System during normal business hours at the offices of SCWC's headquarters or appropriate local Orange County District office throughout the term of this Agreement. SBC may request the 12 1034:i' 1 67,74_33 production from SCWC's records at SBC's cost of such statements, invoices and other documents as may be reasonably necessary to support any charge, bill or cost itemized by SCWC pursuant to the provisions of this Agreement, including records of System customer billing transactions and Svstem collections. 14. INSURANCE. 14.1 Liability Insurance. SCWC shall procure and maintain in effect insurance at its own expense and furnish SBC with a certificate of insurance evidencing the insurance required for the term and duration of this Agreement with the following minimum types and limits: 14.1.1 Automobile. Automobile (vehicle) liability insurance providing coverage for owned, nonowned and hired autos, with coverage on a per occurrence basis for bodily injury, including death, of one or more persons, property damage and personal injury, with limits of not less than One Million Dollars ($1,000,000) per occurrence. 14.1.2 Comprehensive General Liability. Comprehensive general liability insurance, providing coverage on a per occurrence basis for bodily injury, including death, of one or more persons,property damage and personal injury, with limits of not less than One Million Dollars (S1,000,000) per occurrence. 14.2 Workers' Compensation. SCWC shall maintain statutory workers' compensation insurance covering its employees in performance of services.under this Agreement at its sole cost and expense. SCWC shall also require that any subcontractor carry similar coverage for its employees prior to carrying out any of the services related to this Agreement. 14.3 Certificate of Insurance. Prior to the performance of services under this Agreement and at any time subsequent, upon request by SBC, SCWC shall provide KREG with Certificates of Insurance evidencing the above coverages. Each Certificate of Insurance shall provide thirty (30) days' advance written notice to SBC of any material change or cancellation of insurance or its coverage that is required under this section. 15. INDEMNIFICATION. 15.1 By SBC. SBC shall indemnify, defend and hold harmless SCWC, its directors, shareholders, officers, agents and employees from and against any and all claims, demands, losses, costs, expenses, litigation, liabilities, damages, recoveries and deficiencies of any nature whatsoever, including interest, penalties and reasonable attorneys' fees and costs, asserted or recovered by others, for loss, damage or injury to person or property, including death, arising out of or in connection with any acts or omissions of SBC, its directors, officers, agents, consultants and employees in the design and construction of the System, customer claims (unless caused by the sole negligence of SCWC), customer rates, provision of water to or acceptance of wastewater from the Project and SBC's express written direction on System operation and management. In this regard, SCWC shall promptly notify SBC of the existence of any claim, demand or other matter to which 13 SBC's indemnification obligations would apply and shall give SBC a reasonable opportunity to defend the same at SBC's expense and with the counsel of SBC's own selection, provided that SCWC at SCWC's option may, at all times, participate and cooperate in the defense at SCWC's own expense. If SBC, within a reasonable time after written notice, fails to defend, SCWC shall have the right, but not the obligation, to under take the defense of, and to compromise or settle (exercising reasonable business judgment), the claim or other matter on behalf, for the account, and at the risk, of SBC. 15.2 By SCWC. SCWC shall indemnify, defend and hold harmless SBC, its directors, shareholders, officers, agents and employees from and against any and all claims demands, losses, costs, expenses, litigation, liabilities, damages, recoveries and deficiencies of any nature whatsoever including interest, penalties and reasonable attorneys' fees and costs, asserted or recovered by others, for loss, damage or injury to person or property, including death, arising out of or in connection with any acts or omissions of SCWC, its directors, officers, agents, consultants and employees in performing this Agreement. In this regard, SBC shall promptly notify SCWC of the existence of any claim demand or other matter to which SCWC's indemnification obligations would apply and shall give SCWC a reasonable opportunity to defend the same at SCWC's expense and with the counsel of SCWC's own selection, provided that SBC at SBC's option may, at all times, participate and cooperate in the defense at SBC's own expense. If SCWC, within a reasonable time after written notice, fails to defend, SBC shall have the right, but not the obligation, to undertake the defense of, and to compromise or settle (exercising reasonable business judgment), the claim or other matter on behalf, for the account, and at the risk, of SBC. 16. STANDARD PROVISIONS. 16.1 Recitals. The recitals stated at the beginning of this Agreement of any matters or facts shall be conclusive proof of the truthfulness and the terms and conditions of the recitals, if any, shall be deemed a part of this Agreement. 16.2 Notices. All notices, approvals, acceptances, requests, demands and other communications required or permitted, to be effective, shall be in writing and shall be delivered, either in person or by mailing the same by United States mail (postage prepaid, registered or certified, return receipt requested) or by Federal Express or other similar overnight delivery service, to the party to whom the notice is directed at the address of such party as follows: TO SIGNAL BOLSA CORPORATION Signal Bolsa Corporation 4343 Von Karman Newport Beach, California 92660 Attn: Ray Pacini Facsimile No. (714) 476-2075 14 103430 1 6774.33 With a copy to: Russell G. Behrens, Esq. McCormick, Kidman& Behrens 695 Town Center Drive, Suite 1400 Costa Mesa, California 92626-1924 Facsimile No. (714) 755-3110 TO: SOUTHERN CALIFORNIA Southern California Water Company WATER COMPANY Region II 630 East Foothill Blvd. San Dimas, California 91773 Attn: Floyd Wicks Facsimile (909) 394-0827 "'ith a copy to. Scott Slater Hatch and Parent 21 East Carrillo Street Santa Barbara, California 93101 Facsimile No. (805) 965-4333 Any communication given by mail shall be deemed delivered two (2) business days after such mailing date, and any written communication given by overnight delivery service shall be deemed delivered on (1) business day after the dispatch date. Either party may change its address by giving the other party written notice of its new address. Written authorizations (as distinguished from notices) may be given by facsimile electronic transmission. 16.3 Successors and Assign . This Agreement shall be binding on and shall inure to the benefit of the parties and their respective heirs, successors and assigns. Nothing in this Agreement, express or implied, is intended to confer on any person other than the parties or their respective heirs, successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 16.4 Assignability. This Agreement shall not be assignable by either party without the prior written consent of the other party, who shall have the sole discretion to consent or not to consent to any proposed assignment, except SBC may assign to a mutual benefit corporation composed of all of the landowners and homeowners within the Project, provided SCWC's rights and obligations shall not be unreasonably impaired by the assignment and SBC has executed as guaranty guarantying the mutual benefit corporation's performance under this Agreement in a form reasonably satisfactory to SCWC. Any attempted assignment without the approval of the other party shall be void. 16.5 Waiver. No waiver by any party of any of the provisions shall be effective unless explicitly stated in writing and executed by the party so waiving. Except as provided in the preceding sentence, no action taken pursuant to this Agreement, including, without limitation, any 15 103430 1:6774.33 m - gT` r � - 1 bus - rea F a s WNN File No. 615-4 WATER SUPPLY SUPPLEMENTAL QUESTIONNAIRE FOR OTHER THAN PUBLICLY OWNED OR MUTUAL.UTILITY This Supplemental Questionnaire is to be completed for the subdivider by the water utility serving the area, unless it is a publicly owned or a mutual utility or has been specifically authorized by the California Public Utilities Commission(CPUC),to certify that it has the ability to serve. One completed copy is for forwarding to the CPUC, 505 Van Ness Avenue, San Francisco, CA 94102 Attention: Water Utilities Branch ("Subdivision"as used in the following questionnaire means that the subdivision for which this Supplementtl Questionnaire is being prepared.) Water Supply Utility: Name: Southern California Water Company Address: 630 E. Foothill Blvd. San Dimas, CA 91773 Telephone No.: (909) 394-3600 Subdivision to be Served: Name: Bolsa Chica Planned Community Tract No. Vesting Tents Tire Tract 15460 R.E.No. Location: s/o Warner Ave.. n/o Coast Highway w/o Bolsa Chico Ave County: Orange Developer: Sienal Landmark Number of Lots: 1235 Number of Acres: 230 Number of Dwelling Units: 1235 1. Attach a map or sketch(to scale) which delineates the subdivision and which clearly shows that the subdivision is entirely within the certificated service area of the utility. 2. Demonstrate that an adequate supply of water for the entire system in which the subdivision is situated, as defined by General Order No. 103 of the CPUC, is available, with adequate fire flow,to meet the requirements of all existing customers,the fully developed subdivision and the anticipated growth during the period of the subdivision development. Show supporting data and conclusions. The subdivision is to be fully developed by 2005 (approximate date) -1- SUPPORTING DATA: A. WATER SUPPLY AVAILABi : AT PRESENT TO MEET THE MAXIMUM DAY DEMAND: Flow available from all sources,except distribution storage, on the day of maximum demand* . . . . . . . . . . . . . . . . . . . . . . . . 35,086 gpm (10,386 gpm wells and 24,700 gpm purchased water) From distribution storage,total discharge capacity ** . . . . . . . . . . . . . . . :. . . . . . . 1 155 gpm (0.175 * 6,600 gpm capacity) Total supply available . . . . . . . . . . . . . . . .. 36,241 gpm How many independent sources of supply are being utilized? . . . . . . . . . . . . . . . . . . . . . .. 22 (18 wells, 3 connections, 1 booster station) *During maximum use hours. _ **This is the lesser of(1) storage capacity divided by 240 minutes (4 hours)or (2) the discharge capacity and represents the use of storage during 4 hours of peak or near peak demand where one or more maximum days' storage are available. If less than one maximum day's storage is available,the resulting rate should be reduced by multiplying it by the ratio of the total storage to one maximum day's requirements. How many such maximum day's storage,or fraction thereof, are available? . . . . . . . . . . . . . . . 0.175 days, (based on 4.5 mg * 18,000 gpm MDD) NOTE: The water system must be capable of replenishing the storage lost on the peak day, or long weekend,over the intervening periods of below average water consumption. B. WATER SUPPLY REQUIREMENTS: (1) Total number of existing and potential customers: (a) Existing number of residence and business customers . . . . . . . . . 25,526 (As of 311198) (b) Vacant or unserved lots in existing filed tariff area , entitled to water service. Example: Undeveloped lots in previously approved subdivisions . . . . . . . . . . . . . . . 1,420 (284 acres * 5/per acre) (c) Number of customers in the fully developed applied for subdivision . . . . . . . .. . . . . . . . . 1,235 (d) (a) + (b) +(c) Total . . . . 28181 -2- (2) Required water supply for total residential and business customers: Q = N c f = (28,181) (35) (0.30) = 29.590 gpm (Insert figures used) Where, N = the total number of existing and potential residence and business customers. c = Gallons per minute(GPM),a water use variable depending upon whether the area is to be served at flat or metered rates and depending upon other factors such as area, experience, community, standard of living,climate,class of consumer, quality and cost of water and sewer facilities. Varies between 5 and 9 for flat rate service 4 and 2 and 5 for metered service,reflecting maximum day - domestic usage. f = A factor to reflect diversity which varies roughly as follows: For 10 Customers . . . . . . . . . . . . . . . . . 1.80 For 25 Customers . . . . . . . . . . . . . . . . . 1.33 For 50 Customers . . . . . . . . . . . . . . . . . .97 For . 100 Customers . . . . . . . . . . . . . . . . . .70 For 300 Customers . . . . . . . . . . . . . . . . . . .41 For 1,000 Customers . . . . . . . . . . . . . . . . . . .30 (Minimum) (3) Required water supply for existing and anticipated industrial, irrigation and public authority commitments, including those of the subdivision: No.of Maximum Service Demand Connestions (gpm) Industrial customers * . . . . . . . ... . . . 4 80 Irrigation Customers * . . . . . . . . . . . . 0 0 Public Authorities * . . . . . . . . . . . . . . 148 592 These connections are included in B(1)and B(2)for domestic supply only. Subtotal(if none, so state) 152 672 • If any of the maximum demands entered always occur during periods of off-peak system demand, indicate instead your estimate of the demand of each such class of service during the period of maximum system demand. -3- (4) Residential and business water supply requirements(Q from Item B(2)) . . . . . . . . . . . . 29.590 gpm Industrial, irrigation and public authority requirements(subtotal) from Item B (3) . . . . . . . . . . . . . . . . . . . . . . . . . 672 gpm Total domestic and industrial water supply requirements . . . . . . . . . . . . . . 30,262 gpm CONCLUSION: (1) Apparent excess or deficiency in water supply: (Maximum Day Requirements) (a) Total water supply available at presesnt(from Item A) . . . . . . . . . . . . . . 36.241 _ gpm (b) Total water supply requirements (from Item B (2)) . . . . . . . . . . . . . . . . . . 30.262 gpm (c) Apparent excess(or deficiency) (from Item B(2)) . . . . . . . . . . . . . . . . . . 5.979 gpm(Excess) (2) If a deficiency is apparent: Explain plans for meeting such deficiency fully, including a statement of the numbers,types and capacities of new water supply sources or storage facilities. Use additional sheets if necessary. -4- C. TOTAL FLOW REQUIREMENT: (Average daily requirement plus fire flow requirement, in gpm) (1) Fire Flow Required: 3500 gpm,as indicated in attached letter dated , from the applicable fire protection agency. The flow standards for public fire protection purposes, set forth . below,are those the Commission considers appropriate for application on an average statewide basis. However,the Commission recognizes that there are widely varying conditions bearing on fire protection throughout the urban, suburban,and rural areas of California. Therefore,the standards prescribed by the local fire protection agency or other prevailing local governmental agency will govern. Such local flow standards shall be provided whether greater or lesser than those set forth below. Land Use Minimum Flow a. Rural, residential with a lot density of two or less per acre,primarily for recreational and/or part-time occupancy. 250 gpm b. Lot density of less than one single-family residential unit per acre. 500 gpm c. Lot density of one or two single-family residential unit per acre. 750 gpm d. Lot density of three or more single- family residential units per acre, including mobile home parks 1,000 gpm e. Duplex residential units,neighborhood business of one store. 1,500 gpm f. Multiple residential, one and two stories, light commercial or light industrial. 2.000 gpm g. Multiple residential,three stories.or higher,heavy commercial or heavy industrial. 2.500 gpm (2) Average daily requirement within the planned subdivision. Determine by calculating the average daily requirement per existing customer in gpm and multiply it by the number of customer connections(lots)planned in the subdivision. Average daily requirement(gpm) = 540 gRm ( Present annual consumption(gallons) ) Number of lots planned x (Existing customers x 365 days x 1,440 minutes) (1235 DU @ 0.44 gpm I DU) -5- (3) Total flow requirement: (a) Average daily requirement within subdivision = 540 gpm (b) Land use fire flow requirement of local fire protection agency = 3500 gpm (c) Minimum 2-hour total flow requirement= (a) + (b) = 4040 gpm CONCLUSION: (1) Apparent excess or deficiency in total flow: (a) If subdivision is to be served by extension of an existing system, _ attach plan of proposed water extension and state flow available from existing system for two hours, at point clearly designated on water system plan . . . . . . . . . . . . . . . . . . . . 972 gpm Indicate how determined: i. Fire flow test made on (date). X ii. Other. (Explain): Existing system will apply maximum day demand of 180% of average day demand to storage reservoir. On-site booster station will provide 170%Peak hour flow and fire suppression demands. (See below). (b) Flow available from new source of supply provided in support of this subdivision. Indicate on water system plan(well supply or connecation to other supply agency.) . . . . . . . . None gpm (c) Two-hour flow available from storage provided as part of this subdivision. (See Note **,paragraph A.) . . . . . . . . . . . . . . 5152 gpm (Fire demand plus peak hour) (d) Total 2-hour flow available to subdivision,(a) + (b) + m above (1) 5152 gpm (System supply not contributing) (e) Minimum 2-hour flow requirement in subdivision(par.C(3)©) . . . . . . . . . . . . . (2) 4040 gpm Excess(or deficiency)(1)-(2) . . . . . . . . . . . . . 1112 gpm excess -6- D. WATER SUPPLY SUMMARY: (1) Does water system meet or exceed: (a) Maximum daily requirements for a fully developed service area? X Yes No (b) Total flow requirements of the subdivision? X Yes No (c) If no to(a)or(b)above,explain: _ (2) Main Extension Agreement with (a) Is this a standard agreement_ Yes No If no,explain: (b) Date of agreement: E. LIMITATION OF EXPANSION: State the ratio of outstanding advance contract balances, including proposed new contracts,to total capital(as defined in Section A.2.a. of the Main Extension Rule)as of the most recent date available. Ratio: as of Date: F. ATTACHMENTS: (1) Map showing proposed subdivision in relation to service area. (2) Plan of proposed water extension and flow availability at identified point. (3) Letter from applicable fire protection agency stating their fire flow requirement. -7- VERIFICATTON I am the owner,coowner or an off ic,.:r ,n the corporation shown as the water public utility herein; I have read the statements in this document and know them to be true of my own knowledge,except as to the matters which are therein stated on information or belief,and as to those matters I believe them to be true. I declare under penalty of perjury that the foregoing is true and correct. Executed on 10/22/98 ,at _San Dimas , (Date) (City) California. Robert Lewis, Senior System Engineer Signature NOTARY PUBLIC Subscribed and sworn to, before me,this day of Notary Public in and for the City of ,County of State of California. (SEAL) Signature) -8- s <� .� a SOUTHERN CALIFORNIA WATER COMPANY Revised Cal. P.U.C. Sheet No. 4107-W* 630 E. FOOTHILL BLVD. P.O. BOX 9016 SAN DIMAS, CALIFORNIA 91773-9016 Canceling Revised Cal. P.U.C. Sheet No. 4056-W Schedule No. OCA Orange County District GENERAL METERED SERVICE APPLICABILITY Applicable to all metered water service. TERRITORY All or portions of the Cities of Cypress, La Palma, Los Alamitos, Placentia, Seal Beach, Stanton,Yorba-Linda and vicinity, Cowan Heights, Peacock Hills, Orange County. RATES Quantity Rates: For all water delivered, per 100 cu.ft...................................... $ 1.1-01 (1) Per Meter Per Month Service Charge: For 5/8 x 3/4-inch meter........................................................... $ 7.15 (1) For 3/4-inch meter........................................................... 10.85 For 1-inch meter............................................................ 17.95 For 1 1/2 inch meter.................................:.............:........... 35.70 For2-inch meter......................:..................................... 57.00 For3-inch meter............................................................ 107.35 For 4-inch meter........................................................... 178.20 For 6-inch meter............................................................ 357.80 For8-inch meter............................................................ 571.55 For 10-inch meter............................................................ 822.20 (1) The Service Charge is a readiness-to-serve charge which is applicable to all metered service and to which is to be added the charge for water used computed at the Quantity Rates. SPECIAL CONDITIONS 1. As authorized by the California Public Utilities Commission,all bills are subject to a one- time surcharge of$0.20. This charge offsets the Department of Health Services fee as billed to Southern California Water Company for fiscal years July 1, 1993 to June 30, 1997, and the Environmental Protection Agency's adopted National Primary Drinking Water Regulations for water testing and maintain standards under the Surface Water Treatment Rule. 2. To amortize the Income Tax Memorandum Account balance,a surcharge of$.001 per Ccf is to be added to the Quantity Rates shown above for a 36-month period beginning on January 1, 1996. 3. To amortize the New Employee Memorandum Account balance,a surcharge of$.002 per Ccf is to be added to the Quantity Rates shown above for a 36-month period beginning on January 1, 1996 4. All bills are subject to the reimbursement fee set forth on Schedule No. UF. ISSUED BY Date Filed Feb. 10. 1998 Advice Letter No. 1023-W F. E. WICKS Effective Date Mav 12. 1998 Decision No. 95-12-027 President Resolution No. W-4099 WSW ' -v" 1 RESOLUTION OF TEE SOARD OF SUPERVISORS ORANGE Comm, CALIFOPXU 2 June 18, 1996 3 4 5 6 On the motion of Supervisor S47vs duly seconded and carried, the following Resolution was adopted. 7 WHEREAS, the County of Orange ("County") elected to prepare a Local Coastal 8 Program in accordance with Section 30SOO of the California.Coastal Act .for the Balsa Chica Segment of the County,a North Coast Planning Unit for its Coastal 9 zone; 10 WHEREAS, Section 15265(a) (1) of the California Environmental Quality Act ("CEQA") Guidelines, 14 Cal. Code of Reg. 5 15265(a) (1) , provides "CEQA does not 11 apply to activities and approvals pursuant to the California Coastal Act (commencing with Section 30000 of the public Resources Code) by: Any local 12 government, as defined in Section 30109 of the Public Resources Code, necessary for the preparation and adoption of a local coastal program"; 13 WHEREAS, the County prepared a Local Coastal Program for the Balsa Chica 14 property, and in connection with the adoption of the Local Coastal Program, the County proposed the amendment of certain elements of its General Plan; the 15 adoption of a Zone Change/Planned Community Program; the adoption of a Community Profile Amendment; and an amendment to the Master Plan of Arterial Highways and 16 Master Plan of Countywide Bikeways; 17 WHEREAS, in connection with those actions, on June 15, 1993, in accordance with Section 15082 of the State Guidelines for Implementation of the California 18 Environmental Quality Act (State CEGA Guidelines) , 14 Cal. Code of Reg. 5 15082, the County published a Notice of Preparation that it was preparing an 19 environmental impact report on the proposed County actions for Salsa Chica and accepted responses on the Notice of preparation for a period of thirty (30) days 20 from June 15, 1993 to July 16, 1993; 21 WHEREAS, the County prepared Draft Environmental Impact Report 551, dated December 20, 1993 (the 01993 Draft SIR") , and which was circulated for public 22 review and comment for a period of sixty (60) days from December 21, 1993 to February 18, 1994; 23 WHEREAS, the 1993 Draft EIR was prepared to analyze a proposed project that 24 called for the development of an approximately 1,100 acres wetlands ecosystem that included approximately 1,004 acres of created and restored wetlands in the 25 Balsa Chica Lowlands that would be restored through reintroduction of ocean water through a non-navigable tidal inlet; the development of 4,286 residential 26 Resolution No. 96-463 27 Pub.Hrg.-Bolos Chica Local Coastal Program (LCP) Including Land Use Plan, 28 Implementing Program 6 Develop.Agree=. CEQA Resolution -1- 1 dwelling units, including a maxi.--um of 1,100 units in the Bolsa Chica Lowland; a regional park on Huntington Mesa; and the construction of a Bolsa Chica Street 2 Extension that would terminate near the intersection of Springdale Street; 3 WHEREAS, the- 1993 Draft EIR, also included consideration of a Modified Project Alternative that called for the development of an approximately 1,100 4 acres wetlands ecosystem without a new tidal inlet; the development of 3,070 residential dwelling units, all on Bolsa Chica Mesa; a regional park on 5 Huntington Mesa; and the construction of an arterial called the Cross-Gap Connector that would link Bolsa,Chica Street to Garfield Street; 6 WHEREAS, the County in response to comments on the i993 Draft EIR prepared 7 a Revised Draft Environmental Impact Report 551, dated August 22, 1994 (the 111994 Revised Draft EIR") , and which was circulated for public review and comment for 8 a period of forty-five (45) days from August 23, 1994 to October 6, 1994; 9 WHEREAS, the 1994 Revised Draft EIR analyzed a proposed.project which considered the County's proposed Draft Local Coastal Program, which eliminated 10 the Bolsa Chica Street Extension/Cross-Gap Connector and included the following elements: the restoration of the Bolsa Chica wetlands under one of two options 11 1 (Lowland Option A and Lowland Option B) , neither of which included a tidal inlet; residential development at a maximum density of either 2,500 units or 3,200 12 units; and a regional park on Huntington Mesa; 13 WHEREAS, Lowland Option A would provide for the development of a maximum of 2,500 residential units all on Bolsa Chica Mesa and acquisition and 14 restoration of the wetlands through a mitigation bank; and Lowland Option B would provide for the development of a maximum of 3,200 units on both the Bolsa Chica 15 Mesa and the Lowland, with wetlands restoration guaranteed by the 16 landowner/project developer with dedication of the wetlands to a public agency; WHEREAS, the 1994 Revised Draft EIR included consideration of 10 17 alternatives to the proposed project, including the No Project Alternative as required by CEQA, and the proposed project considered in the 1993 Draft EIR as 18 Alternative G; 19 WHEREAS, in light of a determination by the Keeper of the National Register regarding the eligibility of Battery 128 for listing on the National Register of 20 Historic Places, the County published a Supplement to the Revised Draft Environmental Impact Report, dated October 6, 1994 (the "1994 Supplement") , and 21 which was circulated for public review and comment for a period of forty-five (45) days from October 10, 1994 to November 23, 1994; 22 WHEREAS, .•the 1994 Supplement analyzes the potential environmental impact 23 of the proposed project on Battery 128, the World War II facility determined eligible for listing on the National Register; 24 WHEREAS, public review and comment periods were provided in conjunction 25 with the distribution of the Notice of Preparation, the 1993 Draft EIR, the 1994 i Revised Draft EIR, and the 1994 Supplement; 26 WHEREAS, the Planning Commission held a series of seven (7) public hearings 27 on September 21, September 28, October 12, October 24, November 9, November 21 28 -2- 1 and November 30 to receive and consider public testimony with respect to the Bolsa Chica project, the 1994 Revised Draft EIR and 1994 Supplement; 2 WHEREAS, as a result of a substantial number of public comments in support 3 of the tidal inlet, the Planning Commission. requested the EMA staff to modify the proposed Bolsa Chica Local Coastal Program to include a wetlands restoration plan 4 that included a tidal inlet; 5 WHEREAS, on November 30, 1994, the Orange County Planning Commission recommended to the Board of Supervisors pursuant to Planning Commission 6 Resolution 94-13, that the Board consider adoption of an alternative project that combined the wetlands Restoration Program that included a tidal inlet which was 7 described and analyzed in the 1993 Draft EIR, with the Lowland Option B Land Use Plan described and analyzed in the 1994 Revised Draft EIR; 8 WHEREAS, on December 14, 1994, the Board of Supervisors certified Final EIR 9 551 pursuant_to Resolution 94-1340, and adopted a Local Coastal-Program for Bolsa Chica (the "Bolsa Chica LCP") pursuant to Resolution 94-1341 which represented 10 the alternative project recommended by the Orange County Planning Commission and included the wetlands Restoration Program with a tidal inlet; 11 WHEREAS, on April 18, 1995, the Board of Supervisors approved a Development 12 Agreement ("DA 95-1") between the County and Signal Bolsa Corporation, a wholly owned subsidiary of Koll Real Estate Group (collectively "Landowner") , which 13 pertains to the Landowner's property in the Bolsa Chica LCP area; 14 WHEREAS, the County. directed.EMA to submit the Bolsa Chica LCP and DA 95-1 to the Coastal. Commission for approval; 15 WHEREAS, on January 11, 1996, the California Commission certified the Bolsa 16 Chica LCP, with suggested modifications, and approved the Development Agreement, with suggested modifications; 17 WHEREAS, pursuant to Public Resources Code Sections 30512 and 30513, and 18 Section 13544 of Title 14 of the California Code of Regulations, if the Coastal Commission suggests modifications to a local coastal program, the local 19 government with jurisdiction over the area governed by the certified local coastal program by action of its governing body, must, in order to have the local 20 coastal program deemed final and effective, acknowledge receipt of the Coastal Commission's resolution of certification including any terms or modifications .21 which may have been suggested for final certification; and must accept and agree to any such terms and modifications, and must take whatever formal action is 22 required to satisfy the terms and modifications; and must agree to issue coastal development permits for the total area included in the certified local coastal 23 program; 241 WHEREAS, the County has prepared an Amended Bolsa Chica LCP with Suggested Modifications (the "Amended Bolas Chica LCP") that revises the Bolsa Chica LCP 25 by incorporating the suggested modifications of the California Coastal 26 Commission; WHEREAS, the County and Landowner propose to amend DA 95-1 in conformance 27 with the suggested modifications of the California Coastal Commission, and the 28 1 -3- 1 County has prepared Amendment No. 1 to the Balsa Chica Development Agreement ("DA 95-1 Amendment") which incorporates the suggested modifications of the California 2 Coastal Commission, and has prepared Ordinance No.99t S to approve the DA 95-1 Amendment (the "DA Ordinance") ; 3 WHEREAS, the County has prepared Ordinance No. Mv"/ to adopt the Balsa 4 Chica Local Coastal Program Planned Community Regulations, Zoning Map and Statistical Summary in accordance with the Comprehensive Zoning Code of Orange 5 County (the "Zoning Ordinance") ; 6 WHEREAS, on January 17, 1995, the Balsa Chica Land Trust, City of Seal Beach, Gabrielino Shoshone Nation, Huntington Beach Tomorrow, and Sierra Club 7 filed an Amended Petition for Writ of Mandate against the Board of Supervisors of Orange County and the County of Orange (Balsa Chica Land Trust et al._ v. 8 County of Orange, Superior Court No. 741344) seeking to vacate and set aside the Board of Supervisors approval of Resolution 94-1340 certifying Final EIR 551 (the 9 "Legal Action") ; 10 WHEREAS, on February 16, 1996, the Orange County Superior Court rendered its decision in the Legal Action, and rejected all challenges to the review of 11 particular environmental impacts, but ruled that inclusion of the tidal inlet within the project after the close of the public comment period required 12 recirculation of the EIR and vacated Board of Supervisors Resolution No. 94-1340 certifying Final EIR 551 and adopting various findings pending full compliance 13 with CEQA as provided in the court's order; 14 WHEREAS, in accordance with the court's order, the County prepared a document titled, "1996 Recirculated Draft Environmental Impact Report" which was 15 a revision of the 1994 Revised Draft EIR 551 and provides an adequate and complete description and analysis of the Balsa Chica LCP approved by the Board 16 of Supervisors, which provided for the development of a maximum of 3,300 dwelling units overall in the LCP area, and consisted of two components, a "Mesa 17 Component" that proposes a maximum of 2,500 dwelling units on Balsa Chica Mesa, and regional park use on Huntington Mesa; and a "Lowland Component" that proposes 18 the development of a maximum of 900 residential units, and the expansion, creation and restoration of a 1,112.7 acre coastal wetland ecosystem, and the 19 construction of a non-navigable tidal inlet to maximize and enhance biological diversity and marine resources on-site (the "Balsa Chica Project") ; 20 WHEREAS, the County published the 1996 Recirculated Draft EIR 551 which 21 contains a complete description of the Balsa Chica Project approved by the Board of Supervisors, and. the environmental analysis for the tidal inlet, mitigation 22 measures associated with the tidal inlet, and alternatives to the tidal inlet; 23 1 WHEREAS, alternatives to the Balsa Chica project, including the tidal inlet, have been considered in a number of environmental documents prepared by 241 the County including the 1993 Draft EIR and the 1994 Revised Draft EIR, both of which are included in Final EIR 551, and the alternatives analysis for which are 25 incorporated into Chapter 6 of the 1996 Recirculated Draft EIR; i 26 WHEREAS, Chapter 6 of the 1996 Recirculated Draft EIR also incorporates by reference the alternatives analysis contained in the Draft EIS/EIR prepared by 27 1 the U.S. Army Corps of Engineers and the City of Huntington Beach in 1992; 28 -4- 1 WHEREAS, together these documents considered a total of thirty-seven (37) alternatives, including the proposed project described in the 1996 Recirculated 2 Draft EIR, the two Options A and B described in the 1994 Revised Draft EIR, a range of wetland restoration alternatives identified by the Romburg Tiburon 3 Center for Environmental Studies in a report commissioned by the California Coastal -Conservancy, and alternatives to the tidal inlet; 4 WHEREAS, Chapter 6 of the 1996 Recirculated Draft EIR analyzes in detail 5 ten (10) alternatives to the Balsa Chica Project, including alternatives with and without tidal inlets, the findings for which are attached to this Resolution; 6 WHEREAS, the 1996 Recirculated Draft EIR also incorporates an additional 7 study on water quality in the wetlands and nearby ocean waters that was prepared in September, 1995, during the course of the Coastal Commission's review of the 8 Balsa Chica LCP, and submitted that study to the Coastal Commission; 9 WHEREAS, the 1996 Recirculated Draft EIR also incorporates the suggested modifications related to the tidal inlet approved by the California Coastal 10 Commission and analyzed these suggested modifications in the 1996 Recirculated Draft EIR; 11 WHEREAS, the County on March 31, 1996, published a Notice of Availability 12 for the 1996 Recirculated Draft EIR, and circulated the 1996 Recirculated Draft EIR for public review for a period of forty-five (45) days from April 1, 1996 to 13 May 15, 1996; 14 WHEREAS, the County has reviewed the public comments that have been submitted on the 1996 Recirculated Draft EIR and has prepared responses to 15 comments; 16 WHEREAS, as a result of comments received on the 1996 Recirculated Draft EIR, a number of corrections, clarifications and revisions to sections of the 17 document were agreed to by staff and committed to as part of the Responses to Comments, for which an errata document itemizing each of these corrections, 18 clarifications and revisions has been prepared; 19 WHEREAS, in accordance with Section 15132 of the State CEQA Guidelines, the proposed Final EIR 551 consists of: 20 a. 1996 Recirculated Draft EIR, dated March 21, 1996, and all 21 appendices thereto; 22 b. Comments and Responses to Comments on the 1996 Recirculated Draft EIR; 23 C. Errata Document prepared for the 1996 Recirculated Draft EIR; 24 d. Supplement to 1994 Revised Draft EIR 551, dated October 5, 1994; 25 e. Comments and the Responses to Comments on the Supplement to 1994 261 Revised Draft EIR 551; 27 28 -5- 1 f. 1994 Revised Draft EIR 551, dated August 22, 1994, and all appendices thereto; 2 g. Comments and the Responses to Comments on the 1994 Revised Draft EIR 3 551; 4 h. Errata sheet to the 1994 Revised Draft EIR; 5 i. 1993 Draft EIR 551, dated December 20, 1993, and all appendices thereto; 6 j . Comments and the Responses to Comments on the 1993 Draft EIR 551; 7 k. A list of persons, organizations, and public agencies commenting on 8 the 1996 Recirculated Draft EIR, the Supplement to the 1994 Revised Draft EIR, the 1994 Revised Draft EIR, and the 1993 Draft EIR; 9 1. a- All attachments and documents incorporated by reference identified 10 in items a, through k. above. 11 WHEREAS, appropriate mitigation measures have been identified to mitigate the effects of the project described in Final EIR 551, and are set forth in the 12 revised Mitigation Monitoring Program which incorporates all of the project design features, standard conditions and mitigation measures identified for the 13 Bolsa Chica Project described and analyzed in the 1996 Recirculated Draft EIR, and incorporates the suggested modifications of the California Coastal 14 Commission; 15 WHEREAS, the Board of Supervisors has fully considered and reviewed the 1996 Recirculated Draft EIR, the Comments, Responses to Comments received on the 16 1996 Recirculated Draft EIR, and the Errata Document prepared for the 1996 Recirculated Draft EIR, and has listened to and considered the public comments 17 that were presented to it at all of the public hearings held on this project, and has determined after review and consideration to reconfirm its decision to 18 approve the Bolsa Chica LCP, except as modified by the Coastal Commission's suggested modifications; 19 WHEREAS, the Orange County Planning Commission on June 4, 1996, by 20 Resolution 96- Of , found pursuant to CEQA that proposed Final EIR 551 constitutes adequate environmental documentation for the Amended Bolsa Chica LCP, 21 the DA 95-1 Amendment, the DA Ordinance,- and the Zoning Ordinance, and is complete and adequate and fully complies with all requirements of CEQA, the State 22 CEQA Guidelines, and the County's environmental analysis procedures, and recommended that this Board certify proposed Final EIR 551; 23 WHEREAS, Section 21081 of the CEQA Statute and Section 15091 of the State 24 CEQA Guidelines require that this Board of Supervisors make one or more of the following findings, set forth in Section 21081 of the CEQA Statute, prior to 25 approval of a project for which an EIR has been prepared identifying one or more significant effects of the project, together with a statement of facts -in support 26 of each finding: 27 28 -6- 1 (1) Changes or alterations have been required in, or incorporated into, the project which mitigate or avoid the significant effects on the 2 environment. 3 (2) Those changes or alterations are within the responsibility and jurisdiction of another public agency and have been, or can and 4 should be, adopted by that other agency. 5 (3) Specific economic, legal, social, technological, or other considerations, including considerations for the provision of 6 employment opportunities for highly trained workers, make infeasible the mitigation measures or alternatives identified in the 7 environmental impact report. 8 WHEREAS, Section 15093 (a) of the State CEQA Guidelines requires this Board of Supervisors to balance the benefits of a proposed project against its 9 unavoidafa e-environmental risks in determining whether to approve the project; 10 WHEREAS, Section 15093 (b) of the State CEQA Guidelines requires that, where the decision of this Board of Supervisors allows the occurrence of significant 11 effects which are identified in an EIR, but are not at least substantially mitigated, the Board of Supervisors must state in writing the reasons to support 12 its action based on the Final EIR or other information in the record; 13 WHEREAS, Section 21091.6 of the CEQA Statute requires that where an EIR has been prepared for a project for which mitigation measures are adopted, that a 14 mitigation monitoring or reporting program be adopted for said project; 15 NOW, THEREFORE, BE IT RESOLVED THAT: 16 1. The Orange County Board of Supervisors has reviewed and considered the Final EIR 551 (State Clearinghouse No. 93-071064) , including the 1996 17 Recirculated Draft EIR, the Comments and Responses to Comments received on the 1996 Recirculated Draft EIR and the Errata document; 18 2. The Final EIR 551 has been and will be on file with the County of 19 Orange, Environmental Management Agency, Environmental Planning Division, 300 North Flower Street, Room 321, Santa Ana, California 92702. 20 3. This Board has reviewed Final EIR 551 and finds that it is complete 21 and contains all information required by Section 15132 of the State CEQA Guidelines, and has been completed in compliance with CEQA. 22 4. This Board has reviewed all notices published pursuant to CEQA and 23 finds that the Final EIR was prepared in compliance with the requirements of CEQA and the State CEQA Guidelines. 24 S. This Board finds that Final EIR 551 has identified all significant 25 environmental effects of the Amended Bolsa Chica LCP, the DA 95-1 Amendment, DA �. 26Ordinance and Zoning Ordinance. 6. This Board finds that Final EIR 551 has analyzed a range of 27 reasonable alternatives to the project, or to the location of the Bolsa Chica 28 -7- 1 Project, as set forth in the "Sts-zement of Findings and Facts in Support of The Balsa Chica Project Local Coastal Program and Related Discretionary Actions, " 2 attached hereto as Exhibit A, and made a part hereof; 3 6. This Board adopts the findings set forth in Section 21081 of CEQA and Section 15091 of the State CEQA Guidelines with respect to each significant 4 environmental effect identified in Final EIR 551, and each alternative considered in Final EIR 551, and the explanation of its reasoning with respect to each such 5 finding set forth in the document entitled, "Statement of Findings and Facts in Support of The Balsa Chica Project Local Coastal Program and Related 6 Discretionary Actions, " attached hereto as Exhibit A, and made a part hereof. 7 7. This Board finds that although Final EIR 551 identifies certain significant environmental effects that may occur if the Amended Balsa Chica LCP, 8 the DA 95-1 Amendment, the DA Ordinance, and the Zoning Ordinance are approved, all signi:f icant effects that can feasibly be mitigated or avoided have been 9 reduced to an acceptable level by the imposition of Project Design Features, Standard Conditions or Mitigation Measures, all of which have been identified and 10 set forth in Final EIR 551, and described in Exhibit A, and made a part hereof, and all of which are hereby specifically adopted by this Board to mitigate the 11 environmental impacts of the proposed project. 12 S. This Board finds that the unavoidable significant environmental effects of Amended Balsa Chica LCP, the DA 95-1 Amendment, the DA Ordinance, and 13 Zoning Ordinance, as identified in Exhibit A, that have not been reduced to a level of insignificance have been substantially lessened in their severity by the 14 imposition of the mitigation measures identified in Exhibit A. This Board finds that the remaining unavoidable significant impacts are clearly outweighed by the 15 economic, social, and other benefits of the Amended Balsa Chica LCP, the DA 95-1 Amendment, the DA Ordinance, and Zoning Ordinance, as set forth in the Statement 16 of Overriding Considerations, attached hereto as Exhibit B and made a part hereof. 17 9. This Board adopts the Statement of Overriding Considerations, 18 attached hereto as Exhibit B, which supports and justifies approval of the Amended Balsa Chica LCP, the DA 95-1 Amendment, the DA Ordinance, and Zoning 19 Ordinance notwithstanding certain unavoidable significant environmental effects which cannot feasibly be substantially mitigated. 20 10. This Board finds that the Mitigation Monitoring and Reporting Program 21 attached hereto as Exhibit C establishes a mechanism and procedures for implementing and verifying the implementation of and compliance with the Project 22 Design Features, Standard Conditions and Mitigation Measures pursuant to Public Resources Code.. Section 21081.6, and adopts the Mitigation Monitoring and 23 Reporting Program. 24 11. This Board finds that pursuant to Section 711.4 of the California Fish and Game Code, the Proposed Balsa Chica Project is subject to required fees 25 as it has been determined that impacts to wildlife resources may result from the 26 project. 12. This Board finds that Final EIR 551 reflects the independent review 27 and judgment of the County of Orange. 28 -e- 1 13. This Board finds that Final EIR 551 serves as adequate and appropriate environmental documentation for the Amended Bolsa Chica LCP, the DA 2 95-1 Amendment, the DA Ordinance, and Zoning Ordinance. 3 14. This Board of Supervisors hereby certifies Final EIR 551 as complete and adequate, and fully complies with the requirements of the CEQA Statute, the 4 State CEQA Guidelines, and the County's environmental analysis procedures. 5 6 7 8 9 10 11 . 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -9- 1 2 3 4 Cha an of the Board of Supervisors 5 SIGNED AND CERTIFIED THAT A COPY OF THIS DOCUMENT HAS BEEN DELIVERED 6TO THE CHAIRMAN OF THE BOARD 7 1 KATHLEEN E. GOODNO 8 Acting Clerk of the Board of Supervisors 9 County of Orange, California 10 AYES: SUPERVISORS JAMES W. SILVA, MARIAN BERGESON, DONALD J. 11 SALTARELLI, WILLIAM G. STEINER AND ROGER R. STANTON 12 NOES: SUPERVISORS NONE 13 ABSENT: SUPERVISORS NONE 14 W. STATE OF CALIFORNIA ) > ;a 15 ) ss. ° " W 16 COUNTY OF .ORANGE ) � � v Ica 17 I, KATHLEEN E. GOODNO, Acting Clerk of the Board of Supervisors „ o 18 of Orange County, California, hereby certify that the above and 19 foregoing Resolution was duly and regularly adopted by said Board at a 20 regular meeting thereof held on the 18th day of June, 1996, and passed 21 by a unanimous vote of said Board. 22 IN WITNESS WHEREOF, I have hereunto set my hand and seal this 23 18th day of June, 1996. 24 25 KATHLEEN E. GOODNO N Acting Clerk of the Board of Supervisors 26 of Orange County, California N N 27 O ® 28 -10- � - - - �5x z.� � x. -� 9 '..11 '�,�s'x '..�se� A$§ � :$s' S#sxk- �_�-� `�.a.-.`:y� � � ���?".K° •` ��;i-sue .','� :��,h�'",_i �� ��r`""dt..'=E,...-' _±sue i@�y �kt � a�-� ��.�. Z-�>: t,, SOUTHERN CALIFORNIA WATER COMPANY Summary of Earnings -12 Months Ending August 1998 CPUC ORANGE COUNTY TOTAL UTILITY WUDF Recorded Recorded ACCT ------------ ----:----- 615.00 OPERATING REVENUES $19,083.1 $148,169.1 OPERATION EXPENSES 704.00 Purchased Water $4,503.4 $32,430.5 704.02 Bal Acct Provision ($178.1) ($645.2) 726.00 Purchased Power $982.9 $12,340.6 735.00 Pump Taxes $1,792.0 $6,858.2 TOTAL SUPPLY EXPENSES $7,100.3 $50,984.2 REV LESS SUPPLY EXPENSE $11,982.8 $97,185.0 744.00 Chemicals $138.1 $974.4 773.10 Allocated Cust.Exp Labor $217.8 $1,349.0 773.20 Allocated Cust.Exp Other $172.1 $1,062.8 773.00 Common Cust Account $58.9 $220.6 773.2e- hostage $0.0 $0.1 775.00 Uncollectibles $32.8 $655.7 780.00 Operation Labor $777.7 $6,176.0 781.00 All Other Op Exp $496.0 $3,154.9 TOTAL OPERATION EXPENSE $8,993.7 $64,577.6 787.00 Maintenance Labor $239.6 $2,433.9 788.00 All Other Maint Exp $531.7 $3,849.7 789.00 TOTAL MAINT EXPENSES $771.3 $6,283.6 790.00 TOTAL O&M EXCL A&G $9,765.0 $70,861.2 792.00 Off Supplies&Expense $75.0 $1,539.3 793.00 Property Insurance $0.0 $92.3 794.00 Injuries&Damages ($6.2) $317.4 795.00 Pension&Benefits $24.6 $304.2 796.00 Business Meals $3.0 $40.4 797.00 Regulatory Comm Exp $264.4 $2,025.4 798.00 Outside Services ($7.2) $835.7 799.00 Miscellaneous $2.0 $80.9 799.10 Alloc General Office Labor $1,197.2 $3,377.5 799.20 Alloc General Office Other $2,028.8 $9,493.6 805.00 Oth Maint-Gen Plant $24.7 $309.1 811.00 Rent $44.7 $902.9 812.00 A&G Exp Capitalized $0.0 ($296.2) 815.00 A&G Labor $181.8 $4,295.9 TOTAL ADM&GEN EXPENSES $3,832.8 $24,855.4 503.00 DEPREC&AMORT EXPENSE $1,425.5 $11,404.0 507.10 Property Taxes $274.9 $3.279.0 507.20 Payroll Taxes $88.1 $929.2 507.30 Local Taxes $237.8 $1,545.9 507.40 TOTAL TAXES NOT ON INCOME $600.7 $5,754.1 820.00 TOTAL EXP EXCL INC TAX $15,624.0 $111,374.4 825.00 NET OP REV BEF INC TAX $3,459.1 $36,794.7 INCOME TAXES State Income Taxes $142.2 $2,036.0 Federal Inc Taxes $783.7 $9,204.9 TOTAL INCOME TAXES $925.9 $11,241.0 TOTAL OPERATING EXPENSES $16,549.9 $122,615.5 NET OPERATING REVENUE $2,533.2 $25,553.7 RATE BASE $36,319.4 $290.247.5 RATE OF RETURN 6.97% 8.80% AUTHORIZED RATE OF RETURN 9.27% 9.27% t� � '^t��!',u�ar+ }!t!�,r��'?+. 'rw€., A ✓ as� �. # r��t rd �i a 4d t r ' tl'��•�r�� �zru�^,�4 �^t� r�r '°� t° al' � '�,. :�r t "��'�• �* t �v � �.� t e 3-: :}r+k r�t''t{ci�. r .,s9y;t 3� t �,x fs.��} a s R3;" ��6 ,��'� a° � �. ,44 Ps � § wUh r��aa���t �'+y�s � � ✓w� � '�� 5 a ?�. �x as �z� #�+f {�� x Yw#',,try'• ;i .�a�,� ��w,y er, f a!§' ! g;Q� rx 1 � � �3��. 's dr a ux o-�'r�u ,� � ,�s rk! ��� � !�',� ��� .�. w ��� ,F.;'„aS?�a.�t '�Y ...un� ,ka4a.'fi...c..;�,�rad+`.t:, .�.,a a?�.�:':+��.�.,"�^n L'� '�i,,,�'�.5�..�•' w �.a � Ct"�R�,'07„�a..,.,r,:.t SOUTHERN CALIFORNIA WATER COMPANY BALANCE SHEETS June 30, June 30. June 30, June 30, 1998 1997 1998 1997 fin thowendO fin thousands) ASSETS CAPITALIZATIO4,AND LIABILITIES UTILITY PLANT,at cost CAPITALIZATION Water..................................................................... 455.915 415,926 Common shareholders'equity........................................ 149,974 147,031 Electric.................................................................... 34,190 33.788 Preferred shares not subject to mandatory 490.105 449,092 redemption requirements............................................. 1,800 1,800 Less-Accumulated depredation...........................:..... (131,9271 1120,4911 Preferred shares subject to mandatory 358.178 329,201 redemption requirements............................. Construction work in progress.................................... 39,391 37.482 Long-term debt............................................................ 130,772 111.321 397,569 360,683 202.780 280,432 OTHER PROPERTY AND INVESTMENTS Other physical property,net....................................... 504 515 CURRENT LIABILITIES Mutual water companies and other............................. 831 759 Notes payable to banks................................................. 18.000 14,000 1.335 1,274 Current maturities of long-term debt and CURRENT ASSETS preferred shares to be redeemed within one year............ 231 191 Cash and cash equivalents......................................... 1.471 569 Accounts payable........................-................................ 11.996 11.857 Accounts receivable-Customers,net of reserves Taxes payable.............................................................. 5.883 0,490 of 408 in 1998 and 269 in 1997............................. 7.084 10.282 Accrued interest........................................................... 1,805 1.809 Other.................................................................... 3,901 1.615 Other.......................................................................... 7,569 8.243 Unbilled revenues..................................................... 9,314 10,477 45.484 42,590 Materials and supplies,at average cost....................... 1,287 1,379 Prepaymente............................................................ 4,741 4,476 Supply cost balancing accounts.................................. 5.527 4.182 Accumulated deferred income taxes-net.................... 4,351 4,372 OTHER CREDITS 38,276 37,352 Advances for construction............................................. 54,258 54,812 DEFERRED CHARGES Contributions in aid of construction................................. 32,441 28.074 Unarnortized debt expense and redemption Accumulated deferred income taxes-net....................... 44.054 41.713 premium................................................................ 4.210 4,292 Regulatory tax-related liability........................................ 1,928 1,973 Regulatory tax-related asset........................................ 21.744 22.795 Unamortized investment tax credits................................ 3.201 3,292 Other...................................................................... 1,479 671 Other.......................................................................... 467 381 27,439 27.758 136,349 130.045 464,019 433,067 484.619 433,067 2 SOUTHERN CAUFORNIA WATER COMPANY STATEMENTS OF CAPITALIZATION June 30, June 30, June 30, June 30. 1998 1997 1998 1997 (in .Ueff .) tin the a"-) COMMON SHAREHOLDERS'EQUITY LONG TERM DEBT i, Common shares,$2.50 par value Outstanding 8,957,671 in 1998 Other Long-term Debt- and 8.957,871 In 1997 ..................................... 22,394 22,394 5.82%notes due 2003.................................... 12,500 12,500 Additional paid-in capital....................................... 74,937 74,937 10.10%notes due 2009................................... 10,000 10,000 Retained earnings................................................. 52,043 49,700 6.64%notes due 2013.................................... 1,100 1,100 6.80%notes due 2013.................................... 2,000 2,000 149,974 1479031 8.60% fixed rate obligation due 2013............... 1,918 1,988 PREFERRED SHARES NOT SUBJECT Variable rate obligation due 2014...................... 6,000 6,000 TO MANDATORY REDEMPTION Variable rate obligation due 2018...................... 509 REQUIREMENTS 0.87%notes due 2023.................................... 5,000 5,000 Referred shares of 425 par value 7.00%notes due 2023.................................... 10.000 10.000 Authorized 64,000 shares 7.55%notes due 2025.................................... 8.000 8,000 Outstanding 32,000 shares,4%series.............. 800 800 7.65%notes due 2025.................................... 22,000 22,000 Outstanding 32.000 shares,4-1/4%series....... 800 800 0.81%notes due 2028.................................... 15,000 5.60%notes due 2029.................................... 8,000 6,000 1,800 1,600 Less funds held by trustee................................ (4,070) PREFERRED SHARES SUBJECT 9.56%notes due 2031.................................... 28,000 28,000 TO MANDATORY REDEMPTION Capital lease obligations................................... 934 953 REQUIREMENTS Note payable in Installments to 2000................. 2 3 Referred shares of 425 par value 130,963 111,472 Authorized and outstanding 19.200 shares In 1998 and 20,800 shares In 1997,5%series.... 460 520 Total long-term debt................................. 130,903 111.472 Less:Referred shares to be redeemed Less:Current maturities...................................... (191) (151) within one year.............................................. (40) (40) 130,772 111,321 440 460 Total capitalization................................... 282,786 $260,432 3 SOUTHERN CALIFORNIA WATER COMPANY COMPARATIVE INCOME STATEMENTS MONTH,YEAR TO DATE AND TWELVE MONTHS ENDED JUNE 30.1999 AND 1997 THIS MONTH bw.- Pwoont YEAR TO DATE bwoaoo Pw..nt TWELVE MONTHS ENDED bsow PeraoM Juno,1990 Jun.,1907 Mow0000l Chon90 Juno,1998 Jun•,1997 IDllp.-I Chang, Jun•,1990 Jun•,1997 ID•nwol Chang. OPERATING REVENUES B•••.•••.w -w•t•.•nd•bo..b S 12.295.054 1 14,057,599 1 11.762.5351 .12.54% / 62.175,501 1 97,909,949 (5,734.4481 -0.44% 1 140,102.139 1 144,?02,028 S (4,519.689) -3.12% Supply.•w.11•.t.•vnw 331.596 298.833 32,983 11.04% 2.384,071 2,082.770 321.295 15.58% 4,774,054 3,894.364 1.019,890 29.73% Bolwminp aft.-t w.wnie•ton..r•nw 37,110 - 302.937 (285,819) -07.75% 396.143 1.676.267 11.100.1241 -74.87% 2.205,280 4.391.142 12.106.6021 49.78% Tael Ope.a60 Ibr.nuo• 1 883 788 14 859 159 1 995 391 .13.61% N 955 715 71 548 992 8 593 277 -9.22% 147 181 173 157 7B7 534 5 878 081 -3.68% SUPPLY COSTS Wtw S.IN.1• 3.479.697 4,112.041 4932.3441 45.38% 13.424 940 17,598,887 14,171.9411 .23.71% 34.146.202 38.834.493 (4,888,2911 -12.07% Po....1.1 mool. 258,1134 193.105 72,809 39.85% 2.443.504 2,091.104 352,400 10.85% 5.337.359 5,260,034 70.525 0.20% P1.w,1w P-wing 491,475 541.034 (55.5591 -10.16% 7624134 3,008,299 (302.1651 -12.71% 1,171.342 7,411,471 (300.1291 -5.70% O.eundwetw p.aduotun w•o. 1 1,003,088 1.501.305 1430.2371 -29.19% 3.808,245 3,502,129 28,118 0.73% 8,873,528 0,842,293 231.233 3.09% Supply•.•1 b•broinp••o.unl-.•e•ew 380,714 W1,570 (232,0501 .38.71% 2.780.214 3,639.043 (650.8291 -23.60% 8,979,334 0.065.506 11.106,1721 -13.610% so (154.7881 % Tow Suppy Cool woountyN.no. 4 311 988 5 881 9B5 1 857 87 27.71% 20 883 845 29 180 874 B 797 O29 4 7845% 52 073 351 81 530 9 73 107 827 -181.80% REVENUES LESS SUPPLY COSTS 8 351)B7 S 891 i 71 q2 392 -3.94% 44 09?070 12 38B 318 1 703 752 4.02% 94,738,122 91,250,561i 3 4B1 SBI �� 3.07% OTHER OPERATING EXPENSES Otlen p.•duolion and apoodi.n 763.189 360.465 394.714 101.13% 3.889,447 3,298,S80 390.867 11.65% 6.828.504 7.030,155 1403.5711 5.74% Cuolonr.4000unt•owen•o 649.095 491.512 58.303 11.00% .3.330,315 3.503.004 (168.6891 -4.70% 6,671.253 6.877.244 12059911 .3.00% Adm4tiUeti•e•nd➢ono.ol e.pen•oo 1.389.041 1.185080 223.961 19.22% 7.651.489 6,363,563 1112,0741 -6.51% 19,305,475 18,890,881 (385.2061 .2.31% E.npbY•oe'p."io.•ad bonolp. 472,938 239.612 233.324 91.381L 3,095,35E 2.415.911 619.447 20.12% 6,799.217 4.061.590 937921 19.29% Widwnenoe 580,789 _ 410.050 170.731 41.04% 3.062.113 3.791.474 1135,3611 .3.56% 7.165,395 8.396.432 11.233 0371 .14.88% O•p�w'rloa 991.472 913.054 78.418 8.59% 5.948,833 5.471,938 470.095 0.00% 11,422915 10,529.005 893,910 8.49% T. on iow.r 958,934 1,567.750 1620.0161 -39.00% 3.744.232 3.303.486 440.746 13.34% 10.270.019 9.45.158 1.225,863 13.55% 0.1w t•s. 490 535 511 927 11,3921 -4.18% 2 997 147 3111216 120 D89 -3.85% 11.1025 0480390 1 B 385 4.91% Taus Otho.Op•.w+n➢E.p•n.o• B 198 7)1 5 8B7 458 509.3131 0.96% 34 121 934 33 277 1 7? 847 782 215 % 70 423 883 89 917 859 511,0241 0.771L OPERATING INCOME 2 I SS 011 - 3 008 718 SI 705 -28.33% 9 987 138 9 111 1/8 B55 990 9.39% 7/314/]9 11 313 902 2 970 53) 13.92% NON.REGULATED INCOME 100,441 (9,5361 109.979 -1153.041% 131,308 260.181 (128.7931 -49.51% 629.092 541.197 87,995 16.24% INCOME BEFORE INTEREST CHARGES J 255 152 2 997 1)B 711 726 -24.75% 10 09B 501 9 311 301 727,197 7.76% 2/913 531 21 8B5 099 3 OSB 132 13.97% INTEREST CHA17G►S 942,218 633.443 1OB,835 13.00% 5,488,548 4,978,409 510.137 10.25% 10.608929 10.304.815 362,314 3.52% 1 NET INCOME 1 313 174 2 103 735 B50 581 -39.31% /809 958 4 392 898 717 Ot10 4.9416 S 14 2I8 B02 11 S80 4B1 S 2 898 I I B 73.28% SOUTHERN CALIFORNIA WATER COMPANY CASH FLOW STATEMENT Periods ending June 30, 1998 Month Ended June 30 Year to Date 1998 1997 Change 1998 1997 Change lin thousands) On thousands) CASH FLOWS FROM - Operating Activities: Net income.......................................... $1,313 $2,164 ($861) $4,610 $4,393 $217 Adjustments for non-cash items: Depreciation and amortization............. 1,133 943 190 6,324 5,671 653 Deferred income taxes and investment tax credits..................... 636 696 39 3,028 677 2,451 Other - net.................:........................ 345 (85) 430 1,313 (798) 2,111 Changes in asset and- liabilities............................................ 2,277 843 1,434 (624) 4,459 (5,083) Net Cash Provided 5,702 4,461 1,242 14,651 14,302 349 Investing Activities: Construction expenditures..................... (3,661) (4,170) 509 (19,137) (13,448) (5,689) Net Cash (Used) (3,661) (4,170) 609 (19,137) (13,448) (5,689) Financing Activities: Receipt of advances and contributions net of repayments........... (1,111) (1,641) 530 (27) (1,774) 1,747 Issuance of securities............................ - 201 (201) 15,000 5,370 9,630 Repayments of long-term debt and redemption of preferred shares....... (17) 0 (17) 486 (69) 545 Net change in notes payable to banks........................................... 2,001 1,500 501 (8,000) (2,000) (6,600) Common and preferred dividends paid................................................. (2,844) (2,805) (39) (6,688) (5,605) (83) Net Cash Provided (Used) (1,970) (2,745) 774 1,771 (4,068) 6,839 Net Increase (Decrease) in Cash and Cash Equivalents................................. 71 (2,454) 2,525 (2,715) (3,214) 499 Cash and Cash Equivalents, Beginning of Period............................... 1,400 3,023 (1,623) 4,186 3,783 403 Cash and Cash Equivalents, End of Period....................................... $1,471 $669 $902 -$1,471 $669 $902 9 Wil " ' x T1Fy t.._-.. #-ice Exhibit H SOUTHERN CALIFORNIA WATER COMPANY BOLSA CHICA FUNCTIONAL SUMMARY OF EARNINGS-ESTIMATED YEARS (In Thousand Dollars) (a) (b) (c) CURRENT OC-1 RATES 1999 2001 OPERATING REVENUES 151.3 454.0 OPERATION EXPENSES Purchased Water 51.0 166.6 Purchased Power 9.7 31.8 Pump Taxes 17.7 58.0 TOTAL SUPPLY EXPENSES 78.4 256.4 REVENUE LESS SUPPLY EXPENSES 72.9 197.6 Chemicals 1.3 4.4 - - Alloc Common Cust Acct 4.5 14.8 Postage Uncollectibles 0.4 1.3 Operation Labor 12.2 39.9 All Other Operation Exp 4.5 14.6 TOTAL OPERATION EXPENSES 101.4 331.3 Maintenance Labor 3.7 12.0 All Other Maintenance Exp 7.8 25.5 TOTAL MAINTENANCE EXPENSE 11.5 37.5 TOTAL O&M EXCLUDING A&G 112.8 368.8 Office Supplies&Expenses 2.3 6.9 Property Insurance 0.0 0.0 Injuries and Damages 1.0 1.0 Pension and Benefits 0.3 1.0 Business Meals 0.1 0.2 Regulatory Expenses 0.5 1.7 Outside Services 1.1 3.3 Miscellaneous 0.1 0.4 Alloc General Office Exp 0.0 0.0 All Other Maint of Gen. Plant 0.3 0.8 Rent 1.0 3.0 A&G Expenses Capitalized A&G Labor 3.8 12.3 TOTAL ADMIN&GENERAL EXPENSES 16.5 30.7 DEPRECIATION AND AMORTIZATION 0.0 0.0 Property Taxes 0.0 0.0 Payroll Taxes 1.6 5.2 Local Taxes 1.6 4.8 TOTAL TAXES NOT ON INCOME 3.2 10.0 TOTAL EXPENSE EXCLUDING INCOME TAX 126.5 409.5 NET OPER REVENUE BEFORE INCOME TA 24.8 44.5 State Income Tax 2.2 2.8 Federal Income Tax 7.9 10.1 TOTAL INCOME TAXES 10.1 12.9 TOTAL OPERATING EXPENSES 136.6 422.3 NET OPERATING REVENUE $14.7 $31.6