REPORT TO THE CITY COUNCIL September 27, 2018 FROM: MICHAEL CARBAJAL, Director Department of Public Utilities THROUGH: DEJAN PAVIC, Supervising Professional Engineer Department of Public Utilities - Utilities Planning & Engineering BY: MATTHEW L. BULLIS, Professional Engineer Department of Public Utilities - Utilities Planning & Engineering SUBJECT ..Title Actions pertaining to the following items (Citywide) 1. Adopt a finding of statutory exemption pursuant to Section 15262 of the California Environmental Quality Act Guidelines for engineering design for removal of 1,2,3 - Trichloropropane from five groundwater wells 2. ***RESOLUTION - Authorizing entering into a funding Agreement with the State Water Resources Control Board and authorizing and designating a representative for the Sustainable Groundwater Planning Grant Program for funding related to planning, monitoring and implementation projects for conducting a Feasibility Study to evaluate alternatives for the prevention or cleanup of 1,2,3 - Trichloropropane contamination in groundwater that serves or has served as a source of drinking water for the City of Fresno and authorizing the execution of documents (Subject to Mayor's Veto) 3. ***RESOLUTION - 9th Amendment to the Annual Appropriation Resolution (AAR) No. 2018-157 to appropriate $990,600 from the Proposition 1 Sustainable Groundwater Planning Grant Program and local match funding from the Water Enterprise Fund for a 1,2,3 - Trichloropropane mitigation feasibility study (Requires 5 affirmative votes) (Subject to Mayor's Veto) 4. Approve the Third Amendment to Agreement with Provost & Pritchard Engineering Group, Inc., in the amount of $677,000 for engineering design for removal of 1,2,3 - Trichloropropane from five groundwater wells and authorize the Director of Public Utilities, or designee, to sign all documents on behalf of the City ..Body RECOMMENDATIONS Staff recommends that City Council adopt a finding of statutory exemption pursuant to Section 15262 of the California Environmental Quality Act (CEQA) guidelines for engineering design for removal of 1,2,3 - Trichloropropane (TCP) from five groundwater wells; adopt a Resolution authorizing the Director of Public Utilities, or designee, to enter into a Funding Agreement with the State Water Resources Control Board (SWRCB) for a Sustainable Groundwater Planning Grant; adopt the 9th Amendment to the Annual Appropriation Resolution (AAR) No. 2018-157 to appropriate $990,600 from the Sustainable Groundwater Planning Grant Program and local match; and approve the Third Amendment to Agreement with Provost & Pritchard Engineering Group, Inc., (Consultant) in the amount of $677,000 for engineering design for removal of TCP from five groundwater wells; and authorize the Director of Public Utilities, or designee, to sign all documents on behalf of the City. EXECUTIVE SUMMARY The City has been awarded a Sustainable Groundwater Planning Grant (Grant) in the amount of $891,500 (with City's local match of $99,100) by the SWRCB to fund a TCP Mitigation Feasibility Study in groundwater wells and to provide for engineering design related to the feasibility study. The project is needed to assess the feasibility of remediation of TCP impacted groundwater and to provide engineering plans for the removal of TCP from groundwater. The proposed Third Amendment to Agreement with the Consultant would direct awarded grant funds to complete remedial engineering design on five of the City's wells. Staff recommends that the City accept the Grant, appropriate funds to the Fiscal Year 2019 budget, and retain the Consultant to provide the engineering design as described in the Grant. BACKGROUND In 2017 the State notified the City of upcoming groundwater regulations for TCP were being implemented and any continued use of TCP impacted groundwater above the Maximum Contamination Limit (MCL) of 5 parts per trillion (ppt) would require advanced treatment systems. The TCP Mitigation Feasibility Report, dated May 18, 2018, reported that 40 of the City's 260 active water wells have shown the presence of TCP above the MCL. City's utilization of surface water supplies has lessened the burden on underground water resources. However, groundwater will continue to be a necessary component of the overall City water system. On January 31, 2017, the City hired Provost & Pritchard Engineering Group to provide an initial TCP Mitigation Feasibility Study (Study). The scope of work included investigating City's well sites, TCP treatment options available, well prioritization for upgrades, and conducting field studies to evaluate TCP cleanup effectiveness. The cost of the initial study was $268,000. The City and the Consultant entered into the First Amendment to add engineering design work for Water Well PS70 at a cost of $99,000, and the Second Amendment extending the time for performance. The Consultant's initial report was completed in May 2018 and sent to the SWRCB for review. On April 4, 2017, the City submitted an application to the SWRCB for a Sustainable Groundwater Planning Grant which would provide funding for programs associated with groundwater treatment. This program makes $86 million available to develop and implement sustainable groundwater planning projects. Groundwater impacted with TCP qualifies for these Grant funds. On January 2, 2018, the City was approved by the SWRCB to receive a $891,500 Grant. The SWRCB also determined that the City maintains a Disadvantaged Community status, which qualifies the City for the minimum 10% grant match obligation of $99,100. Grant funding has been structured to offset costs the City incurred in development of the initial TCP Study and will also fund the next phase of remedial engineering design on five TCP impacted water wells. The Funding Agreement for this project has been approved as to form by the City Attorney's Office. Adoption of this Resolution approving the Funding Agreement and identifying an individual authorized to execute agreements is necessary to proceed. Previously, the Consultant was selected as the most qualified firm to provide the design engineering services for this project. The proposed Third Amendment will utilize the funding to direct additional engineering design for five wells within the City. The Third Amendment would add funding to the Agreement, not to exceed $677,000, for a total contract value of $1,044,000. All work related to the Third Amendment to Agreement will be completed in 480 calendar days from the authorization to proceed, which corresponds to the work schedule established in the Grant. ENVIRONMENTAL FINDINGS Staff has determined that this project falls within the Statutory Exemptions set forth in the California Environmental Quality Act (CEQA) Guidelines, Article 18, Section 15262 (Feasibility and Planning Studies), as it involves only the feasibility and planning studies for possible future actions which the Council would later approve. FISCAL IMPACT Acceptance of the Sustainable Groundwater Planning Grant will not impact the General Fund. With approval of the 9th Amendment to the AAR No. 2018-157, the Grant proceeds will be accounted for in a separate fund and the matching funds required for this project will be appropriated from retained earnings within the Water Enterprise Fund (40101). Attachments: Sustainable Groundwater Planning Grant, Agreement No. SWRCBD181252100 (Attachment 1) Resolution - Accepting Sustainable Groundwater Planning Grant and Entering into Funding Agreement (Attachment 2) Resolution - 9th Amendment to the Annual Appropriation Resolution No. 2018-157 (Attachment 3) Third Amendment to Agreement with Provost & Pritchard Engineering Group (Attachment 4)