DOMESTIC WATER POLICY COMMITTEE MODESTO IRRIGATION DISTRICT 1231 Eleventh Street, Modesto, California August 4, 2014 1:00 p.m.

Nick Blom, Chairman, MID Dave Cogdill, Vice-Chairman, City of Modesto John Mensinger, Board Member, MID Bill Zoslocki, Councilmember, City of Modesto DOMESTIC WATER POLICY COMMITTEE MODESTO IRRIGATION DISTRICT 1231 Eleventh Street, Modesto, California August 4, 2014 1:00 p.m. AGENDA ITEMS THE PUBLIC IS INVITED TO COMMENT ON ANY ITEM, WHICH IS LISTED ON THE AGENDA AT THE TIME THAT ITEM IS BEING DISCUSSED. ANY PERSON WISHING TO ADDRESS THE COMMITTEE WILL BE LIMITED TO 5 MINUTES UNLESS PRIOR ARRANGEMENTS HAVE BEEN MADE OR UPON THE CONSENT OF THE COMMITTEE CHAIR. Item No. Tab No. 1. CALL TO ORDER 2. ROLL CALL 3. PUBLIC COMMENT 4. PAT RYAN DOMESTIC WATER PROJECT UPDATE 5. 1. CHRIS DAVENPORT GREG DIAS MODESTO REGIONAL WATER TREATMENT PLANT PHASE TWO EXPANSION REPAIR PROJECT UPDATE Manito Construction, Inc.: Repair Contract Auburn Constructors, Inc.: Repair Contract Western Summit Constructors, Inc.: Repair Contract K.G. Walters Construction Co., Inc.: Terminal Reservoir Bypass Project 6. 2. PAT RYAN RECOMMEND MODESTO IRRIGATION DISTRICT ENTER INTO A SALES AGREEMENT WITH THE CARTER LAKE FILTER PLANT (CLFP) OF BERTHOUD, CO 7. PAT RYAN PROPOSED FUTURE POLICY COMMITTEE MEETINGS 8. ADJOURNMENT September 8, 2014, MID BOARD ROOM 1:00 P.M. 2:00 P.M. October 6, 2014, MID BOARD ROOM 1:00 P.M. 2:00 P.M. Document Number: 351352

MRWTP EXPANSION PROJECTS UPDATE DOMESTIC WATER POLICY COMMITTEE August 4, 2014 1 Doc #351372

Expansion Projects MRWTP Expansion Projects Current Projects MRWTP Repair Project Roof to Wall and Tieback Installations CCO Work MRWTP Repair Project Stage 2 Filter Basin Reconstruction MRWTP Terminal Reservoir Project Ball Valve Replacement and Bypass Installation 2

Expansion Projects MRWTP Expansion Projects Future Projects MRWTP Phase 2 Expansion Complete Original Contract Work Membrane Module Order Other Activities 3

Repair Project MRWTP Repair Project Contractor Manito Construction, Inc. Work Roof To Wall Connection - completed Lower West Wall Tie-backs - completed Design Deficiency Corrective Work In progress New Grating in the Pilot Plant Room Modifications in the Ozone Contactor and 60 FW Pipeline Motorize the Neutralization Basin Telescoping Valve Seismic Supports to UPS and Server Cabinets 4

Repair Project Stage 2 MRWTP Repair Project Stage 2 Contractor Auburn Constructors, Inc. Work Filter Basin Reconstruction Design Deficiency Corrective Work CCO 5

Repair Project Stage 2 Construction Contract Cost Status Auburn Constructors, Inc. Original Contract Amount - $ 5,827,300.00 7 Change Orders - $ 3,771,497.00 Current Contract Amount - $ 9,598,797.00 18 Payments thru June 2014 - $ 4,302,290.38 (Amount In Retention $185,721.08) Balance to Finish - $ 5,082,110.94 6 % Complete based on payments through 5/31/14-47%

Repair Project Stage 2 Construction Contract Schedule Status Auburn Constructors, Inc. Notice to Proceed - April 30, 2013 Contract Time - 651 Days Contract Substantial Completion Date - February 10, 2015 % Complete Contract Time through 7/31/14 70% Projected Building Turn over Date - December 4, 2014 7

Repair Project Stage 2 PROJECT STATUS Field Work Concrete Work Filter Basin Coating Mechanical Work Filter Basin Equipment Installation East Side Seismic Pipe Supports Upcoming Work Re-Installation of East Side Electrical West Side Piping 8

Repair Project Stage 2 PROJECT STATUS Field Work 9

Repair Project Stage 2 PROJECT STATUS Field Work Video July Progress 14

Phase 2 Expansion MRWTP Phase 2 Expansion Project Contractor Western Summit Constructors, Inc. (WSCI) Work Defective Work Corrections Complete Testing, Start-up, Training and Commissioning 15

Phase 2 Expansion PROJECT STATUS Field Work Defective Work Stainless Steel Pipe Exterior Finish - Completed Neutralization Basin re-coating - Completed Roofing Repairs September 2014 Contract Work Site Meeting with WSCI July 28 and 29, 2014 Equipment Checkout August through December 2014 Testing, Startup, Training* - December 2014 16 *After building hand back from Auburn

Phase 2 Expansion PROJECT STATUS Field Work 17

TR Ball Valve & Bypass MRWTP Terminal Reservoir Contractor KG Walters Construction Work Replace 2-30 Ball Valves Install 48 WS Bypass Pipeline 20

TR Ball Valve & Bypass Construction Contract Cost Status KG Walters Construction Original Contract Amount - $ 2,423,400.00 0 Change Orders - $ 0.00 Current Contract Amount - $ 2,423,400.00 Payments thru July 2014 - $ 210,463.00 Balance to Finish - $ 2,212,937.85 21 % Complete based on payments through 6/30/14-9%

TR Ball Valve & Bypass Construction Contract Schedule Status KG Walters Construction Notice to Proceed May 20, 2014 Contract Time 330 Days Contract Substantial Completion Date - April 15, 2015 Milestone 1 February 15, 2015 % Complete Contract Time through 6/30/14 22% 22

TR Ball Valve & Bypass PROJECT STATUS Field Work Potholed Last Connection 60 Line Found pipe ovaled Placed Concrete Walls of Bypass Vault 23

TR Ball Valve & Bypass PROJECT STATUS Field Work 24

Expansion Projects Questions? 25

POLICY COMMITTEE AGENDA REPORT Meeting Date: August 4, 2014 Tab No: 2 Subject: Recommended Action: Background and Discussion: Sale of Surplus Siemens S10V Membranes Supplied as Replacement Parts for the Expansion of the Modesto Regional Water Treatment Plant. Recommend Modesto Irrigation District Enter into a Sales Agreement with the Carter Lake Filter Plant (CLFP) of Berthoud, CO. Two complete sets of membranes have been delivered to the Modesto Regional Water Treatment Plant for the Phase Two Expansion Project (Project). The first set was removed by Western Summit Constructors, Inc., and their supplier Evoqua Water Technologies (Evoqua) (formerly Siemens Water Technologies) to allow them to correct deficiencies in the concrete basins that the membranes were installed in. The second set have been on the plant site since the latter part of 2010 awaiting resolution of the construction and design defects that were the subject of litigation. During settlement discussions, Evoqua made a unilateral determination that the membranes, although still in their original packing crates, were no longer warrantable. As part of the global settlement of disputes surrounding the Project, MID, the City of Modesto and Evoqua agreed that a third set of membranes (a new generation) would be supplied to commission the Project. Those membranes will soon have to be ordered. The new generation modules are reported to be more robust and require less maintenance. MID negotiated the delivery of the new version of modules to ensure that the latest technology was incorporated into the Plant. As part of MID s analysis of costs to complete the Project, it was originally anticipated that the existing modules may need to be disposed of in a landfill if MID could not find a buyer to purchase the existing membranes. Several attempts had been made to find a buyer for the membranes without success. However, at the 2014 Membrane Technology Conference, MID staff discussed the existing membranes with other attendees and there was interest by the CLFP in the Denver, CO area to purchase the membranes as-is for use in their treatment plant. CLFP is an Authority established by the Little Thompson Water District and the Central Weld County Water District who share ownership of the CLFP. The respective Boards that operate CLFP authorized their staff to negotiate terms/conditions and a sale price for the membranes at their Board meeting the second week in April. MID and CLFP staff have negotiated a sales price of one hundred two thousand five hundred dollars ($102,500) for the membrane modules and certain corresponding terms/conditions. This price includes $2,500 for Auburn Constructors, Inc., the contractor that is currently reconstructing the basins, to load the existing modules for CLFP's transport to CLFP's treatment plant. However, CLFP will be liable for all shipping and risks of loss. CLFP has agreed to Indemnify the Domestic Water Project for third party claims up to $2,000,000 per occurrence and up to an aggregate amount of $6,000,000 for the life of the membranes plus one year. All other claims will be limited to $350,000 or an aggregate of $990,000 as required by Colorado law that governs CFLP. The Technical Committee and Policy Committee have declared the Siemens S10V membrane modules as surplus at their April 3, 2014 and April 7, 2014 meetings Document Number: 351363 1

POLICY COMMITTEE AGENDA REPORT respectively. Alternatives, Pros and Cons of Each Alternative: Do not approve the terms and conditions of this sale and direct Project staff to and dispose of membranes in a landfill, which would require further efforts and expenditures on the part of MID and would result in the loss of revenue of $100,000. Seek another buyer, which may not occur in timely enough manner for the membranes to have any residual value. Concurrence: The Technical Committee concurred with this approach at its July 31, 2014 special meeting. Fiscal Impact: Recommendation: Attachments: The sale of surplus membranes will help reduce the cost of the Project. The sale would benefit the Project, City of Modesto, and MID. Recommend Modesto Irrigation District Enter into a Sales Agreement with the Carter Lake Filter Plant (CLFP) of Berthoud, CO. Supporting documents attached: Presentation Other supporting docs None attached Document Number: 351363 2