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HomeMy WebLinkAboutAgenda Packet - June 27, 2011 -UB ._ .4, F AZUSA UGH, A nATFR AGENDA REGULAR MEETING OF AZUSA UTILITY BOARD AZUSA LIGHT & WATER JUNE 27,2011 729 N. AZUSA AVENUE 6:30 P.M. AZUSA, CA 91702 AZUSA UTILITY BOARD KEITH HANKS CHAIRPERSON ANGEL CARRILLO JOSEPH R. ROCHA VICE CHAIRPERSON BOARD MEMBER URIEL E. MACIAS ROBERT GONZALES BOARD MEMBER BOARD MEMBER 6:30 P.M. Convene to Regular Meeting of the Azusa Utility Board • Call to Order • Pledge to the Flag • Roll Call A. PUBLIC PARTICIPATION 1. (Person/Group shall be allowed to speak without interruption up to five (5) minutes maximum time, subject to compliance with applicable meeting rules. Questions to the speaker or responses to the speaker's questions or comments shall be handled after the speaker has completed his/her comments. Public Participation will be limited to sixty (60) minutes time.) 1 0U1 B. UTILITIES DIRECTOR COMMENTS C. UTILITY BOARD MEMBER COMMENTS D. CONSENT CALENDAR The Consent Calendar adopting the printed recommended action will be enacted with one vote. If Staff or Councilmembers wish to address any item on the Consent Calendar individually, it will be considered under SPECIAL CALL ITEMS. 1. Minutes. Recommendation: Approve minutes of regular meeting on April 25, 2011 as written. UB April 25 Min.pdf 2. Annual Software License and Maintenance Services Agreement. Recommendation: Approve an annual software license and maintenance services agreement with Power Settlement Consulting and Software, LLC in amount$833.33 per month and authorize the Director of Utilities to execute agreement. irat Rpt-Pwr Consulting Pwr Consulting Agr t.pdf Agrmt.pdf 3. Air Conditioning System Maintenance Contract. Recommendation: Approve the award of three- year contract for air conditioning maintenance services for four Azusa Light & Water facilities to Ontario Refrigeration Service, Inc. in amount of$21,096 for three years ($7,032 per year). 01011* AC Ma int Onta rioRef Ma intSpec Contract.pdf s.pdf E. PUBLIC HEARING 1. Public Hearing and Adoption of Azusa's 2010 Urban Water Management Plan. Recommendation: Approve the following resolution: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, ADOPTING THE YEAR 2010 URBAN WATER MANAGEMENT PLAN. 2010 UWMP Reso-2010 Update.pdf UWMP.pdf 2 002 F. SCHEDULED ITEMS 1. Electric Vehicle Rates and Service Study Contract. Recommendation: 1) Award contract to Utility Financial Services (UFS) to perform an Electric Vehicle Rates and Service Study; and 2) award the Professional Services Agreement to UFS in amount not-to-exceed $9,959. 1;111- EV Rate UFS Proposal.pdf Study-UFS.pdf 2. Scope of Work for Electric Vehicle (EV) Public Charging Stations. Recommendation: Approve the scope of work to solicit proposals for the installation and maintenance of EV public charging stations in Azusa. EV Charging Stations EV RFP.pdf RFP.pdf 3. Adoption of Extended Producer Responsibility (EPR). Recommendation: 1) Approve the following resolution supporting Extended Producer Responsibility as presented; and 2) authorize the City Manager or his designee to sign the California Product Stewardship Council (CPSC) Pledge of Support and pursue CPSC Membership. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, SUPPORTING THE EXTENDED PRODUCER RESPONSIBILITY (EPR) SYSTEM AND PLEDGING SUPPORT TO THE CALIFORNIA PRODUCT STEWARDSHIP COUNCIL(CPSC). a. EPR-Rpt.pdf EPR-Reso.pdf CPSC Pledge.pdf EPR Framework.pdf G. STAFF REPORTS/COMMUNICATIONS 1. Azusa Hydroelectric Plant and Conduit Acquisition Update(Verbal) 2. San Juan Generating Station Update(Verbal) 3. Report on "Direct Buried" Secondary Electric Cables at the Hunsaker Tract Hunsaker Tract.pdf 003 3 4. California Renewable Portfolio Standards(RPS)Bill Update RPS Law Update.pdf 5. Power Cost Adjustment(PCA)Effective July 1,2011 1 PCA Report.pdf PCA Background.pdf 6. 3'd Quarter Budget Reports for Electric and Water Utilities 3rd Qtr Fin Rpt.pdf Electrc.pdf Water.pdf 7. Beverage Container Recycling Program Update School Recycling Program pdf H. ADJOURNMENT 1. Adjournment. "In compliance with the Americans with Disabilities Act,if you need special assistance to participate in a city meeting,please contact the City Clerk at 626-812-5229. Notification three (3) working days prior to the meeting or time when special services are needed will assist staff in assuring that reasonable arrangements can be made to provide access to the meeting." "In compliance with Government Code Section 54957.5, agenda materials are available for inspection by members of the public at the following locations: Azusa City Clerk's Office-213 E. Foothill Boulevard, Azusa City Library-729 N.Dalton Avenue, and Azusa Light& Water-729 N.Azusa Avenue,Azusa CA." 4 004 ■ ■ Meeting I.41 4 Ogip, • I A fit 10 1` 41, 44111/111. June 27 2011 sew Chair Keith Hanks0.0%•• • AZUSA LIGHT & W A T [ a Consent Agenda • April 25, 2011 minutes • Power Settlements Consulting and Software License and Agreement ($10,000) • A/C System Maintenance Agreement to Ontario Refrigeration Service ($21 ,096 for 3 years) AZUSA Public Hearing -- 2010 Urban Water Management Plan Azusa Utility Board June 27, 2011 2 AZUSA 1 Electric Vehicle Rates and Service Study Azusa Utility Board June 27, 2011 3 AZUSA Background • Electric Vehicles are arriving in Southern California • Existing electric rates did not consider EV charging pattern when developed • There is a need to establish a new "time of use" rate(s) to encourage EV's to charge during lower load and cost periods • Staff issued an RFP for EV rates services and opened bids on June 7. 4 AZUSA 2 RFP Results COMPANY AMOUNT 1)Utility Financial Solutions(UFS) $ 9,959.00 2)Bums&McDonnell $19,000.00 3)MBMC Inc. $19,835.00 4)Energy Source $24,900.00 5)Black&Veatch $45,000.00 6)SAIC Inc. $55.000.00 7)Shpigler Group $67,000.00 5 AZUSA Scope of Work • Survey EV rate,incentive and service practices at other utilities • Review/document Azusa and Wholesale market prices by time of day and season. • Develop EV residential rate charging options for Azusa • Evaluate rate options and identify distribution system cost recovery alternatives • Document pros and cons of implementing EV incentives locally • Perform a similar analysis for EV charging at businesses or at local charging centers +A. 6 A 3 Recommendation • Approve a contract award to low bidder Utility Financial Solutions for $9,959. 7A?*zus A Electric Vehicle Public Charging Stations aYF Azusa Utility Board June 27, 2011 8 AZUSA 4 Background • As noted earlier, pure and hybrid electric EV's have begun to be delivered nationally • There is an expected need for the travelling public to be able to charge EV's outside of the home • There is an opportunity for Azusa to play a leadership role in promoting public EV charging 9 AZUsA ELECTRIC VEHICLE CHARGING IN THE EARLY — 1900's p, , ' • irt, ' , pr I , or "' - „... AZUSA 5 Modern EV Charging Station Component housing design%bows 9D"Weasherproof.sunlrAe readable for wan mounted msabattons LCD touch screen Indestnatanle and identifiable Card reader'doves mtddple stainless steel component housing types of acdess Deigned to be sok.secure and 1 Dual Level 2(240V/)W)dorsi%abWey meet or exceed all national 4✓4 with national standard SAE J1772 standards for dsargmg station +ZZZ CanneCt rs edupment LS: Durable concrete pedestal - �..highly v+slbte toned cord prevents prevents the need for concrete .y: damaged and misplaced cords bolhrds,is ADA compliant and :.�: and prevents trip hazards is designed for vehsck bnrnpe'heights 11 AZUSA EV Charging Station Elements • Public or leased parking spaces for charging use • EV charging device • Electric service and metering to charger • Communications to charging unit to monitor usage and for billing • Automated Point —of-Sale system for accounting and billing 12 AZUSA i c.s s ea,. 6 Sample EV Charging Units ....._ ----v . , ,•.- ,,,, . 4 1 311te• ' - r; It -4 :t • - it, tt. iv N. 1 i 4,... '- 1111011111.1111r.-__ ."..,...0 .....„,", 13 More Samples di • • 4110 11 !/ MIM 1 1 I dm. 14 7 Proposal • Staff proposes to encourage third party installation and operation of at least 5 public charging station in Azusa • Demonstration project will enable evaluation of the feasibility/economics of installing and maintaining local charging stations 15 AZUSA Potential Locations • Shopping center or major commercial business • Educational institutions • Existing gasoline stations • Civic center or governmental facilities • Public parking structure or spaces 16 AZUSA 8 Benefits • ELECTRICITY SALE$ . - • ENCOURAGE AND SUPPORT EV USAGE • BUSINESS AND COMMUNITY DEVELOPMENT • REDUCE CARBON FOOTPRINT / GHG 17 AZUSAv Recommendation • Approve the issuance of an RFP to solicit proposals for EV charging stations in Azusa 18 AZUSA 9 Extended Producer Responsibility (EPR) rult - \ P \i-- , ,j ,_ „ , , Azusa Utility Board June 27, 2011 ,`„„ MA 19 AZUSA Background • In 2006, California banned universal wastes from landfills followed by ban on "sharps" waste in 2008. — Includes electronics, cell phones, fluorescent lights, batteries, paint and pesticides, hyperdermic needles, etc. • Today, local governments are responsible for managing disposal of these toxic goods • Many believe such collection programs would be more cost effective if managed by private sector 20 AZUSA 10 Hazardous Waste • Cost of collecting, recycling and disposing of hazardous products exceeds $500 million per year in California • LA County alone spends over $10 million per year on collection events • Azusa funds a sharps program from AB 939 fees and promotes LA County household hazardous waste round ups 21 AZUSA Extended Producer Responsibility (EPR) • Also known as Product Stewardship • Means whoever designs, produces, sells or uses a product takes responsibility for its environmental impact • Shifts product management from government/ratepayer funding to producer or brand owner • Objective to promote more eco friendly products and packaging 22 AZUSA 11 EPR Program Highlights • "User Pays" System — Ensures that end-of-life disposal costs are reflected in product prices • Better Product Design • Reduced Environmental Impact • Product Stewardship Plan • Producers are to have a Plan if they sell in California 23 EPR Actions • California Stewardship Council is organization of local governments promoting fair and transparent EPR • CalRecycle adopted and EPR policy in 2008 as basis for future legislation • San Gabriel Valley COG has 2 1/2 year grant to begin transition to EPR system 24 Z� .A EPR Support • To date, over 100 jurisdictions have pledged EPR support: —City and County of Los Angeles —Covina —Claremont — Monrovia — Pasadena — La Puente —San Dimas —La Verne 25 Zl S Resolution • Urges CalRecycle and others to continue actions to Implement EPR Framework in California • Urges Department of Toxic Substances Control to implement Green Chemistry initiative • Urges CA legislature to enact EPR legislation • Authorizes City Manager to send letters of support for EPR legislation/regulations • Authorizes participation in the California Product Stewardship Council and related$1000 contribution 26 AZLSA 13 RecommendatIon • Approve a Resolution supporting an Extended Producer Responsibility (EPR System and Pledging Support to the California Product Stewardship Council 27 7USA t A E‘ Update on Azusa Hydroelectric Plant and Conduit Acquisition t Azusa Utility Board June 27, 2011 28 AL) 3 A I f k A Y.i t- 14 San Juan Generating Station Update Azusa Utility Board June 27, 2011 =:,r-; 1291 Direct Buried Cable Report - Hunsaker Tract I - , [.... • . Azusa Utility Board June 27, 2011 -..k.',::-..-.. 30 15 Hunsaker Tract R , , • ee r ,1 1 w Adinio 11- 31 , , Hunsaker Tract , i R e y to t • J 3 • • 32 16 Background • Hunsaker tract built in 1960's • Direct buried electrical (i.e. no conduit) • Past instances of cable failure • In 1990, the 12 KV primary cables were replaced and put in conduit • Direct buried "secondary" voltage and service cables remain as liability 33 A7US., Hunsaker Status • Of the 129"services" in the subdivision, only 5 have been buried with conduit • Scope to replace: — 16,813 linear feet of new conduit of various diameters —48,739 linear feet of new 600V conductors • Cost to address other cables estimated to be in excess of$1 million • Reconstruction work would take 6 to 8 months to complete(disruptive) 34 A7'CSA 17 Tract 28528 • In addition to Hunsaker Tract, one other tract has direct buried conductors • Bounded by Sierra Madre to the north , 13th street to the south , Azusa Ave . to the west, and Alameda on the east. • 12 homes remain served by direct buried lines (one other was updated) Ar 35 AZUSA Tract 23528 TRACT N2 22526 i• +AO 7r..... . 1. -. 11) +i 1 1 1. 1 I 1 t- I1_, =,j �, 1 .1: \ •.,-x: ;t :f ifs >" j. J� I s3• ;_.5s_d"u" • ► .. • I • rf'.'t �r :3 >� Ii 36 18 Plans • There are no current plans for converting the direct buried lines in the Hunsaker and 23528 tracts • Utility will consider in future capital budgets over next 3-5 years as funds are available 37 AZ : California Renewable Portfolio Standards Bill Azusa Utility Board June 27, 2011 138 19 Background • On April 12, 2011 Governor Brown signed into law SBx1-2 (the RPS Bill) • Bill requires all California electric utilities to meet a 33% renewable energy objective by December 31 , 2020 39 Compliance Periods Compliance period Renewable Energy Target 1. 1/1/2011— Average of 20 percent of retail sales throughout this 12/31/2013 period 2. 1/1/2014— "Reasonable progress"to ensure 25 percent 12/31/2016 renewable energy by the end of this period 3. 1/1/2017— "Reasonable progress"to ensure 33 percent 12/31/2020 renewable energy by the end of this period 40 20 "Buckets" "Buckets" Percent of RPS Target A. Energy or RECs from eligible resources that: CP 1:Minimum of 50% CP 2:Minimum of 65% - Have the first point of interconnection with a CA balancing CP 3:Minimum of 75% authority or with distribution facilities used to serve end users within a CA balancing authority area;or - Are scheduled into a CA balancing authority without substituting electricity from another source.If another source provides real- time ancillary services to maintain an hourly import schedule into CA,only the fraction of the schedule actually generated by the renewable resource will count;or - Have an agreement to dynamically transfer electricity to a CA balancing authority. B. "Firmed and shaped"energy or RECs from eligible resources CP 1:Maximum of 50% providing incremental electricity and scheduled into a CA balancing CP 2:Maximum of 35% authority. CP 3:Maximum of 25% C. Energy or RECs from eligible resources that do not meet the CP 1:Maximum of 25% requirements of category A or 6,including unbundled RECs. CP 2:Maximum of 15% `\ CP 3:Maximum of 10% Note:`CP"means Compliance Period 41 A .E Zl!SA POU Reporting Requirements • Annual public meeting to discuss the utility's renewable energy resources procurement plan • Annual report to the CEC on the renewable energy procurement contracts the utility executed during the previous 12 months • Annual report to the CEC and the utility's customers on: — Expenditures of public goods funds for eligible renewable energy resource development — Resource mix used to serve its customers by energy source — Status of implementation of RPS program and progress towards RPS target. 42 AZUSA 21 Enforcement • Each POU governing board must adopt an RPS enforcement program by January 1,2012 • By July 1 2011,the CEC must adopt regulations specifying enforcement procedures,including a public process under which the CEC can issue a notice of violation and correction against a POU for failing to comply with the RPS requirements • If the CEC determines that a POU has failed to comply,the CEC must refer the failure to the Air Resources Board. • ARB is authorized to impose penalties consistent with the Health and Safety Code • Penalties must be comparable to those adopted by the CPUC in respect of IOUs. 43 AZt'FA Other • Bill was adopted in haste with only a modicum of public process • A"Clean-up"bill is being developed • Will Hoover upgrade count as RPS? — Presently,Azusa has 19.3%renewable which includes 1.7%Hoover contribution • Staff will report further to Utility Board when the dust clears 44A4 A 22 Power Cost Adjustment JJJJ �� J Azusa Utility Board June 27, 2011 45 :1 Z 1 Background • PCA designed to recover purchased power costs not in rates or provide a credit to customers as appropriate • The base PCA is calculated annually with semi- annual true-ups • The PCA is currently $0.00958 per kWh • The PCA will be $0.02059 per KWH on July 1 • Increase is 1.101 cents/kWh ($1.4M revenue over six month period) 46 23 The Numbers FY 2011-12 Purchased Power Budget $22.871,489 Expected Sales (MWH) 238,875 Cost per MWH $95.75 Base Rate Cost Recovery per MWH $81.64 Budget Based PCA per Irl WH $14.11 Unrecovered Cost from Prior 6 Months per MWH $4.61 Total PCA without City Fees per MWH $18.72 . PCA with City Fees of 10%o per I• WH $20.59 ..~ 47 AZLL, . FY11 3rd Quarter Financial Report iiiwitl jr1 -4 -...„, - 1-,, , i Azusa Utility Board June 27, 2011 ...v.,. .,,....- A7A 24 Background • Staff regularly reviews the financial status of the Water and Electric funds • All numbers preliminary as City's accounting process is a continuum 49 AZUSA Water • The Water utility ended 3rd Quarter with $26.3M cash reserve ($25M minimum). • Quarterly sales dropped 6.2% from prior year and 26% from FY07 • Debt service coverage of 1.35 is adequate (1.25 goal) 50 AZl . 25 f esw.p,ron and Resets.Info Briar FYEwa 361106-F.uted Per.,ot onnm,ption-CCF: 7,853,732 5,650,960 72°. ash Reserve Policy An.nm.k' S 21,174,446 S 26,327,036 119° Bodes Anvil TM Pelmet of Fl 2009.2140 budget Inmmianon 10,11 3ed 06 Budget nail Billing Amounts 517,321.365 S 1:,6.56,448 72 -*Met Revenues 515,010 472,403 91 Interest Income 300000 37,411 l olal Revemes S*8336.369 S 13,146,761 71'. Water Expenses won,tion 83,03.405 51,833,414 i wa awa)Water 3.112.415 1,235,643 33°. ra.s.manon and Distribution 2315.270 1.831.891 74°. , ner A..vaneng.md Sales°' 4,069.703 3.198.109 78°. 6dutinLstrae,o and Engineering 963.103 430.161 46° Franchise Fees 390,660 239.770 06" Subtotal Expenses S/1391565 S S.629.099 61°. apita1 Expenditures/Debt Senice•. 'I Service Payments" 61.331,170 S 3390.22 75' apial 4nlao.vsxwn Budget"5' :19.600 99,337 5' Arita*Projects Funded to'Bona [23,3081 (13,506) 110° Total Expenses Ilea Bond Funding) S 21.006,027 6 12293050 00°. Adjustments *rm.:,(>t,t"' SO SO 0°. Total Expenditures and Transfers 026.1 S 21.086.02: $ *2.193.0:0 58°'. Net Change in Cash(Negative) $42.54.6611 ScED 1' Debt Coverage Ratio' 1.00 1.35 im°.+v 51 A7L Electric • Positive cash of $581 K to date • Debt coverage of 6.1 is good • Sales declined 4.2% from prior year through second quarter and 6.9% from two years ago Milk itt 52 26 a«uuo,ptton and Ketone info Min,IN 1 vd 3,d 01,[nd,d per.rot 33u11 mamlption-kWh: 245,616,149 181,142.283 73.75% eh Reserve Policy Amount^' S11439,529 517.021,117 105% 1120)02151 Nudge lntonoat,u, Ono. A.ennl lln' Por.ens u( 1111 0331-11 Buds, se I,.O Billing Amounts'' 631.515,900 88,165,126 80% I*sale Revenue' 5,361,025 4587087 72% e,, Miscellaneous Remaw. 303,300 401.170 1329i *rest Income 245,715 240.061 98% ElectricTotal Revenaee 536,428,940 630,394 046 79% xpenxe ' 'ased?aver' 58,566.120 516,930,542 74% ransmission2Dispatching 1942,015 2,861438 73% •-atlms and Maintenance 3,408555 2,303,442 68% •donnistrntiac and General" 2.419.981 1.960,317 81% I vanchlu TM IrvLbu-To, 3,456,210 2,559827 74% Subtotal Expenses 538,790,931 528,615.566 74% apital Expenditures/Debt Semite Ling Terns Debt Seniced' 8948,615 $711,461 75% apical Outlays and Projects"' 1,932749 490,200 25% Total Expenditures 541,672295 629,817,227 72% Adjustments serum Outs' (59.450) (54 7671 50% Total Expendihoes and]rainless Out 840,662,845 829,817460 72% Gunge in Cash/Reserve (53,23.905) 5581588 5% Debi Coverase Ratioo' 3.26 6.10 53 "2 UAUS.A 3rd Qtr Utility Sales Water Electric FY CCF Sales Billings FY kWh Sales Billings 04-05 6,833,381 $11,301,003.92 04-05 190,471,748 $20,612,794.63 05-06 7,157,757 $11,096,241.13 05-06 187,307,423 $20,923,914.66 06-07 7,689,683 $12,205,584.09 06-07 198,360,951 $22,360,051.02 07-08 6,488,230 $11,844,582.36 07-08 191,906,326 $22,220,739.62 08-09 6,325,483 $10,660,371.05 08-09 194,575,820 $24,636,826.89 09-10 6,021,086 $11,673,294.81 09-10 189,042,374 $23,173,576.13 10-11 5,650,960 $12,636,447.78 10-11 181,142,283 $25,165,12733 4d AZUSA 27 Beverage Container Recycling Program 406, / _j4 � y Il_ _ Azusa Utility Board June 27, 2011 AZL.�� . Background • This reports is intended to address questions asked at the recent budget hearing • California Beverage Container and Litter reduction Act • Azusa receives a small annual grant from CaIReCycle for beverage container recycling and litter clean-up A 4; 56 AZUSA 28 History • Since 2001 , City has received $123,652 • Primarily used to purchase fifteen 20-cubic yard roll off bins — Called Mobile Azusa Recycling Stations • Also in-classroom recycling receptacles for schools and for non-profit organizations — Used for newspaper, plastic bottles and aluminum 57 AZUSA Benefits • To date, schools and non-profits have received $104,334 for 1 ,184 tons of recyclables • Highest earners have been the Senior Center, Foothill Middle School and Mountain View Elementary t$N . 58 AZUSAe 29 FY12 • City to receive $12,759 from Department of Conservation • Funds will be used for maintenance of recycling bins, additional in-classroom receptacles, if requested, and possibly river clean-up 59 A 20 Cubic Yard Bins • Staff has received requests for additional bins. • Expensive since current cost is about $10k each (originally$4K) • Will review criticality of need and may use some AB 939 funds to purchase additional bins I 60 AZU A 30 13 OPP 41 4111 If AZUS.A. LIGHT a WATER CITY OF AZUSA MINUTES OF THE REGULAR MEETING OF THE AZUSA UTILITY BOARD/CITY COUNCIL MONDAY, APRIL 25, 2011 — 6:30 P.M. The Utility Board/City Council of the City of Azusa met in regular session, at the above date and time, at the Azusa Light and Water Conference Room, located at 729 N. Azusa Avenue, Azusa, California. Chairman Gonzales called the meeting to order. Call to Order ROLL CALL Roll Call PRESENT: BOARD MEMBERS: GONZALES, CARRILLO, HANKS, ROCHA ABSENT: BOARD MEMBERS: MACIAS (entered meeting at 6:35 p.m.) ALSO PRESENT: Also Present City Attorney Ferre, City Manager Delach, Director of Utilities Morrow, Assistant to the Director of Utilities Kalscheuer, Assistant Director of Water Operations Anderson, Public Works Director/Assistant City Manager Haes, Assistant Director of Resource Management Lehr, Assistant Director of Electric Operations Langit, Assistant Director Customer Service Vanca, City Engineer Hassel, Business Development/Public Benefits Coordinator Reid, Captain Momot, City Clerk Mendoza, Deputy City Clerk Toscano. ELECTION OF OFFICERS Election of Off. Moved by Board Member Rocha, seconded by Board Member Carrillo and unanimously* carried to appoint Hanks Board Member Hanks as Utility Board Chairperson. * Board Member Macias entered the meeting following UB Chairman this action. Moved by Board Member Gonzales, seconded by Board Member Rocha and unanimously carried to appoint Carrillo UB Board Member Carrillo as Vice Chairperson of the Utility Board. Vice Chair PUBLIC PARTICIPATION Pub Part None. None UTILITIES DIRECTOR COMMENTS Utilities Director Morrow announced that the Palo Verde Nuclear Power Plant operation has bee extended to Dir of Utilities 2045. Comments Info Palo Verde Plant 00.5 UTILITY BOARD MEMBER COMMENTS Brd Mbr Cmts None. None The CONSENT CALENDAR consisting of Items D-1 through D-4, were approved by motion of Board Consent Cal Member Hanks, seconded by Board Member Carrillo and unanimously carried. Appvd 1. The minutes of the regular meeting of January 31, 2011, were approved as written. Minutes 2. Approval was given to award a professional services agreement to SA Associates for inspection services Water Main for Project W-266A,Water Main Replacement Project in Hilltop in Azusa,San Bernardino Road in West Replacement Covina and Los Angeles County, and Workman Avenue in West Covina, in amount not-to-exceed SA Associates $58,000. W-266A 3. Amendment to blanket purchase order number 1111798 with Sterling Technologies,LLC for purchase of Amend P.O. additional water treatment chemicals in amount of$32,000, was approved. Sterling Tech 4. Contract was awarded to Survalent Technology Incorporated to furnish and install a SCADA system for Survalent Tech monitoring the electric substations in amount not-to-exceed $82,750. Cntrct SCADA SCHEDULED ITEMS Sched Items Bill Payment Contracts Extension. Bill Payment Director of Utilities Morrow presented item stating that there are two vendors who are currently processing Dir of Util bill payments on a contract, there are two reasons that changing vendors would be a hardship: (1)they are Extend currently under contract with Systems& Software for enQuesta Customer Information System upgrade and Contracts according to the contract Systems & Software will only upgrade with current interfaces/vendors, which are Infosend and Paymentus;and(2)Infosend is intricately entwined in the business,including online billing and payment with web pages they wrote and designed. He responded to questions posed by Board Members regarding postage cost. Moved by Board Member Gonzales,seconded by Board Member Macias and unanimously carried to approve Approved to the extension of contract with Infosend for two years until February 1, 2013 along with amended purchase Extend order of $181,000 for bill print/mail and electronic bill presentment/payment services, and approval of Contract extension to Paymentus contract to process pay-by-phone and web payments for same period. With Infosend Solicitation of Request for Proposals to Evaluate the Azusa Hydroelectric Plant and Conduit. Solicit RFP Director of Utilities Morrow provided the history and background regarding conduit and powerhouse built in Dir of Util the late 1880's by SCE's predecessor. He stated that the power plant was replaced in late 1940's to convert Azusa Hydro from 50 hertz to 60 cycle power and in 1933 Pasdena purchased project from SCE during construction of the Electric Plant Pine Dam and Reservoir,now call Morris dam. He presented the revised scope of the work which was omitted & Conduit from the staff report for the agenda item, and responded to questions posed. Lengthy discussion was held between Board Members and Staff. Moved by Board Member Macias,seconded by Board Member Gonzales and unanimously carried to authorize RFP evaluate staff to solicit proposals from qualified consultants to evaluate the condition of the Azusa Hydroelectric Plant Azusa Plant and Conduit from an acquisition feasibility standpoint. Refuse Rate Adjustment Public Hearing Notice Authorization. Refuse Rate Assistant to the Director of Utilities Kalscheuer addressed the issue stating that every year there is a refuse rate C. Kalscheuer adjustment pursuant to the agreement with Athens Services and that new rates are effective July 1, and Notice Pub Hrg according to Prop 218 requirements there is a need for a 45 advanced notice of a public hearing. Refuse Rate Adjustment 04/25/11 PAGE TWO 006 He noted the adjustment will be made using the Consumer Price Index, Puente Hills disposal rates paid by C. Kalscheuer Athens and amount of waste collected. He stated that there has been a 1.8%increase in the CPI from January Continued 2010 to January 2011 and landfill prices were stable at$38.26/ton. He noted the amount of waste collected, noting the rate changes, i.e.decrease in residential barrel service and multifamily bin rates,and an increase in commercial bin service rates;he presented cost comparison for surrounding cities. He responded to questions posed by Board Members and discussion was held. Board Member Macias requested that staff look into the cost of replacement barrels and consider providing for household without them and spread cost over a certain time period. Moved by Board Member Macias,seconded by Board Member Gonzales and unanimously carried to authorize Pub Hrg Ntc staff to print and mail advanced notice of public hearing to be held June 20,2011 to consider the annual refuse Approved rate adjustment and "true up." Refuse Rate Water Supply Update and Ratification of Cancellation of Phase II Water Shortage Declaration. Water Supply Director of Utilities Morrow detailed the reason for the current Water Rule 21 which provided for the Dir of Util declaration of various drought phases adopted as of July 1, 2008. He stated that the rainfall has bee above Comments average for the past two years,groundwater in the Main San Gabriel Basin is at 230 feet(37 feet higher than last year),State Water Project allocation raised from 50%to 80%,Dams are 80%full,and Azusa's percolation ponds are full and overflowing. He stated that Governor Brown declared the 3 year drought over on March 30, 2011, and the snowpack state-wide is 165%of normal. He stated that he and the City Manager recommend cancellation of the Phase II water shortage and voluntary continuation of sound water use & efficiency practices by water users. Lengthy discussion was held. Moved by Board Member Macias,seconded by Board Member Hanks and carried by roll call to ratify the City Cancel Phase II Manager's and Director of Utilities' recommendation to cancel the Phase II Water Shortage Declaration Water Shortage effective May 1,2011 due to an improved water supply situation,while strongly encouraging continuation of Declaration water conservation measures by consumers. Board Member Rocha and Board Member Gonzales dissenting. Approved Local Resource Adequacy Capacity Purchase Agreements for 2012. Capacity Pur 2012 Assistant Director of Resource Management Lehr addressed the item stating the Resource Adequacy Program Y. Lehr provides that the city procure sufficient electric power capacity plus 15%for reserve margin ahead of time to Comments ensure adequate supply of electricity. Azusa's Local Capacity requirement for 2012 is 35 MW and current wind and hydro resources provide 4 MW;there is a net requirement is 31 MW. He reported that proposals for capacity resources were received from five bidders on April 12th; he detailed the System Capacity and Local Capacity, and recommended to purchase 31 MW of Local Capacity from NRG and Calpine and reject all System capacity offers as too high and continue to monitor the market. Moved by Board Member Carrillo,seconded by Board Member Macias and unanimously carried to approve Pur LRA two Local Resource Adequacy Capacity purchases totaling 31 Megawatts($883,200)from NRG and Calpine; Capacity NRG and authorize the Director of Utilities to execute confirmation agreements. And Calpine STAFF REPORTS/COMMUNICATIONS Staff Rpts Assistant Director of Electric Operations Langit presented background information on Emergency Repair Emergency Work at 543-529 Virginia Ann Drive stating that on March 12th a 1980's vintage "direct buried" electric Repair work service line failed and a temporary overhead service was installed,but permanent repair required installation of Virginia Ann underground conduit. Emergency purchase order was issued to MJ Star Lite to install the conduit and all repair work was completed on April 12, 2011. He responded to questions posed by the Board Members. Assistant Director of Electric Operations Langit reported on the Novinium Cable Rejuvenation Pilot Project, Cable detailing the technology involves and displaying the several photos of the project, i.e. riser treatment, UG Rejuvenation cables inside vault and transformer, cable rejuvenation tools and equipment and the cable rejuvenation. He Pilot Project presented a cost comparison regarding buried cable rejuvenation versus conventional cable reconstruction. 04/25/11 PAGE THREE r� 00 ( Director of Utilities Morrow and Business Development/Public Benefits Coordinator Reid presented the Keep Your "Keep Your Cool"Programs which Audits and Retrofits Small Businesses as well as convenience stores and Cool Program • small grocery stores which are limited to lighting and building shell improvements. It provides refrigerator equipment tune-ups, refrigerator door seal replacements, and inside case lighting retrofits. The Program is administered through existing SCPPA joint action agreement with a$60,000 budget per year. They responded to questions posed by Board Members. Assistant to the Director of Utilities Kalscheuer presented the 2"d Quarter Budget Reports for Electric and 2"d Quarter Water Utilities. He stated that the Water utility started FY 11 with a$22M cash reserve,sales dropped 5.2% Budget Reports from prior year and 25%from FY07 for 2°d quarter. Debt service coverage of 1.57 is good and major pipeline Water and replacement project is planned for later in the fiscal year. For the Electric,the beginning reserve balance was Electric $11.4 million with a positive cash flow of$732,000 to date. Debt coverage of 7.08 is good,PCA revenue to Utilities date of$1.2 million and sales declined 5.2%from prior year through second quarter and 9.2%from two years ago. Discussion was held. It was consensus of Board Members to adjourn. Adjourn TIME OF ADJOURNMENT: 8:13 P.M. SECRETARY NEXT RESOLUTION NO. 11-C32. 04/25/11 PAGE FOUR 008 f 1102 : AZUSA IIGHi 8 WAiFP CONSENT CALENDAR TO: HONORABLE MAYOR AND MEMBERS OF THE AZUSA CITY COUNCIL FROM: GEORGE MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: APPROVAL OF AN UPDATED LICENSE AND CONSULTING SERVICES AGREEMENT WITH POWER SETTLEMENTS CONSULTING AND SOFTWARE, LLC RECOMMENDATION It is recommended that the Utility Board approve a new License and Consulting Service Agreement with Power Settlements Consulting and Software, LLC and authorize the Director of Utilities to execute the agreement. BACKGROUND On April 1, 2010 the California Independent System Operator (CAISO) instituted a new electric wholesale market structure. The resulting market is a centralized electricity market whereby the City is required to sell all of its power resources into this market (and/or other wholesale markets) and buy out of this market all the electricity and Ancillary Services needed locally on a day ahead and hourly basis. The CAISO uses sophisticated and complex optimization algorithms to determine the least cost dispatch of generation resources and Ancillary Services to serve all electric needs within its Balancing Authority Area. Accordingly, highly specialized automated functionalities (software) are needed by load serving entities such as Azusa Light & Water to operate in this complex environment. Due to the complexity of the CAISO market, staff has been using a specialized computer program licensed from Power Settlements Consulting and Software, LLC ("Power") to perform daily settlement functions. The current agreement with Power was approved by the Utility Board on July 26, 2010. Since Light & Water continues to have a need for CAISO settlement functionality and since the software by Power has been working well 009 Power Settlements Software Agreement June 27, 2011 Page 2 and is relatively inexpensive, staff wishes to enter into this updated Agreement in order to receive a higher level of service. Since the Azusa Municipal Code requires Utility Board and/or City Council approval on all professional service contracts of $10,000 or more, this Agreement is presented for your consideration and approval. The term of the updated Agreement is July 16, 2011 through June 30, 2012; there is also a three (3) year "extension by mutual agreement" provision option built in. The updated Agreement can be terminated by either party upon 30-day notice. The Agreement provides for licensing, installation and operation of updated Settlements Analyzer Module — a software application enabling tracking, accounting and settling Azusa's ISO- related activities. The module will be used in conjunction with the Scheduling Services agreement with the City of Riverside through which two additional modules - Downloader Module and the Shadow Settlement and Dispute Module, will become available to Azusa at no additional cost. FISCAL IMPACT The cost of the updated Agreement is $833.33 per month ($875 under the current agreement), payable on a month-to-month basis, and the Agreement can be terminated at any time without penalties by a 30 day written notice. Funds are budgeted to pay for this service. Prepared by: Yarek Lehr 010 LICENSE AND CONSULTING SERVICES AGREEMENT THIS LICENSE AND CONSULTING SERVICES AGREEMENT (this "Agreement") is made and entered into this day of , 2011, by and between Power Settlements Consulting and Software, LLC (hereinafter "Power"), a California limited liability company; and the City of Azusa (hereinafter "Licensee"), a municipal corporation duly authorized and existing under the laws of the State of California. RECITALS WHEREAS, Power is the owner of all right, title and interest in and to software, documentation and related information, including the intellectual property rights embodied therein, known as the SettleCore System (collectively the "Software") and as further defined in Section 1.1, below; WHEREAS, Licensee desires to install and operate the Software pursuant to the rights and licenses granted herein for Licensee's non-exclusive use of the Software, and use the documentation and related information for permissible purposes; and WHEREAS, Licensee desires that Power provide additional services to remotely operate the Software as consulting services (the "Consulting Services") as further described in Exhibit "A", attached hereto and incorporated by reference herein; and WHEREAS, Power is willing to grant such rights and licenses under the terms and conditions of this Agreement; NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows: Article 1 DEFINITIONS When used in this Agreement the capitalized terms listed below shall have the following meanings: 1.1 "Software." Software includes the SettleCore System, which is comprised of the Settlements Analyzer Module which is further described in Exhibit "A", and is used to view and report on the Licensee's settlement statements from the California Independent System Operator (the "CAISO"). Software is comprised of Object Code and Documentation that is installed on a server and accessed by the users on client computers. 1.2 "Settlements Analyzer Module." The functionality within the SettleCore system that is used to load the Licensee's (including entities to which Licensee is assigned as the License and Consulting Services Agreement June 27, 2011 Page 1 of 16 0 11 scheduling coordinator by the CAISO) CAISO settlement files and invoices, in the CAISO-issued XML format, to review and analyze the CAISO settlement file data, to perform ad-hoc charge code formula training, and to export the CAISO settlement file data to spreadsheets. 1.3 "Code." Computer programming code. If not otherwise specified, Code shall include both Object Code and Source Code. Code shall include Maintenance Modifications and Enhancements thereto if, when, and to the extent that such Maintenance Modifications and/or Enhancements are delivered to Licensee by Power under this Agreement or under any other agreement or arrangement between the parties. 1.4 "Source Code." Code in programming languages such as "Cr, including all database operations and procedures such as "SQL", plus all related development documents such as flow charts, schematics, statements of principles of operations, end-user manuals, architectural standards, and any other specifications that are used to create or that constitute the Software. Source Code shall also include the database tables and their design and layout, which are used by the Software. 1.5 "Object Code." Code in machine-readable form generated by compilation of Source Code and contained in a medium that permits it to be operated by Licensee. Includes the database and database design and layout provided in the Software. 1.6 "Documentation." User manuals and other written materials that relate to particular Object Code, including materials useful for operation (for example, user guides and training materials). Documentation shall include Maintenance Modifications and Enhancements thereto if, when, and to the extent that such Maintenance Modifications and/or Enhancements are delivered to Licensee by Power under this Agreement or under any other agreement or arrangement between the parties. 1.7 "Maintenance Modifications." Modifications, updates, or revisions made by Power to Code or Documentation that correct errors, support new releases of operating systems, or support new models of input-output ("1/0") devices with which the Code is designed to operate. 1.8 "Enhancements." Modifications, additions, or substitutions, other than Maintenance Modifications, made by Power to Code or Documentation that accomplish incidental, performance, structural, or functional improvements. Enhancements may consist of Basic Enhancements or Major Enhancements, as defined below: a. "Basic Enhancements." Enhancements that result from warranty or maintenance services or that otherwise accomplish incidental, structural, functional, or performance improvements for which Power does not generally impose a separate charge on Licensee. b. "Major Enhancements." Enhancements that result in substantial performance, structural, or functional improvements or additions, including substantial redesign or - License and Consulting Services Agreement June 27, 2011 Page 2 of 16 012 replacement of any parts of the Source Code, for which Power does generally impose a separate charge on Licensee. Article 2 LICENSE 2.1 Grant. In consideration of the fees payable to Power pursuant to Article 3 hereof, Power hereby grants to Licensee a revocable, non-exclusive right and license (the "License") to use and operate the Software to review and report on the settlement statements which are sent or assigned by the CAISO to the Licensee. 2.2 Restrictions. Licensee agrees to the following restrictions on the Software. Failure to adhere to these restrictions may result in the revocation of the License at the unilateral discretion of Power with or without notice to Licensee, except as specifically set forth herein: a. The Software may be installed by the Licensee at only one site to be approved in advance by Power. b. Licensee may not reproduce or transfer the Software, or any copy, adaptation, transcription, or merged portion thereof, except as expressly permitted by Power. Licensee's rights are non-exclusive and non-assignable. If Licensee transfers possession of any copy, adaptation, transcription, or merged portion of the Software to any other party, including, but not limited to, a successor in interest of Licensee's business that assumes all of the Licensee's obligations with respect to the Software, the Licensee's rights in the Software are automatically terminated. c. Licensee may (1) make a maximum of three copies of the Software in machine- readable form for non-backup purposes only; and (2) use the Software only for internal purposes (and not for service bureau work, multiple-user licenses or time- sharing arrangements). d. Power shall have sole and exclusive ownership of all right, title, and interest in and to the Software and all modifications and enhancements thereof prepared by Power (including ownership of all trade secrets and copyrights pertaining thereto), subject only to the rights and privileges expressly granted by Power hereunder. e. By accepting delivery of the Software Licensee acknowledges that Power claims and reserves all rights and benefits that are afforded under federal copyright law in the Software. f. The Source Code for the Software (and the information therein, to the extent not otherwise apparent in the Object Code and the Documentation) is a trade secret of Power. Licensee is not entitled to receive Source Code, and under no circumstances License and Consulting Services Agreement June 27, 2011 013 Page 3 of 16 may Licensee reverse-compile or reverse-assemble the Object Code. g. Licensee's obligations hereunder remain in effect for as long as it continues to possess or use the Software. h. Licensee shall not make any updates to the database used by the Software, including but not limited to updates to the data, tables, layouts, or schema. i. Licensee agrees that only employees of the Licensee shall be permitted to operate the Software and to access the database used by the Software. Any requests to operate the Software or to access the database used by the Software, by non-employees of the Licensee, must be approved by Power in email form. j. Licensee shall be responsible for maintaining Licensee's hardware and software, which is installed on the server and client that the Software is also installed on, are in proper working order. k. Licensee agrees that if the Agreement is Terminated, as further described in Article 8 Section 8.2, that the Software license is immediately revoked as of the termination date, and that the Licensee must immediately uninstall the Software, including all backup copies. Article 3 SOFTWARE MAINTENANCE 3.1 CAISO Initiated Changes. As indicated in Exhibit "A", Power shall deliver to Licensee an updated version of the Software each time that the CAISO initiates a change that affects the existing functionality of the Software. 3.2 Bugs Identified by the Licensee. As indicated in Exhibit "A", each time that the Licensee reports an error in the functionality of the Software ("Bug"), and Power verifies the validity of the Bug, the Bug shall be fixed no later than the end of the following calendar month. 3.3 Bugs Identified by Other Customers of Power. From time to time, Power shall issue updated versions of the Software which include Bug fixes identified by customers other than the Licensee identified in this Agreement. 3.4 Training. Power shall provide the following training to Licensee: a. Prior to the completion of the initial installation of the Software, at the Licensee's site, Power shall provide the Licensee with the level of training required to operate the Software. License and Consulting Services Agreement June 27, 2011 Page 4 of 16 014 3.5 Delivery of Maintenance Modifications and Basic Enhancements. Power shall deliver to Licensee, when and as prepared by Power in the course of its business, all Basic Enhancements and Maintenance Modifications arising from time to time, for inclusion in the Software. However, Major Enhancements will not be included within the Software or Consulting Services. Article 4 CONSULTING SERVICES 4.1 Consulting Services. As further described in Exhibit "A", Power shall provide the following Consulting Services to the Licensee on each business day, excluding federal and state recognized court holidays: (1) ensure that all required CAISO files are loaded into the Software. Power is not required to perform a minimum number of hours to complete the Consulting Services. The Consulting Services shall also include the following: a. Power shall perform the Consulting Services, offsite, through a secure VPN or through a Citrix connection. b. Power shall perform all Software upgrades and patches (i.e., new versions of the Software) for Licensee. Article 5 PAYMENTS 5.1 Software License Fee. In consideration of payment for the Consulting Services, the one- time Software license fee in the amount of Twenty-Five Thousand and no/100 Dollars ($25,000) will not be assessed by Power to the Licensee. 5.2 Software Installation Fee. In consideration of payment for the Consulting, the one-time Software installation fee in the amount of Five Thousand and no/100 Dollars ($5,000) will not be assessed by Power to the Licensee. 5.3 Software Maintenance Fee. In consideration of payment for the Consulting Service, the annual Software maintenance fee in the amount of Fifteen Thousand and no/100 Dollars ($15,000) will not be assessed by Power to the Licensee. 5.4 Consulting Services Fee. Licensee shall pay a Consulting Services fee in the amount of License and Consulting Services Agreement June 27, 2011 Page 5 of 16 015 Ten Thousand and no/100 Dollars ($10,000) to Power. In the event that Licensee (or in combination with those entities to which Licensee is assigned as scheduling coordinator by the CAISO) schedules an average of thirty-five or more scheduling resource ids during a calendar month of the Term, then monthly installment for such month, and each month thereafter during the term of this Agreement, shall be increased by an additional twenty-five percent (25%). 5.5 Continued Use of Software after Term Fee. If thirty (30) days or more prior to the expiration date of the Term of this Agreement Licensee does not enter into an agreement with Power to extend the Term of the Agreement by a minimum of one year from the expiration date of the Term of the Agreement, AND the Licensee does not permit Power to remove the Software from the Licensee's site then upon such expiration date of the Term of the Agreement Licensee shall make a payment in arrears, comprised of the Software License Fee plus the Software Installation Fee, which is Thirty Thousand and no/100 Dollars ($30,000). Additionally, if Licensee would like Power to continue to provide the Delivery of Maintenance Modifications and Basic Enhancements of the Software to Licensee, Licensee will be assessed the annual Software Maintenance Fee, which will then increase by five percent (5%) annually. 5.6 Medium of Payment. All payments are payable in U.S. dollars. 5.7 Consulting Services Payment Due Dates; Late Fees; Interest. Licensee shall pay to Power in monthly installments of Eight Hundred and Thirty-Three and 33/100 Dollars ($833.33), which are due in advance on the first calendar day of each month for the current month during the Term. The July 2011 installment payment shall be due on July 16, 2011 in the amount of $416.67. In the event any payment due to Power is not paid within five days of its due date, a late fee of 10% of the amount owed shall be due and payable to Power. Additionally, interest at the rate of ten percent (10%) per annum shall accrue on the unpaid payment from the date due until paid. Article 6 CONFIDENTIAL INFORMATION 6.1 Confidential Information. Confidential Information means all information in the possession of a Party which has value to that Party (or to a third Party to whom the Party in possession owes a duty of confidentiality), which is not generally known in the industry, which is kept reasonably confidential by the Party in possession and which is known or should be known to the other Party to be of a confidential nature. By example and without limitation, Confidential Information includes any and all information concerning teaching techniques, processes, software, database designs, formulas, trade secrets, inventions, discoveries, improvements, research or development and test results, specifications, data, know-how, formats, marketing plans, business plans, strategies, forecasts, unpublished financial information, budgets, projections, and customer and License and Consulting Services Agreement June 27, 2011 Page 6 of 16 016 supplier identities, characteristics, and agreements. 6.2 Protection of Confidential Information. During the term of this Agreement and for 5 (five) years thereafter, each Party agrees to take all steps reasonably necessary to hold in trust and confidence the other Party's Confidential Information. Each Party agrees to hold such Confidential Information in strict confidence, not to disclose it to third parties or to use it in any way, commercially or otherwise, other than as permitted under this Agreement. Each Party agrees not to allow any unauthorized person access to such Confidential Information, either before or after termination of this Agreement, without the prior written consent of the other Party and without court order. Each Party agrees to limit the disclosure of Confidential Information to employees or independent contractors with a need to know, who have been advised of the confidential nature thereof, and who have acknowledged in writing the express obligation to maintain such confidentiality. 6.3 Non-Confidential Information. Notwithstanding the other provisions of this Agreement, nothing received by either Party from the other Party will be considered to be Confidential Information if (i) it has been published or is otherwise readily available to the public other than by a breach of this Agreement; or (ii) it has been rightfully received by the non-disclosing Party from a third party without confidential limitations. Article 7 REPRESENTATIONS AND WARRANTIES 7.1 Right and Authority. Power represents and warrants that: a. it is the owner of the Software and Documentation (including all intellectual property rights therein under copyright, patent, trademark, trade secret, and other applicable law); b. it has the full and sufficient right and authority to grant the rights and licenses granted herein; c. the Software and Documentation have not been published under circumstances that have caused loss of any U.S. copyright therein; and d. the Software and Documentation, to the best of Power's knowledge, do not infringe any copyright or other intellectual property right of any third party. 7.2 Adequacy of Software and Documentation. Power represents and warrants that: a. the Software and Documentation are and shall be reasonably understandable and License and Consulting Services Agreement June 27, 2011 ; • Page 7 of 16 017 reasonably usable by the Licensee's users. 7.3 Conformity, Performance, and Compliance. Power represents and warrants that: a. the Software and Documentation to be delivered by Power hereunder have been prepared in a workmanlike manner and with professional diligence and skill, b. such Software and Documentation will reasonably function on the machines and with operating systems for which they are designed, as further explained in Exhibit "A", and c. such Software and Documentation conform to the specifications and functions relating thereto. 7.4. Limitation of Warranties. Power does not assume any responsibility for any processes performed by Licensee utilizing the Software or the Consulting Services. Power shall not be deemed to make, or to have made, any express or implied warranties of any kind, character or description, including, but not limited to, fitness for a particular purpose or the warranty of merchantability concerning the Software or the Consulting Services, except as expressly stated in this Agreement. Article 8 TERM 8.1 Term of Agreement. This Agreement shall become effective beginning on July 16, 2011, and shall terminate at 12:01 a.m. Pacific Standard Time on June 30, 2012 (the "Term"). By mutual agreement of the Parties, the Term of this Agreement may be further extended in the future by up to an additional three years, after June 30, 2012, provided that the Consulting Services Fee shall increase at the rate of no more than 5% annually. 8.2 Termination. This Agreement may be terminated upon the occurrence of any of the following events: a. Termination At Will. Power may terminate the Agreement without cause upon thirty(30) days written notice to Licensee. Licensee may terminate the Agreement without cause upon (30) days written notice to Power, provided that the notice is .issued no fewer than 90 days after the effective date of the Term of Agreement. b. Termination by Mutual Agreement. Licensee and Power may terminate or License and Consulting Services Agreement June 27, 2011 Page 8 of 16 018 modify the terms of this Agreement by written agreement executed by both parties. c. Termination For Cause. In addition to the foregoing, Power may terminate this Agreement, or modify the Agreement, at any time for "just cause", herein defined as the happening of any of the following occurrences or acts: (i) A receiver for Licensee is appointed or applied for, or a petition under any bankruptcy chapter is filed by or against Licensee, or Licensee becomes insolvent or makes an assignment for the benefit of creditors, or is unable to pay its debts as they become due, or, if there is any levy, attachment or similar action that is not vacated or removed by payment or bonding within ten (10) days of such levy or attachment; or (ii) Licensee is charged with unethical or illegal practices or acts thereby jeopardizing, in the opinion of Power, Power's good name and good will; or (iii) Licensee grossly fails to perform a material condition or delegation of this Agreement that adversely and substantially affects the interests of Power, with immediate effect by giving written notice of termination to Licensee. Licensee, at its option, may terminate this Agreement in the event Power grossly fails to perform a material condition or delegation of this Agreement that adversely and substantially affects the interests of Licensee. Such termination may be effected only through written notice, specifically identifying the breach on which termination is based. Following receipt of such notice, Power shall have 30 days to cure such breach, and this Agreement shall terminate in the event that such cure is not effected by the end of such period. 8.3 Survival. In the event of the termination of this Agreement, in whole or in part, the provisions of Articles 6, 9, and 10 shall survive and continue in effect. Article 9 LIABILITY LIMITS 9.1 Exclusion of Consequential Damages, Etc. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL, INDIRECT, SPECIAL, OR INCIDENTAL DAMAGES, INCLUDING BUT NOT LIMITED TO FAILURES OR LIMITATIONS OF THE SOFTWARE OR CONSULTING SERVICES, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH POTENTIAL LOSS OR DAMAGE. License and Consulting Services Agreement June 27, 2011 Page 9 of 16 019 Article 10 INDEMNIFICATION 10.1 Indemnification by Licensee. Licensee shall indemnify, defend, and hold harmless Power and its officers, directors, shareholders, members, employees, agents, representatives, and customers (collectively, "Power Indemnitee") against all liability, claims, costs, damages, and expenses incurred by Power Indemnitee relating to or arising from or concerning the Software or the Consulting Services. Licensee agrees to reimburse Power for any amounts owed hereunder immediately upon demand, or alternatively, at the election of Power, to promptly and directly pay any such amounts with respect to any matter for which Power is indemnified pursuant to this Agreement (including attorney's fees by Power in defense or prosecution of any claim to which this Agreement applies) to such person or entity as Power designates. Any amount to be paid by Licensee shall be paid to Power or designee, within ten (10) days following written demand therefore by Power. 10.2 Indemnification by Power. Power shall indemnify, defend, and hold harmless Licensee and its officers, directors, shareholders, members, employees, agents, representatives, and customers (collectively, "Licensee Indemnitee") against all liability, claims, costs, damages, and expenses incurred by Licensee Indemnitee relating to or arising from or concerning the Software or the Consulting Services. Power agrees to reimburse Licensee for any amounts owed hereunder immediately upon demand, or alternatively, at the election of Licensee, to promptly and directly pay any such amounts with respect to any matter for which Licensee is indemnified pursuant to this Agreement (including attorney's fees by Licensee in defense or prosecution of any claim to which this Agreement applies) to such person or entity as Licensee designates. Any amount to be paid by Power shall be paid to Licensee or designee, within ten (10) days following written demand therefore by Licensee. Article 11 ADDITIONAL SETTLECORE MODULES FOR LICENSEE THROUGH CITY OF RIVERSIDE 11.1 Azusa Services. Licensee is a customer of City of Riverside with respect to scheduling within the CAISO. Licensee has requested the use of additional SettleCore modules, including the ISO Downloader Module and the Shadow Settlement and Dispute Module through its contract with City of Riverside, such that City of Riverside pays the additional consulting and licensing costs for these two SettleCore modules directly to Power, rather than Licensee paying for the consulting and license cost for these two SettleCore modules directly to Power. The third- party agreements for the use of these two additional SettleCore modules have been approved License and Consulting Services Agreement June 27, 2011 Page 10 of 16 020 between Licensee and City of Riverside as well as the corresponding agreement between City of Riverside and Power. In addition to the use of the two SettleCore modules, Power will also be remotely loading additional CAISO data and running shadow settlement routines in the two additional SettleCore modules, on behalf of Licensee, through a consulting service between City of Riverside and Power, as described in the agreement between City of Riverside and Power. The totality of the above-described arrangement is termed the "Azusa Services". 11.2 Liability Limits and Indemnification Between Licensee and Power Related to the Azusa Services. The responsibilities for the consulting services and license of these two additional SettleCore modules are included in the agreements between Licensee and City of Riverside and between the City of Riverside and Power. Accordingly, other than liability limits and indemnification, the terms and conditions for these additional two SettleCore modules related to the Azusa Services will not be included in this Agreement. Accordingly, in this Agreement and any subsequent amendments, Licensee agrees that Article 9 and Article 10 of this Agreement, shall include not only the Software in this Agreement but shall also include the portion of the Azusa Services that involves Licensee and Power but not City of Riverside. Article 12 MISCELLANEOUS 12.1 Freedom of Action. This Agreement shall not be construed to limit Licensee's right to obtain services or software programs from other sources, nor shall this Agreement be construed to limit Power's right to grant others any further non-exclusive right or license of the Software and Documentation. This Agreement alone establishes the rights, duties, and obligations of Licensee and Power with respect to the subject matter hereof. Licensee shall have no right or interest whatsoever in any software of Power other than the rights and licenses in the Software and Documentation granted herein, whether such software is conceived or developed by Power before, during, or after the course of Power's performance of this Agreement. 12.2 Independent Contractor. With respect to the Consulting Services performed by Power, Power shall be deemed to be an independent contractor. 12.3 Rights and Obligations After Notice of Termination. If Power gives notice of termination of this Agreement, or if it becomes known that this Agreement will otherwise terminate in accordance with its provisions, Licensee shall return to Power all Software, Documentation and other items of property owned by Power forthwith. 12.4 Notices. Unless otherwise stated herein, all notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, delivered or sent by overnight courier and shall be deemed received upon the earlier of: (i) If personally delivered, the date of delivery to the address of the person to receive such notice; (ii) If License and Consulting Services Agreement June 27, 2011 Page 11 of 16 021 mailed, three (3) business days after the date of posting by the United States post office; and (iii) If sent by overnight courier, when delivered to the specified address. To Power: Power Settlements Consulting and Software, LLC 250 West First Street Suite#256 Claremont, CA 91711 Telephone Number: (626) 676-9387 Facsimile: N/A Electronic Mail: david.dan@powersettlements.com To Licensee: Notice of change of address shall be given by written notice in the manner detailed in this section. Rejection or other refusal to accept, or the inability to deliver because of changed address of which no notice was given, shall be deemed to constitute receipt of the notice, demand, request or communication. 12.5. Required Actions of Power and Licensee. Power and Licensee agree to effectuate the intent of this Agreement. 12.6 Captions. Any captions to, or headings of, the section or subsections of this Agreement are solely for the convenience of the parties hereto, are not a part of this Agreement and shall not be used for the interpretation or determination of the validity of this Agreement or any provision hereof. 12.7 No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Agreement shall not be deemed to confer any rights upon, nor obligate any of the parties hereto, to any person or entity other than the parties hereto. 12.8 Amendment. The terms of this Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. 12.9 Waiver. The waiver or failure to enforce any provision of this Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. 12.10 Applicable Law. The terms and provisions of this Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to its conflicts of laws' provisions. 12.11 Entire Agreement. This Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between Power and Licensee as to the subject matter hereof. No subsequent agreement, representation or License and Consulting Services Agreement June 27, 2011 Page 12 of 16 022 promise made by either party hereto, or by or to any employee, officer, agent or representative of either party shall be of any effect unless it is in writing and executed by the party to be bound thereby. 12.12 No Presumption. Each provision of this Agreement has been independently and freely negotiated by both parties as if this Agreement were drafted by both parties. In the event of any ambiguity in this Agreement, the parties waive any presumption or rule requiring or permitting interpretation of said ambiguity against or in favor of either party. 12.13 Severability. If any provision of this Agreement is held invalid or unenforceable, the remainder of this Agreement shall nevertheless remain in full force and effect. If any provision is held invalid or unenforceable with respect to particular circumstances, it shall nevertheless remain in full force and effect in all other circumstances. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. POWER: Power Settlements Consulting and Software, LLC, a California limited liability company By: David Dan, President LICENSEE: By: Printed Name: Title: Date: EXHBIT A Article 1 CONSULTING SERVICES License and Consulting Services Agreement June 27, 2011 Page 13 of 16 023 1.1 Daily Consulting Services. Power shall provide the following daily consulting services to the Licensee on each business day, excluding holidays: a. Ensure that the Settlements Analyzer Module has imported the Licensee's (or those entities to which Licensee is assigned as scheduling coordinator by the CAISO) CAISO files; and b. Communicate, via email or verbally, with a Licensee user that the Daily Consulting Service has been performed. 1.2 Limitation of the Daily Consulting Services. Power shall provide the Daily Consulting Services within the following manner: a. Power is not required to perform a minimum number of hours to complete the Consulting Services. b. Power shall perform the Consulting Services, offsite, through a secure VPN, or Citrix connection, or Webex Remote Host. 1.3 Software Maintenance Consulting Services. Power shall provide the Software Maintenance Consulting Services, as described below: a. Power shall perform all Software Maintenance Modifications (i.e., updated versions of the Software, which are issued to the customers of Power; include bug fixes) for the Licensee; and b. Power shall only perform the Software Maintenance Modifications in a test environment and a production environment. Article 2 OBLIGATIONS OF THE LICENSEE FOR THE CONSULTING SERVICES AND SOFTWARE 2.1 Obligations of the Licensee. In order for Power to perform the Consulting Services and for the Software to function as required, the Licensee shall be required to fulfill the following obligations. Failure of the Licensee to meet the obligations below, (1) may result in adverse performance of the Software and Consulting Services, and (2) shall not relieve the Licensee of any obligations of Payment for the Software and/or Consulting Services for the Term. a. Licensee shall be responsible for providing a production environment, which the License and Consulting Services Agreement June 27, 2011 Page 14of16 024 Software will be installed on, which is comprised of: • A server, which the Software is installed on, with hardware comprised of (1) a minimum of two Intel Xeon dual core processors or a higherversion, (2) a minimum of four gigabytes of RAM, and (3) two 1000 gigabyte hard drives, where one of the hard drives is the primary hard drive and the other hard drive is a backup hard drive. • The following software shall be installed on the server with the Software (1) an operating system that is one of the following: Microsoft Windows 2003, Windows Server 2008, Microsoft XP, Microsoft Vista, or Microsoft Windows 7, (2) a database consisting of either the Standard SQL Server 2005 or 2008 edition or the Enterprise SQL Server 2005 or 2008 edition, (3) the Microsoft .Net Framework version 3.5 or a higher version, and (4) the Winzip application for compressing and uncompressing files. • Each client terminal that accesses the server with the Software shall have the following hardware: (1) an Intel processor, which shall be a Pentium P4 processor or a higher version, (2) have a minimum of two gigabytes of RAM, and (3) a hard drive with at least twenty gigabytes of free space. • Each client terminal that accesses the server with the Software shall have the following software: (1) an operating system that is one of the following: Microsoft Windows 2003, Windows Server 2008, Microsoft XP, Microsoft Vista, or Microsoft Windows 7, (2) the Microsoft .Net Framework version 3.5 or a higher version, and (3) Microsoft Excel 2007 or a higher version. b. Licensee shall be responsible for installing and maintaining the hardware and software described above. c. Licensee shall be responsible for the availability of the hardware and software described above. d. Licensee shall be responsible for ensuring that Power has full administrative privileges to the server with the Software (includes full administrative access to the Microsoft SQL Server 2005 or 2008 database). e. Licensee shall be responsible for installing and maintaining a VPN (virtual private network) or for providing a secure Citrix connection for Power to provide the Consulting Services. f. Licensee shall be responsible for ensuring that the hardware is in proper working order. License and Consulting Services Agreement June 27, 2011 Page 15 of 16 025 g. Licensee shall be responsible for providing a minimum bandwidth of 0.5 Mbps on the VPN, or Citrix connection, at all times. h. Licensee shall be responsible for providing that the VPN or Citrix connection is secure. i. Licensee shall be responsible for ensuring that Power has access through the VPN, or Citrix connection, or Webex Remote Host during normal business hours, five days a week. License and Consulting Services Agreement June 27, 2011 026 Page 16 of 16 ra ti-JM r,nT CONSENT CALENDAR TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: AWARD OF A THREE-YEAR CONTRACT FOR AIR CONDITIONING SYSTEM MAINTENANCE TO ONTARIO REFRIGERATION SERVICE, INC. RECOMMENDATION It is recommended that the Utility Board approve the award of a three-year maintenance services contract for air conditioning system maintenance for four Light & Water facilities to Ontario Refrigeration Service, Inc. in the amount of$21,096 for three years ($7,032 per year). BACKGROUND The existing air conditioning maintenance contract with Ontario Refrigeration Service, Inc. for Light & Water Administration Building will expire on July 1, 2011 and the contract for the Electric Yard and Water Yard will expire on October 1, 2011. In an effort to continue maintaining the air conditioning system and provide a comfortable working environment for staff, the following four quotes were received pursuant to the Azusa informal or alternative purchasing procedure as set forth in section 2-516 (b) of the Azusa Municipal Code for these three locations plus the addition of Hsu-Canyon Filtration Plant and the lowest responsive and responsible bidder was Ontario Refrigeration Service, Inc. (maintenance scope of work attached for reference): Companies Amount for Three Years Maintenance Ontario Refrigeration Service, Inc. (Ontario, CA) $21,096 DMS Air(Azusa, CA) $22,800 Danco Companies (Covina, CA) $24,192 Johnson Controls, Inc. (Whittier, CA) $24,765 Ontario Refrigeration has been providing satisfactory maintenance service to Azusa Light & Water since 2001 and their competitive service costs have been affirmed through this recent bidding process. 027 June 27, 2011 AC Maintenance Contract Page 2 FISCAL IMPACT The total fiscal impact is $21,096 for three years ($7,032 per year) starting July 1, 2011. Sufficient funds are budgeted for upcoming fiscal year in the respective divisions as follows: Divisions Annual Amount Account Number L&W Administration Building $2,988 31-40-702-935-6835 Hsu-Canyon Filtration Plant $1,636 32-40-722-707-6493 Water Yard $1,040 32-40-723-759-6815 Electric Yard $1,368 33-40-735-910-6815 Future year budgets will include contract amounts apportioned similarly to above. Prepared by: Steven Yang, Senior Management Analyst Attachment: Ontario Refrigeration-Maint S 02© Ontario Refrigeration CUSTOMIZED SERVICE PROGRAM (CSP) Commercial Alf Condttroning Heating &Controls Registered Quotation Number Presentation Date Page Number PC77671-A May 02, 2011 2 of 6 Under our CUSTOMIZED SERVICE PROGRAM, Ontario Refrigeration shall provide the Customer with a guaranteed performance based agreement entailing every aspect of professional preventive and predictive maintenance services. The program begins with a detailed equipment inventory by component. This inventory is entered into our computer data bank of maintenance tasking as recommended, at minimum, by the equipment manufacturer. This tasking is then supplemented by our own experience of equipment operation and service requirements in the state of California since 1958. The program is further customized with the Customer's individual application(s), operating run-time, and specific needs of the Customer's occupants. Included in the program for the attached Inventory of Equipment is the following: • SYSTEM(S) OPERATIONAL ANALYSIS Travel and jobsite labor including vehicle and living expense necessary to test existing operation and performance characteristics of the equipment. Inspections in the form of non-destructive testing, vibration and noise monitoring, chemical analysis, and routine visual inspections will be performed to ensure that the system(s) are in proper operating condition and to identify any potential system(s) failures. As customized for your system(s), the following inspections typify these services as applicable: Visually Inspect the Following: Physically Check and/or Test the - fan assemblies Following: - belts & sheaves - lubrication requirements - motor mounts & vibration pads - oil sump, heaters & temperatures - electrical connections & contactors - starter operation - heating & cooling coils - water flows - filter media & racks - motor operating conditions - sight glass condition - suction & discharge pressures - bearings - flow switch operation - spray nozzles & pans - control interlocks - ignitor & flame assembly - damper operation - heat exchangers - external interlocks - compressor sections - motor voltage & amperages - condensing sections - refrigerant charges - heating sections - system(s) leaks - humidifiers & strainers - oil & fluid levels - seals & packaging - pressure & temperatures - condensate drains & pans - outside air intakes - flame composition - refrigerant pump down - flue stack assembly - crankcase heaters 029 Ontario Refrigeration CUSTOMIZED SERVICE PROGRAM (CSP) Commercial Al: Conditioning Heating&Controls Registered Quotation Number Presentation Date Page Number PC77671-A May 02, 2011 3 of 6 ■ PREDICTIVE & PREVENTIVE MAINTENANCE Travel and jobsite labor including vehicle and living expenses essential to ensure efficient operating conditions and extended equipment life. Preventive Maintenance working in tandem with Predictive Maintenance is performed to detect early signs of deteriorating performance and to predict potential system(s) failures. These services diagnose and solve equipment problems often before they occur. Preventive Maintenance is performed on an ongoing basis and is scheduled with little or no equipment downtime with its primary objective aimed at system(s) durability, reliability, efficiency, and safety. As customized for your system(s), the following tasks typify these services as applicable: Calibration: Secure and Tighten: - temperature controls - motor terminals - operating & safety controls - control terminals - humidity & pressure controls - piping clamps - transmitter & receiver gauges - line fittings - economizer controls - mounting hardware - electrical connections Adjustment: - equipment panels - purge system(s) - motor mounts - superheat - vibration pad nuts & bolts - damper & valve linkages - damper sections - unloaders - belt tensions; replace annually Cleaning: - fan rpm's - control devices - chemical feed equipment - electrical contactors - gas pressure regulators - condenser coils (with water) - combustion air ratios - evaporator coils (as required) - set points - fan blades & impellers - ignitor & flame rod assembly - pilot & burner orifices - sump floats - ignitors - condensate pans Alignment: - tower basins - sumps & floats - belt sheaves - baffles & fill - pulleys - nozzles & passages - coil fins - equipment areas - belt drives - burner orifices Vibration: Painting and Surface Preparation: - damper linkages - as required, to help prevent corrosion and - fan bearings deterioration of exterior equipment surfaces - axial vane drives - pumps - motors --Q3O Ontario Refrigeration CUSTOMIZED SERVICE PROGRAM (CSP) L'o Air Corit/ilro ing Registered Quotation Number Presentation Date Page Number PC77671-A May 02,2011 4 of 6 ■ PROGRAM ADMINISTRATION Ontario Refrigeration will be responsible to administer, monitor and update all aspects of the service provided under this agreement. A complete set of documents will be generated, including computerized maintenance task schedules, inventory records, and all other documentation required for establishing operating trends and further corrective measures. Detailed Service and/or Maintenance Reports will be left with Customer after every service visit. Ontario Refrigeration will act on Customer's behalf to provide any documentation the EPA may require regarding compliance with the Clean Air Act. -431 31 • Ontario Refrigeration SPECIAL SERVICES/PROVISIONS Commercial Air Conditioning Heating& Controls Registered Quotation Number Presentation Date Page Number PC77671-A May 02, 2011 6 of 6 This is not an inspection proposal under which the equipment listed is merely inspected, oiled, and adjusted on a quarterly basis. This proposal includes a computerized preventative maintenance program under which Ontario Refrigeration technicians perform necessary maintenance on the equipment according to its age, size, and run-time in order to ensure proper system operation and efficiency. This results in fewer equipment failures, increased equipment life, and maximum energy savings. Customer to provide filters that will be installed by Ontario Refrigeration. This agreement is subject to the General Conditions on the reverse side of page one. uf92iD2 032 exu i;'o. z e a' t. t. •: .r,Y .,Jeer ns� 3 ., $a.isc4 AZUSA LIGHT R WATER PUBLIC HEARING TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SA UTILITY BOARD FROM: GEORGE F. MORROW, UTILITIES DIRECTOR DATE: JUNE 27, 2011 SUBJECT: PUBLIC HEARING AND ADOPTION OF AZUSA'S 2010 URBAN WATER MANAGEMENT PLAN RECOMMENDATION It is recommended that the Utility Board approve attached resolution adopting the 2010 Urban Water Management Plan Update (UWMP), and direct staff to submit the UWMP to the California Department of Water Resources. BACKGROUND The Urban Water Management Act (Part 2.6 of Division 6 of the California Water Code) requires that every five years b, eginning in 1985 in years ending in five (5) or zero (0), all wholesale and retail water suppliers that provide water (directly or indirectly) to over 3,000 customers, or more than 3,000 acre-feet per year, prepare or update their Urban Water Management Plans (UWMP). Preparation of this UWMP update was approved by the Utility Board at its October 25, 2010 regular meeting. SA Associates prepared the Azusa 2010 UWMP Update, and a hardcopy of the draft plan was posted for public review at the City Library, City Clerk's office and front counter of Azusa Light & Water office in early June as part of the public notice and review process. CDs of the 2010 UWMP Update were also mailed to surrounding cities and water agencies for review and comment. (No comments have been received to date). Once the revised plan is adopted by the City Council, it is then o e submitted to the State of California Department of Water Resources by December 31 (this ear extended to June30) of the quinquennial year, where it will be available for review and re of rence at the Department of Water Resources and California State Library. Due to the size of the 2010 UWMP Update, it is being distributed with this agenda report to Utility Board members on CD. This version of the UWMP, by legislative requirement, contains ever more detail than past versions and addresses sources of water supply for Azusa Light & Water (ALW) in the next five years. Also included in this update is discussion about past, current and projected water use; conservation measures currently in use by the City and additional measures available; future water supply opportunities; and water shortage management. 033 2010 Urban Water Management Plan June 27, 2011 Page 2 Major additions to this 2010 update of the UWMP include the following: • New requirements, now contained in the Act, and known as SBx7-7, mandate that per capita water use within an urban water supplier's service area must decrease by 20%by the year 2020. The penalty for not achieving the 20%reduction in demand is a loss of eligibility for state water grants and loans. An incremental goal of 10%by 2015 has been set by SBx7-7. • The urban retail water supplier shall include in its plan a baseline per capita water use,interim water use target and compliance with daily per capita water use using methodologies and criteria set by DWR and the California Urban Water Conservation Council. ALW's water supply for the next five years will be drawn from three sources: • San Gabriel River water will be diverted to recharge underground water basins for pumping during the year and for treatment at ALW's Hsu—Canyon Water Treatment Plant. • State Project Water will be supplied to ALW by the San Gabriel Valley Municipal Water District(SGVMWD), a wholesale agency of which ALW is one of four members. SGVMWD delivers untreated water to the underground water basins for pumping and in emergencies will be utilized for treatment at the new water treatment plant. • State Project Water and Colorado River Water is delivered to ALW by the Upper San Gabriel Valley Municipal Water District(USGVMWD)as untreated water for pumping and treatment, and as treated water to the southern portion of ALW's water system.USGVMWD is a member agency of the Metropolitan Water District of Southern California, one of the largest water agencies in the country. The UWMP discusses conservation measures that ALW currently has in place,such as the Municipal Code requirements for water conservation in household and landscaping use, and provides discussion of alternative conservation measures that ALW will look into for the future. The UMWP also discusses the quality of water available to ALW and provides an assessment of the reliability of ALW's water supplies. Furthermore,in accordance with the Model Water Efficient Landscape Ordinance adopted by the California Department of Water Resources,in 2010 the City Council of Azusa adopted Section 88.34.080 of the Azusa Municipal Code codifying the City of Azusa Water Efficient Landscape Regulations. In general, ALW will use this Urban Water Management Plan as its guide in the utilization of the water supplies available in the future,and to plan for and manage water shortages which may occur in the future. FISCAL IMPACT The adoption of the Urban Water Management Plan Update has no direct fiscal impact. Prepared by: Chet F. Anderson, P.E., Assistant Director- Water Operations 034' RESOLUTION NO. RESOLUTION OF THE CITY COUNCIL/UTILITY BOARD OF THE CITY OF AZUSA ADOPTING THE YEAR 2010 URBAN WATER MANAGEMENT PLAN WHEREAS, Division 6, Part 2.6 of the California Water Code mandates an update of the City's Urban Water Management Plan every five years; and WHEREAS, the Urban Water Management Plan is required to be presented at a public hearing; and WHEREAS, following the public hearing the Urban Water Management Plan is to be adopted by the City Council by resolution and thereafter submitted to the Department of Water Resources; NOW, THEREFORE, THE CITY COUNCIL/ UTILITY BOARD OF THE CITY OF AZUSA DOES HEREBY FIND AS FOLLOWS: Section 1. The 2010 Urban Water Management Plan has been properly prepared in conformance with California State Water Code; and Section 2. The 2010 Urban Water .1anageme\nt Plan has been properly considered at a public hearing conducted by Vie Azusa City Council / Utility Board as required by California State Water Code; and Section 3. That the 2010 Urban Water Management Plan is hereby adopted and staff is hereby directed to submit the Plan to the California State Department of Water Resources. PASSED, APPROVED AND ADOPTED this 27th day of June, 2011. MAYOR I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the City Council/ Utility Board of the City of Azusa at a regular meeting thereof held on the 27th day of June, 2011. AYES: COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS: CITY CLERK n 3 5 ui Q Si U co vo rCL z fi w 2 w Q z Q bkO W Q coz Q v) m = cc < LL N 0 .t CN� ` o - -4 3 $ ..,,,,,.: _ ,,,_ ., . . , ..A ,.,f„,;: .... ,.... Iti. ,..,... ,, w , _... to �v_ �k 7 _ ; 14\ .. ,,..,._ Z V. ' SA ASSOCIATES Background 6 • .in Water Management Planning Act (Act) Amendments to the Act Water Conservation Act of 2009 (SBx7-7 -Steinberg) Who & When s required to prepare an Urban Water .itagement Plan (UWMP)? Urban water suppliers 3,000 customers 3,000 acre-feet per year(AFY) UWMPs are prepared every 5 years (2000, 2005, etc.) • Extension given to 2010 UWMPs c' Adopted by City Council by July 1s' t. Submitted to DWR by July 31St 1 Z (Mld) aa1eM lt,pn esnzd se unnou)J s! walsAs Jalenn s,A1ij •eaae aoinaas pue 'uoileindod 'elep alewip `uualsAs aalenn s,��ij age uo uopetwolui Aaopanpoil.0 •uoildope pue 'uoia.eu!pJoop `ssaao.J dWMfl atp uo uoRewiojui punoi: De_. uoppnpoi u ! Z uo!.Jas 2u!uueld AJua2u! uo' L sa.inseeN uo!lenaasuoJ •9 2u!uueld Al!!!ge!!al •s spueWaa ialeM 17 A IIenO sawddns saDanos JaleM uonanpoilu • diAIM(1 s,Al!J Jo slualua Sa1VIOOSSVVS SA ASSOCIATES ALW Service Area ' iter Service Area is mostly Built Out at t around 1% population growth Service area Population approximately 110,000 in 2010 - Water System: e 300 miles of mains c 1 USGVMWD Connection _ • 22,000 Connections (" 11 active wells -- • 13 Storage Reservoirs c 5 Pressure Zones LEGEND cay M Ax1IY -EwyW A. EanWry City M ci.wen / / Water Service Area ,/ includes the City of `l Azusa&5 Other — Cit ofAzusa `Municipalities 210 Fwy I i __ I _r _a 6 ; ri � I i v J „ I( lO Fwy 3 SA ASSOCIATES Via Section 2 ater Supply Resources - y s water supply sources Groundwater Surface Water - Imported water ` 'Description of the City's Imported supply sources and description of the City's groundwater basin. • Projected supply outlook and discussion of potential alternative supplies Groundwater extracts groundwater from the Canyon roundwater Basin and the Main San Gabriel Groundwater Basin (by terms of the judgment the Canyon Basin is part of the Main San Gabriel Groundwater Basin) City has 12 total wells (11 active wells and 1 inactive well) 4 SA ASSOCIATES r�l ,-- 4, ALW Service Area , -ct 1/4 „. Raymond G- - Basin ---7,/ , too Main San Gabriel I' �F Basin ,_K .ea? - {. 4,0 , . .,, ....14iffif . / !r /s / 'a Puente � Basin* + .\ (A � a 1 111 „,....";.'6`, Main San Gabriel Groundwater Basin - (Spreading Grounds located above Canyon Basin) Spreading Grounds - `i-4;`-” -'s 'y Jr-- , .� ,' ti. ‘:"%."-.- ....-".11,,.,:f .t.- y , 5 SA ASSOCIATES A ' Surface Water ,, t obtains surface water from the San Gabriel -r urface water accounts for up to 27 percent of LW's water supply - YSurface water is treated at the Joseph F. Hsu Filtration Plant Morris & San Gabriel Reservoirs Along San Gabriel River • { A t i 6 SA ASSOCIATES _..„. Imported Water amento-San Joaquin Bay Delta Colorado River :: About two-thirds of imported water (67%) comes -,- rom the Bay Delta and one-third (33%) comes ,,—,......- - - 'from the Colorado River „..- ._.‘ Colorado River Aq educt - - — V -: - , •1760 ., *,, ''''s f...., . - V 1 lle *--''-‘1Wr *--..--7: - 'a,- ..s'.• • .-....;\ - is, - - . -r ..,;:todp - • r-- ..,. -_, / /- •---r r Sacrame.ntci-SanioVq7",”.nilk-e'ita.'' -:-.--:-.--- California Aqueduct ...---'—--11M,--- --,t---1.-- ,--------- - __ •____ '' ' (; ' . . .....„ 7 SA ASSOCIATES Section 3 Water Quality of groundwater Quality of surface water Quality of imported water sources Effects of water quality on management and supply reliability MWD's F.E. Weymouth Filtration Plant -Alt.- NB La Verne, CA • VIE _ 4 =71E1- -7" 4,1-1-1101016' ' - 111. 11161110•414, - ‘e- • - q115 , • . t 8 SA ASSOCIATES Section 4 40. Water Demands �` er demands (total consumption and water -` characteristics) otal Potable Demand = Water Sales +Unaccounted for Water (i.e. system losses, etc.) City Potable Demand over last 5 years Average of about 21.3 Million Gallons Per Day Water Conservation Act of 2009 (SBx7-7) Sx7-7 (Known as 20/20 Plan) Some Urban Water Agencies are to reduce use by up to 20% by 2020 :`. Some agencies are exempt Low water users under 100 gallons per person per day City Projected 2020 Target • City's Target Conservation is 168 Gallons Per Capita Per Day (GPCD) 2009 water is 179 GPCD and 2010 water use is 165 GPCD City will need to make sure target conservation is achieved 9 SA ASSOCIATES Section 5 Reliability Planning `e lability of water supply for all climatic conditions -- Normal year — Single dry year — Multiple dry years e Impacts of droughts on the region and City �•_ ^ take Oroville: Severe Drou.ght Conditions In 2009 10 SA ASSOCIATES Section 6 Conservation Measures ; ' onservation Measures in accordance with the UWMP Act City either implements or partners with Upper District and San Gabriel Valley MWD to implement conservation measures Conservation measures include low flow showerheads, high efficiency washing machines, low flush toilets, public education, school programs, water waste prohibitions .. Section 7 Contingency Planning enservation Ordinance No. 2446 4 stages of water shortages Phase I — Mandatory Measures Implemented Phase 2 — Mandatory; 10% Reduction Phase 3 — Mandatory; 20% Reduction Phase 4 - Mandatory; 30% Reduction Regional Storage reservoirs provide emergency storage (Diamond Valley Lake) 11 SA ASSOCIATES MWD's 800,000 AF Diamond Valley Lake Provisions of Ordinance No. 2446 Prohibitions on water use and penalties Measures to overcome impacts on water sales revenue Methods to determine actual reductions in water use 12 SA ASSOCIATES -4401r Meeting November, 2010 , ft Submittal March2011 'ised Draft Submittal May, 2011 odic Hearing/Adoption June 27, 2011 ubmit to DWR/State Library By July 27, 2011 Questions 13 v - �r • A7 USA f.11T a J.arrV SCHEDULED ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE A UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: AWARD CONTRACT TO UTILITY FINANCIAL SERVICES (UFS) TO PERFORM AN ELECTRIC VEHICLE RATES & SERVICE STUDY RECOMMENDATION It is recommended that the Utility Board: 1) Approve the selection of Utility Financial Services (UFS) to perform an Electric Vehicle Rates and Service Study, and 2) Award a Professional Services Contract to UFS in an amount not-to-exceed Nine Thousand Nine Hundred Fifty Nine ($9,959). BACKGROUND During the past months, electric vehicles (EV) are being delivered to potential buyers in Southern California. At least one Azusa resident has taken delivery of an electric vehicle. These electric vehicles contain batteries which require charging. Depending on the type of chargers, duration and frequency of use, charging equipment can demand a significant amount of electricity. The EV charging pattern and time of charging was not considered when the prevailing electric rates of Azusa Light &Water were developed. In view of this deficiency, rate schedule(s) will need to be established and adopted that will be applicable for EV charging "time of use" either at homes or at commercial/business locations. Rate setting involves performing some analysis prior to formal adoption and implementation in order to ensure that rates adequately cover the cost of service and accomplish other policy objectives such as encouraging EV's to charge during low electrical load and cost periods. Electric Vehicle Rate Study June 27, 2011 Page 2 Staff solicited proposals from consulting companies who specialize in rate studies. Proposals were received on June 7, 2011 and are listed below. COMPANY AMOUNT 1) Utility Financial Solutions (UFS) $ 9,959.00 2) Burns & McDonnell $19,000.00 3) MBMC Inc. $19,835.00 4) Energy Source $24,900.00 5) Black & Veatch $45,000.00 6) SAIC Inc. $55,000.00 7) Shpigler Group $67,000.00 Staff reviewed the lowest cost proposal as submitted by UFS and determined that it meets the requirements of the RFP. Moreover, UFS recently completed another consulting service (Electrical Financial Study) with Azusa Light & Water and is already familiar with some of the data needed to complete and expedite the study. Thus, staff is recommending that the Utility Board approve the selection of UFS and award the contract in the amount of$9,959 excluding the customary 10% contingency allowance. FISCAL IMPACT Funding for this activity will be provided by Electric Account No. 6399. Prepared by: F. Langit Jr. —Assistant Director—Electric Operations 037 AZUSA LIGHT&WATER REQUEST FOR: ELECTRIC VEHICLE RATES AND SERVICE STUDY June 4,2011 Utility Financial Solutions,LLC 185 Sun Meadow Court Holland,MI USA 49424 (616)393-9722 Email:mbeauchamp@ufsweb.com Submitted Respectfully by: Mark Beauchamp,CPA,CMA,MBA President,Utility Financial Solutions 038 4;fri Utility Financial Solutions, LLC June 4th, 2011 Mr. Federico Langit,Jr. AZUSA LIGHT&WATER 729 North Azusa Avenue Azusa, CA 91702 Mr. Langit Jr.; We are pleased to submit two original proposals to provide an Electric Vehicle Rates and Service Study as requested in the May 18th RFP from the Municipal Electric Utility of the City of Azusa. Our proposal is based on our prior experience in developing time differentiated rate structures and developing electric vehicle rates for utilities in around the nation. We are instructors for the cost of service studies for the American Public Power Association and instruct participants on development of electric vehicle rates. We also have completed over 300 electric rate studies for municipal utilities around the nation. Utility Financial Solutions (UFS) will provide you with the HIGHEST QUALITY SERVICE WITHIN AN AGREED-UPON TIMEFRAME and has the personnel available to meet your needs. The study will be managed by Mark Beauchamp and is expected to take approximately 12 weeks to complete after receipt of requested information. The not-to-exceed total for this project is $9,959 and includes a 10% discount for APPA membership. This quote includes all out-of-pocket expenses. UFS is an internationally known firm with a long standing relationship and history of assisting municipalities with financial analysis and are recognized experts in the utility field. Our group and the project team assigned to this engagement are composed of highly qualified, experienced, and knowledgeable professionals who remain current on all issues facing municipal utilities. We are regularly requested speakers at seminars at the regional and national level including the American Public Power Association and instructors for the intermediate and advanced electric cost of service courses and financial planning courses offered through the American Public Power Association. We are presenters for sessions coordinated by the APPA on a variety of pricing methods including incentive pricing to promote new development, conservation pricing, key accounts pricing, TIME OF USE and development of connection fees and charges. UFS would like to be a resource to you for many years in the future. Our success is dependent on the quality and timeliness of the services provided to utilities. WE ARE COMMITTED to Azusa Light& Water's complete satisfaction. Our prior experience in providing the requested services allows us to conduct a cost effective and efficient rate study. We appreciate the opportunity to submit this proposal and look forward to discussing it with you. If you have questions or need additional information, please contact me at 616-393-9722. Sincerely, Utility Financial Solutions, LLC Mark Beauchamp CPA, MBA, CMA (616)393-9722 039 TABLE OF CONTENTS Cover Letter Table of Contents Company Qualifications 1 Work Plan—Understanding of 5 Work Plan 6 Data Request 11 Scope exclusions/addenda 12 Deliverables 13 Schedule of Completion 14 Staff assigned 15 Hourly Rate Schedule 21 040 AZUSAWrig •• - Tilil,f\•TMn,*!tirdi.IHai\,I I ELECTRIC VEHICLE RATES AND SERVICE STUDY COMPANY QUALIFICATIONS Utility Financial Solutions is best qualified to meet the needs of the Azusa Light & Water. UFS has a long standing relationship and history of assisting municipalities with financial analysis for Electric, Water, and Wastewater utilities and are recognized experts in the utility field. Our group and the project team assigned to this engagement is composed of ENGINEERS, ACCOUNTANTS, ECONOMISTS AND FINANCE PROFESSIONALS who remain current on all issues facing electric, water and wastewater systems. UFS has completed similar rate design studies for municipally-owned utilities around the country and our reference list is second to none. Utility Financial Solutions provides consulting services to assist publicly-owned utilities in meeting their strategic and financial objectives. Services are designed to ensure complete client satisfaction and a commitment that: • Services will be COMPLETED IN THE AGREED UPON TIMEFRAME • Services are delivered WITHIN BUDGET for services requested • Services provided will meet or EXCEED CLIENT EXPECTATIONS • Services will be UNBIASED AND INDEPENDENT RECOMMENDATIONS provided to the utility Our experience and commitment to publicly-owned utilities ensures that we understand the issues they face and that we have assisted in providing a variety of services including: • Electric, water & wastewater cost of service, financial plans, long-term rate track and rate designs for over 200 utilities • Worked with Public Service Commissions, Board of Directors, and City Councils: • Preparing rate case documents to justify revenue requirements related to the following: • Utility expenses and revenue (usage) projections • Allocation of costs to customer classes • Minimum cash reserve levels • Long term financial projections • Long term rate track • Rate Design and potential impacts on various customer classes • Provided Expert Witness Services on justification of charges to Public Service Commissions, State Legislation subcommittees, District courts, Board of Directors and City Councils • Developed & negotiated special contracts for the following: • ELECTRIC TOU RATES for commercial and industrial customers • Negotiated special contracts for wholesale water and wastewater services • Developed special rates for water use for large customers with special characteristics • Provided assistance to ensure existing water contracts are consistent with contract language • Other Non-Rate Related Services for the following: • Developed line extension policies to identify portion of costs to be paid by utility and portion to be recovered from customers for electric, water and wastewater utilities • Development of special fees and ancillary service charges • Cost reduction strategies and benchmarking analysis for utilities Phone Page 1 UFS Proposal to AL&W (616) 393-9722 www.ufsweb.com 041 AZUSA 4:01-te ELECTRIC VEHICLE RATES AND SERVICE STUDY COMPANY QUALIFICATIONS As a result of our specialized industry knowledge we are frequently called upon to share our experience with others in the industry. We have given presentations at regional and national seminars regarding electric, water and wastewater pricing, electric restructuring, electric unbundling, telecommunications, and other issues. Some of our more recent presentations are listed below. Conference Date Organization Coping with Financial Challenges in 2011 American Public Power Association Periods of Declining Sales National Conference Industry RATE TRENDS & Future 2011 American Public Power Association Rate Structures National Conference Overview of Utility Financial 2011 American Public Power Association Operations for Boards National Conference Utility Revenue Requirements Rate Making for Utility 2011 American Public Power Association Boards/Councils Webinar Sessions Cash Reserves Smart Grid and NEW RATE 2010 American Public Power Association DESIGNS for the Future National Conference Rate Desi ns for the Future 2010 American Public Power Association g National Conference 2003, 2004, 2005, Financial Planning for Municipal 2006, 2007, 2008, American Public Power Association Utilities 2009, 2010 National Conference 2003 2004 2005 Advance Electric Cost of Service and 2006, 2007, 2008, American Public Power Association Rate Design 2009, 2010 National Conference Public Policy Makers Understanding 2005, 2006, 2007, National Conference of Financial Planning 2009 American Public Power Association ..... Pricing Energy Efficiency Programs .- ....,.. ,.,., 2009 National Conference onference................................,...., and impact on Customer Rates American Public Power Association Developing Economic Development 2008 Broadband Conference Rates for Customers American Public Power Association SPECIAL RATES for Key Account 2007 Customer Connections Workshop - Customers American Public Power Association Phone Page 2 UFS Proposal to AL&W (616) 393-9722 www.ufsweb.com 042 -w A L l_? S A +S► ELECTRIC VEHICLE RATES AND SERVICE STUDY COMPANY QUALIFICATIONS UFS compiled a reference list of projects that have been completed within the last five years and are similar in scope to the request of the RFP issued by the Azusa Light&Water: Rochester Public Utilities, Rochester, Minnesota Client Contact: Bryan Blom; Finance Director Phone/Email: 507-280-1616/BBIom@RPU.ORG Scope of Work: Completion of electric cost of service study, long-term financial plan and rate design for existing rates including development and recommendations on time of use rates and marginal cost analysis. Reviewed and made recommendations on the following special rates: 1) Electric Car Charging Stations 2) Power Cost Adjustment Recommendations 3) Residential Geo Exchange Rate Analysis 4) Water Pumping Rate Analysis 5) Transformer Ownership Discounts 6) Ratchet Clause Recommendations 7) Special analysis and recommendations on street lighting rates Services completed in 2011. City of Bay City, Michigan Client Contact: Phil Newton; General Manager Phone: 989-894-8348 Scope of Work: Completion of an electric cost of service study, long-term financial plan and rate design. Development of time of use rates and special rates for large industrial customers, rates for electric car charging stations and presentation of results to City Commission. Services provided since 2004. Wadsworth Electric Department, Wadsworth, Ohio Client Contact: John C. Easton; General Manager Phone: 303-335-2777 Scope of Work: Conducted electric cost of service and unbundling studies, rate design and presentation to Board of Directors. Developed time of use rates for all customer classes including residential for electric car charging. Services provided in 2010. Phone Page 3 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 043 NgAZU : :, �/rS ELECTRIC VEHICLE RATES AND SERVICE STUDY COMPANY QUALIFICATIONS Platte River Power Authority,Colorado Client Contact: John Bleem;Division Manager Phone: 970-222-3958 Scope of Work:Review of wholesale power supply charges to members using both a long run marginal costs and average embedded cost and DEVELOPMENT OF TIME OF USE PRICING STRUCTURE. Work with members and staff to develop an agreed upon rate structure to minimize the financial risks to Platte River Power Authority,minimize the impacts on wholesale members and send a more efficient price signal. Services provided in 2011. Lake Worth Electric Department,Lake Worth Florida Client Contact: Rebecca Mattey;General Manager Phone: 561-586-1670 Scope of Work:Conducted electric cost of service and unbundling studies,rate design,and presented results to City Commission. Developed time of use rates for all customer classes including residential for use in electric car charging. Service provided since 2002. Mesa,Arizona Client Contact: Pedro Serrano;Energy Resources Coordinator Phone: 1-480-644-6898 Scope of Work:Completion of electric cost of service/unbundling study,long term financial projection and rate design for the City of Mesa. Services included development of time of use rates,net metering rates and feed in rate tariffs. Services completed July 2010. City of Sturgis,Sturgis Michigan Client Contact: John Griffith;General Manager Phone: 269-659-7218 Scope of Work: Completion of electric cost of service study,long-term financial plan and rate design. The initial study completed in 2005 with subsequent follow ups. Identified time based rates using marginal cost price signals from generation units and power supply contract.Presentation of results to City Commission. Phone Page 4 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 044 A11. HA ELECTRIC VEHICLE RATES AND SERVICE STUDY WORK PLAN-UNDERSTANDING OF Azusa Light & Water (AL&W) provides electric services to approximately 15,000 accounts and is requesting proposals for an electric vehicle rate and service study. The objectives are to assist AL&W in research of electric utility incentives, rate practices and electric service requirements for Electric Vehicle charging. Additionally, regional market and AL&W power costs are to be documented on a time-of-day and seasonal basis as part of the analysis to formulate EV rates. To achieve the primary objective the following specific tasks were identified in the Request for Proposal: 1. Research and summarize the existing and/or planned EV rates and incentives at other private and public electric utilities in California, including how the costs of distribution system upgrades (if required)are handled. 2. If electric utilities in other states have established an EV rate and incentive program that is highly regarded as a model or best practices, please describe. 3. Review and document the cost of power supply for Azusa Light &Water and for the California wholesale power market by time of day and season. 4. If Azusa Light&Water were to establish time-of-use rates for EV charging, what time periods and rate alternatives should be considered and why? 5. Formulate criteria to evaluate EV charging rate methodologies,and recommend one or more EV charging rate methodologies for consideration by Azusa Light&Water.What time periods, prices and terms are most appropriate? How might the cost of distribution system upgrades, including metering, be handled? 6. Discuss the pros and cons of Azusa Light&Water offering various incentives for local electric customers for purchasing/charging EV's locally. Compare cost of operating an EV to cost of operating internal combustion engine powered vehicle under different EV charging rate scenarios. 7. What EV metering and electric service scenarios should be considered (and perhaps favored) by Azusa Light &Water,for instance single meter, dual meters,single meter with sub-meter, single service, dual service,etc. 8. How might this service approach vary based on the electric demand or type of charging unit? 9. Would any of the recommendations regarding EV rates,time periods, incentives, metering or other terms&conditions differ for charging at,or by, local business entities or for service to community charging stations? Phone Page 5 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 045 ELECTRIC VEHICLE RATES AND SERVICE STUDY WORK PLAN There is tremendous momentum in the United States and in other countries behind electric vehicles (EV)and its potential for mass adoption. A critical player in the success of the EV is the Electric Utility. The Electric provider will need to determine how best to balance customers'demands for reliability with affordability and helping to ensure operating costs are recovered from all customers including customers using EV. The development of appropriate pricing incentives to help ensure customers charge EVs during optimal times of the day is one of the critical financial challenges facing electric utilities today. The financial success of the Utilities and the economics to purchase an electric vehicle is dependent on the proper price signal sent by the electric provider. We have listed below each task requested by AL&W and our proposed work plan to complete the analysis. 1. Research and summarize the existing and/or planned EV rates and incentives at other private and public electric utilities in California, including how the costs of distribution system upgrades (if required)are handled. The push toward residential inverted block rates helps reduce electric consumption but result in higher electric rates paid by customers purchasing EVs and may limit the success of EVs. Coupling this with the additional investment needed to upgrade the distribution infrastructure has resulted in Public Service Commission's including the California PUC to adopt rules to identify and help remove the barriers that limit the widespread deployment of Plug-in Hybrids or EVs. Our research will include documentation on the implementation process, rate methodology, current success of the programs, rules on customer paid costs and utility paid costs and tariff rules implemented. This process will have three components to be finalized during the initial kick off meeting: 1. Research the California PUC rules due out in July 2011 considering rates currently offered in California including: a. San Diego Gas and Electric EV and PG&E and document the process, rules, rates,and cost sharing. 2. Research other programs around the nation including Georgia Power, Dominion Power (Virginia) and document the implementation process, and the rules. 3. Research international programs including British Gas and Electric. 4. Use APPA's web service to identify public power systems rates, rules and cost sharing 2. If electric utilities in other states have established an EV rate and incentive program that is highly regarded as a model or best practices,please describe. Other states have implemented rates for EVs and developed time differentiated rate structures. The most common methods currently employed are on-peak, off-peak and super off-peak rates. We will research rates and rules through discussion with PUCs in other states and use the resources of APPA,and our existing contacts in the industry to identify the following: 1. Are the rates based on costs that recover all related cost for power supply, transmission and distribution Phone Page 6 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 046 mAZUSA ELECTRIC VEHICLE RATES AND SERVICE STUDY WORK PLAN 2. Are the rates developed to cover only marginal costs for distribution or designed to fully recover distribution related infrastructure 3. Are the meter costs and improvements to the customer's electric system paid by the customer or shared between the customer and utility 4. Type of metering infrastructure used by the utility including smart grid 5. Is the EV use separately metered 6. Other technologies currently or planned to be employed by the utility 3. Review and document the cost of power supply for Azusa Light&Water and for the California wholesale power market by time of day and season. AL&W has a number of generation resources including San Juan; Hoover, Palo Verde Nuclear Plant; Hydro;Wind and Garnet and sells excess revenue into the Market. We will review the power supply costs and recommend the methodology that should be considered including: 1) Opportunity Costs—Revenue AL&W could receive from the Power Supply Market if the power was sold into the Grid 2) Internal Costs—Embedded—Averaged cost by hour by hour using AL&W's existing resources 3) Internal Cost-Short Run Marginal—Cost the EV's usage using the marginal production costs using existing resources 4) Internal Costs—Long Run Marginal—Cost the EV's using the marginal cost to install and operate the next unit of generation 4. If Azusa Light & Water were to establish time-of-use rates for EV charging, what time periods and rate alternatives should be considered and why? Depending on the recommended method from three above we will discuss and recommend the time of use periods and if the period should be based on the power supply markets or AL&W internal production usage and costs. This includes time of use time periods from wholesale markets,time of use periods used by other California utilities for EVs,time of use periods specific to AL&W. We will review and make recommendations on time of use time periods and the type of rate structure including but not limited to the following: • Option One—On Peak; Off-peak; Super Off peak • Option Two—On Peak; Off Peak • Option Three—On Peak; Off peak; Critical peak • Other identified through discussion with management and research of existing rates and methodologies Phone Page 7 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 047 AZUSA ELECTRIC VEHICLE RATES AND SERVICE STUDY WORK PLAN 5. Formulate criteria to evaluate EV charging rate methodologies, and recommend one or more EV charging rate methodologies for consideration by Azusa Light&Water. What time periods, prices and terms are most appropriate? How might the cost of distribution system upgrades, including metering,be handled? Development of the Rate Methodology needs to consider the following: • Power Production Costs from number three above • Time periods to use from number four above • Distribution Cost Recovery for AL&W's current Operation, Maintenance and Replacement of the distribution system • Cost of Improvements needed including metering and customer specific improvements (Service lines to customers) • Cost of system improvements required to handle the additional customer loads including line and system transformers • Impact on existing rate payers to help ensure existing ratepayers are not harmed by the rates charged to EVs (really? Full cos wouldn't we?)yes, should be considered in methodology to be self-sufficient as a rate class • The social concerns to protect the environment through the use of cleaner technologies • Management and City's concerns on promoting EVs in AL&W's service territory • Impacts wind generation may have on future power supply rates during the off peak time periods (Really?Whole separate study?)this maybe something that should be considered since wind tends to come from off-peak times,we are not committing to do this study • Should the EV's rate cover marginal costs of production but less than the fully embedded cost of production and distribution • How transmission costs impact the rates paid by EVs • Should AL&W provide public charging stations for customers with EVs • How much value the additional load will provide existing ratepayers and how this value can be used to cover a portion of the initial costs of system and metering improvements (really? whole separate"line extension calc" would need a really good estimate on demand and load of EVs)yes,this should be considered in a rate methodology but is not committing us to actually do the study • What pricing methodologies,time of use periods,and rules and regulations are being used or considered in California and by other utilities from one and two above Several rate methodologies can be derived to best provide EV customers with fair, reasonable and cost based rate while benefiting existing ratepayers through the additional sales. We will research and provide recommendations to provide EV customers a price signal that recovers the cost of power supply, distribution operation, maintenance, replacement and customer specific improvements.The addition of EV customers to the system should benefit existing ratepayers over time provided price signals and rates are set properly and the rules and regulation are set based on the contribution margins provided by EV customers. We will discuss the various scenarios that help ensure recovery of any investments made by the AL&W while sending price signals that encourage EV customers to use electricity during low cost time periods. Phone Page 8 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 048 AZusA ELECTRIC VEHICLE RATES AND SERVICE STUDY WORK PLAN 6. Discuss the pros and cons of Azusa Light & Water offering various incentives for local electric customers for purchasing/charging EVs locally. Compare cost of operating an EV to cost of operating internal combustion engine powered vehicle under different EV charging rate scenarios. UFS will provide AL&W with benefits, either positive or negative, of encouraging EVs to be charged locally either at the customer's premises or at public charging stations. We will discuss the costs and pricing methods used by UFS in development of rates for public charging stations. Development of a sample rate is listed below: Total Power Payment Cost Taxes and Supply in Lieu of Distribution Facilities Authorization before processing Session Type kW kWh's Costs Tax Charges Costs Fees Taxes fees 16 hour trickle charge 1.9 30.7 2.88 0.21 0.34 2.22 0.50 6.15 0.91 8 hour trickle charge 1.9 15.4 1.44 0.10 0.17 2.22 0.50 4.44 0.66 4 hour trickle charge 1.9 7.68 0.72 0.05 0.09 2.22 0.50 3.58 0.53 4 hour rapid charge 7.2 30.7 2.88 0.21 1.16 2.22 0.50 6.97 1.04 2 hour rapid charge 7.2 14.4 1.35 0.10 0.58 2.22 0.50 4.75 0.71 1 hour rapid charge 7.2 7.2 0.68 0.05 0.29 2.22 0.50 3.74 0.56 The operating costs of an electric vehicle will be estimated and measured against the current operation and maintenance cost of an internal combustion engine. To complete this analysis we will complete the following: 1. Literature on cost comparisons 2. Discussions with our contacts in the automotive industry 3. How electric prices impact the economics of an EV UFS will research and evaluate how EV operation costs are affected by use of various charging methods available and measure each against operating costs of internal combustion engine vehicles. This will be conducted at various usage (mileage) levels and commuting practices. To do this we will utilize various sources of current public information and document those resources within the report. What about battery life and disposal? Enviro impacts of that? - I would rather keep it to just daily operating costs rather than a all out comparison of the two 7. What EV metering and electric service scenarios should be considered (and perhaps favored) by Azusa Light & Water, for instance single meter, dual meters, single meter with sub-meter, single service, dual service, etc. The method used to meter EVs usage is impacted by current and anticipated metering infrastructures of AL&W. UFS will provide the positive and negative benefits of various metering methods for the proposed rate methodologies. We will discuss the possible metering scenarios and the positive and negatives and recommend the most advantageous approach for AL&W. Phone Page 9 UFS Proposal to AL&W (616) 393-9722 www.ufsweb.com 049 7t ' ` .A S ELECTRIC VEHICLE RATES AND SERVICE STUDY WORK PLAN 8. How might this service approach vary based on the electric demand or type of charging unit? The ability to quickly and efficiently charge an EV depends on the service feed into the customer's facility. The demands created by EVs can be substantial and some customer types may create demands that require additional investments. AL&W may consider use of demand charges or increased customer charges to recover the cost of the additional investments depending on the service level required for the charging unit and the metering technology used by AL&W. We will review and recommend possible alternative methods that reflect the demand created on the system based on the type of charging unit. 9. Would any of the recommendations regarding EV rates, time periods, incentives, metering or other terms & conditions differ for charging at, or by, local business entities or for service to community charging stations? As stated in item six above an EV charging station requires a customer to charge over a period of time leaving them temporarily stranded. This provides local businesses an opportunity to provide a service to EV customers. Restaurants can serve food, Malls provide shopping, and Hotels provide optimal charging rates with off-peak power supply rates and a place to rest. Based on our development of public car charging station rates combined with research of other utilities in California and around the nation we will recommend the following: 1. If time periods should be different than residential 2. What metering technologies should be considered 3. What incentives, or terms and conditions should be varied Each of these may be influenced by the customer's current rate class such as Commercial (energy only) or Commercial TOU (demand and energy). We will research and recommend the pricing methodologies and metering structure for each rate class. Phone Page 10 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 0 5.0 LUSA ELECTRIC VEHICLE RATES AND SERVICE STUDY DATA REQUEST Below is an itemized list of data that will be requested of AL&W to support the items listed in the scope above: DATA REQUIREMENTS Based on discussion with management and staff,we will prepare an information request that will include all necessary information to complete the study. Below is an example list of data that will be requested of the Utility. • Cost of assets to install the following typical meter configurations o Commercial TOU meter(demand&energy) o Commercial meter(energy only) o Residential meter(energy only) o Residential TOU meter(demand &energy) o Secondary meter off a current meter(energy only) o Secondary TOU meter off a current meter(demand &energy) • Model used to develop the current AL&W TOU rate (if available) • City and local business objectives towards EV public access • Typical AL&W distribution requirements in residential areas • Projected number of EV customers(if available) • Projected demand and energy of EV customer class (if available) • Projected Load Factor of EV customer class(if available) • Cost to install typical charging station (if already in area) • Load profile information from last AL&W TOU rate model • Power costs by resource from last AL&W TOU rate model • Any significant changes in power supply since last TOU rate design Phone Page 11 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 051 mAZUSA I. lin Finnrn!C.r1t1.i.1 1 ELECTRIC VEHICLE RATES AND SERVICE STUDY SCOPE EXCLUSIONS/ADDENDA UFS is requesting no Scope Exclusions or Addenda Phone Page 12 LIES Proposal to AL&W (616)393-9722 www.ufsweb.com 052 • AZLTSAAlfig I.tJ v Flrvan.n:ti.datnrvi.1.1 ELECTRIC VEHICLE RATES AND SERVICE STUDY DELIVERABLES Deliverables are listed below for the Electric Vehicle Rates and Service Study as defined in the AL&W RFP. • Draft#1 Executive Summary for Management in Microsoft Word format o Background and final analysis to be discussed for the following: i. Summary of current EV rates in California ii. Best practices for EV rates throughout the US iii. Analysis of AL&W power supply iv. Identify time periods and rate alternatives to consider v. Provide recommendation and criteria for EV charging rate methodologies vi. Review pros and cons for charging EV's locally vii. Evaluate operating costs between an EV and a combustion engine vehicle viii. Analyze various metering and service scenarios ix. EV charging methods and their effects on system demand x. Analyze EV charging and its role with community and local businesses • Draft#2 Executive Summary for Management in Microsoft Word format o Include follow up and revisions identified in Draft#1 • One electronic and requested number of hardcopies of Final Report Phone Page 13 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 053 AZU A S ELECTRIC VEHICLE RATES AND SERVICE STUDY SCHEDULE OF COMPLETION Our tentative project schedule below is for completion of the EV analysis. This schedule will be finalized during an initial project kick-off meeting with management. Task Expected Completion - Twelve Weeks Initial Meeting— Preparation of Information Request Week One Completion of Information Request by Client Week Two Research of existing California EV rates Week Three Research of existing US EV rates Week Four Analysis of current AL&W TOU rate Week Five Analysis of current CAISO power supply by time and season Week Six Evaluate EV charging methodologies Week Seven Comparison of EV and internal combustion vehicles Week Eight Review metering options in sending price signal to customer Week Nine Discuss charging methods and effects on system demands Week Ten Research on local incentives for charging units Week Eleven Report, Recommendations& Management Review of Draft Week Twelve THIS PROPOSED SCHEDULE IS DEPENDENT ON COOPERATION OF VARIOUS DEPARTMENTS WITHIN THE CITY TO COMPLETE THE INFORMATION REQUEST IN A TIMELY MANNER Phone Page 14 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 054. mAZUSA S ELECTRIC VEHICLE RATES AND SERVICE STUDY STAFF ASSIGNED We have put together a project team with the knowledge and experience to successfully meet your requirements. The TEAM HAS OVER 64 YEARS OF COMBINED EXPERIENCE performing similar studies for municipal utilities. This provides Azusa Light&Water with the experience to creatively solve financial and operational issues and help ensure financial stability in future years. The project team that would be assigned to this engagement are recognized national experts and completed over 300 cost of service and rate design studies in 22 US states,Guam and the Caribbean. Azusa Light&Water Mark Beauchamp CPA,CMA,MBA Project Manager Dawn Lund Rate Manager Dan Kasbohm Terry Carson Joan Bakenhus Rate Analyst Rate Analyst Rate Analyst Support Staff UTILITY FINANCIAL SOLUTIONS STAFF UFS staff consists of accountants,engineers and CPA's,additional staff is available if needed to ensure the timely completion of the project. Their role is dependent on work load and timing of projects and will be used in various stages of the cost of service study. Phone Page 15 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 055 AZUSA ELECTRIC VEHICLE RATES AND SERVICE STUDY STAFF ASSIGNED Mark Beauchamp, CPA, MBA, CMA, Project Manager Mark has over 27 years of experience in a utility environment. He possesses degrees in Water Purification Technology, Accounting, and a Masters Degree in Business. He holds a Class "A" license in sanitary sewer treatment from the State of Michigan, the highest license attainable and is a licensed water plant operator. He has completed cost of service and rate studies for over 200 municipal systems around the nation, and served as an expert witness in rate cases around the county. Prior to starting his own consulting practice, he held a number of positions with one of the largest municipal systems in Michigan and a national consulting firm. Brief overviews of his responsibilities are listed below: • Completed over 200 Electric Cost of Service and Rate Design studies in 22 states. • Served as expert witness before regulatory agencies, governing bodies of municipal utilities and State Legislators • Served as expert witness for investor-owned utility on pole attachments • Developed marginal cost based rates for utilities • Developed seasonal and time of use rates • Developed special rates for standby, interruptible, special contracts, economic development • Negotiating and implemented wholesale water and sanitary sewer contracts • Experienced in pricing electric line extension fees and system development charges • Designing competitive cost based rates for electric utilities, including real time pricing and wholesale rates • Developed "Utilities Telecommunication Guidebook" for the American Public Power Association • Preparation of econometric forecasting models to project future loads and resources of electric utilities,joint action agencies, and power pools. • Presented information before bond rating agencies to improve or maintain utility bond ratings • Financial evaluations to determine the economics and rate impacts of anticipated capital improvement projects • Preparing information for FERC to dispute open-access tariffs filed by investor owned utility • APPA Instructor for "Advanced Cost of Service and Electric Unbundling" • APPA Instructor for "Financial Planning for Municipal Utilities" Mark is a Certified Management Accountant and Certified Public Accountant. He is recognized as a national expert in developing cost of service, unbundling and rate design studies for utilities and Phone Page 16 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 056 A Z U 5 A .�•- l ttlrt4 Frna+xial fi..luue.nw t.E i' ELECTRIC VEHICLE RATES AND SERVICE STUDY STAFF ASSIGNED has spoken at several seminars regarding utility issues including cost of service studies for water and sanitary sewer utilities, benchmarking costs, marginal cost analysis, and electric cost of service and unbundling. Mark has the following industry involvement: • Member of the American Public Power Association • Member of the American Water Works Association • Member of the Institute of Management Accountants • Speaker at national conferences on Financial Planning for Municipal Utilities, Pricing for Water Utilities, Pricing Fiber Optic backbone systems, Unbundling Electric Rates, and Ways to Attract and Retain Customers • Author of articles appearing in national magazines and newsletters regarding pricing fiber optics, unbundling electric rates, and designing water rates • Served on the Pricing and Market Analysis Committee, Task Force on Competitive Rate Designs, and Task Force on Open-Access Transmission Tariffs through the American Public Power Association Phone Page 17 UFS Proposal to AL&W (616) 393-9722 www.ufsweb.com 057' : ZL; SA TJFS ELECTRIC VEHICLE RATES AND SERVICE STUDY STAFF ASSIGNED Dawn Lund,Rate Manager Dawn has 16 years experience in pricing and marketing utility services and is experienced in pricing water,sanitary sewer,electric,refuse,and telecommunication services. Dawn worked with a large municipal utility and held positions as Cost Analyst,Marketing and Communications Specialist,and Cost and Rate Specialist. Dawn has completed over 60 water,wastewater and telecommunication cost of service and rate design studies. Dawn has a degree in Accounting and has the following experience: • Development of long-term sales and expense projections for electric,water,and sanitary sewer utilities • Development of long-term financial plan and rate track for electric utilities • Completed over 50 electric cost of service and unbundling studies • Completed over 70 cost of service analysis for Water,Wastewater,Trash and Telecommunication Utilities • Development of electric rate designs to meet financial and social objectives of Utility • Development of power(fuel)cost adjustments for electric utilities • Development of connection charges for water and wastewater utilities based on the equity method and consistent with Michigan Supreme Court decision • Review and recommend changes to ordinances related to utility operations • Development of fees for utility services • Business plan development for telecommunications and pricing of fiber services to customers • Determining high strength surcharge rates for sanitary sewer treatment plants consistent with EPA requirements • Determining appropriate allocations of overhead costs between utility services • Development of marketing plans for utilities • Development of special rates for electric utilities including Net Metering, Economic Development and Time of Use • Determination of minimum cash reserve requirements for utilities • Experienced in pricing electric line extension fees and system development charges • Presentations to City Councils and Board of Directors for approval of utility rates and proposed rate track Phone Page 18 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 058 AZUSA /-tiffig ELECTRIC VEHICLE RATES AND SERVICE STUDY STAFF ASSIGNED • Joan Bakenhus, Rate Analyst Joan has 15 years experience working with municipal utilities and has a degree in Business Administration. Joan has worked as a Rate Analyst for one of the largest public power systems in the nation (Lincoln Electric System) and for Utility Financial Solutions since 2006. Joan is experienced in development of long-term financial plans, rate design models and cost of service studies for electric, water and wastewater utilities. Joan's experience includes: • Working with Utilities to identify information requirements to complete cost of service and financial plans. • Set up and develop utility revenue requirements, cost of service program and utility revenue proof. • Development of long-term financial forecasts for water, wastewater, and electric utilities to determine the amount and timing of rate adjustments • Balancing and set up of models for development of cost of service and rate design for water, wastewater and electric utilities to determine commodity and customer charges • Responsible for analysis, preparation and updating cost of service models for a number of electric, water and wastewater utilities • Development of rate design models for electric, water and wastewater utilities • Development of rate surveys • Balancing of sales with revenue to help ensure proper billing statistics are used in cost of service models Phone Page 19 UFS Proposal to AL&W (616) 393-9722 www.ufsweb.com 059 AZUSAdaffg ELECTRIC VEHICLE RATES AND SERVICE STUDY STAFF ASSIGNED Dan Kasbohm, Rate Analyst Dan has 6 years experience with Utility Financial Solutions. He has a degree in Engineering and has been employed in the automotive manufacturing industry for 16 years. Dan is experienced in development of time of use rates, load research data for electric utilities, long-term financial plans, power cost adjustment models, rate design models and cost of service studies for electric, cable, water and wastewater utilities. Dan's experience includes: • Development of cost of service studies for electric, cable, water and wastewater utilities • Development of long-term financial forecasts for water, wastewater, and electric utilities to determine the amount and timing of rate adjustments • Managing professional, technical, and contract staff • Balancing models for development of cost of service and rate design for water, wastewater and electric utilities to determine commodity charges and customer charges • Assisted in developing econometric models and use of statistical analysis for forecasting • Assisted in the development of rate design models • Development of rate surveys for Utility Financial Solutions • Balancing of sales with revenue to help ensure proper billing statistics are used in cost of service models • Development of electric TOU models to analyze large load data files • Development of inclining bloc rate models to determine projected revenues with ability to adjust block size, fixed monthly rate, usage block rates and varying rates of elasticity • Assist in the development of Power Cost Adjustment models to project and balance power costs with actual monthly billings • Develop power cost projections • Prepared filing to Public Utility Commission Phone Page 20 UFS Proposal to AL&W (616)393-9722 www.ufsweb.corn 060 Xige11°- ELECTRIC VEHICLE RATES AND SERVICE STUDY HOURLY RATE SCHEDULE Project Fees Prices,terms, and conditions are good for a period of 90 days from date of opening. Payment will be made through submission of invoice which itemizes the work performed. "Total not to exceed amount" includes all out of pocket expenses. This proposal includes a management review via conference call and no on-site meetings are required. ELECTRIC VEHICLE RATES AND SERVICE STUDY Project Rates Average Services Phase Hours Manager Manager Analyst Hourly Rate Amount Initial Project Meeting 3.0 1.0 1.0 1.0 $ 158 $ 475 Data Request 2.0 - 1.0 1.0 115 230 California Current EV Rate Research 1 7.0 1.0 2.0 4.0 129 905 U.S.Current EV Rate Research 2 7.0 1.0 2.0 4.0 129 905 Analyze Azusa TOU rate model and TOU period 3 5.0 1.0 2.0 2.0 141 705 Analyze CAISO power supply data 3 5.0 1.0 2.0 2.0 141 705 Evaluate EV rate methodologies 4 6.0 2.0 2.0 2.0 158 950 Evaluate EV charging methodologies 5 6.0 2.0 2.0 2.0 158 950 Comparison of EV vs.combustion 6 6.0 1.0 2.0 3.0 134 805 Research of local incentives for charging units 6 4.0 1.0 2.0 1.0 151 605 EV Metering options 7 7.0 2.0 2.0 3.0 150 1,050 Analyze effect of demand requirements 8 3.0 1.0 2.0 - 168 505 Community charging stations and local busines 9 3.0 1.0 2.0 - 168 505 Research of local incentives for charging units 9 3.0 2.0 1.0 - 207 620 Study Reports 8.0 2.0 2.0 4.0 144 1,150 I Totals 75 19 27 , 29 $. 2,253 $ 11,065 Less APPA membership Discount 10% $ (1,107) Total Out of Pocket Expenses: $ - Total Not to Exceed $ 9,959 The above amounts include completion of all items listed in scope of services and proposal. We are available for additionalservices at our standard rates listed below: President/Project Manager $ 245.00 Vice President/Rates Manager $ 215.00 Analyst/Staff/Clerical $95.00-$132.00 Travel time is billed at 50%of hourly rate Phone Page 21 UFS Proposal to AL&W (616)393-9722 www.ufsweb.com 061. 2 F. U AZSA r.ur .a warry SCHEDULED ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF TH •Vi SA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: SCOPE OF WORK FOR INSTALLATION AND MAINTENANCE OF ELECTRIC VEHICLE (EV) PUBLIC CHARGING STATIONS RECOMMENDATION It is recommended that the Utility Board approve the proposed scope of work to solicit proposals for the installati9n and maintenance of EV public charging stations in Azusa. BACKGROUND In early 2011, electric vehicle manufacturers started to market and roll out Pure Electric Vehicles . (PEV) in major cities or regions nationwide. These new vehicles, as well as existing Hybrid Electric Vehicles (HEV), come equipped with electric motors and rechargeable batteries. Electric vehicles have a travel range before the batteries need to be recharged, similar to conventional combustion engine vehicles. Charging plugs have been standardized by the vehicle manufacturers, so that drivers or owners can charge their vehicles at home or other locations where electric vehicle chargers may be available. Publicly accessible electric vehicle (EV) charging stations are being constructed in many areas to support the use of PEVs and HEVs because of the need to charge these vehicles at locations outside the home when the charged batteries are used up or have reached their maximum range. By installing publicly accessible charging stations, an outlet is also created for the consumption of electricity, which can then lead to additional electricity sales revenue for the local electric utility. 062 Electric Vehicle Public Charging Station June 27, 2011 Page 2 of 2 A typical electric vehicle charging station consists of the following components: a) Parking spaces (either public or leased private) to park the PEV while charging b) Electric vehicle charging device c) Electric service to serve the electric vehicle being charged, including utility metering d) Integrated wireless or hard-wired communication equipment for monitoring usage e) Automated Point-of-Sale (POS) system to account & bill for electricity consumption at time of use commercial rates Staff proposes to create a framework for the installation of at least five publicly accessible charging stations at general locations within City of Azusa that could serve as a vehicle recharging demonstration project. This demonstration project will enable the Department to further evaluate the feasibility, economics and overall value proposition for owning/leasing, operating and maintaining electric vehicle public charging stations. There will be an initial capital cost for installing the electric vehicle charging stations. Staff will be seeking competitive proposals that incorporate an overall business plan for a "turn key" arrangement to install and operate EV charging stations. Five general locations for installing the electric vehicle charging stations are listed below. The selection of the actual locations will be subject to availability of existing nearby power lines, sources of communication facilities, vehicle traffic count, and leasing arrangements for private spaces. 1) Public parking structure or spaces 2) Shopping center or major commercial business 3) Educational institutions 4) Existing gas stations 5) Civic Center or government facilities In view of the above, staff recommends approval of the general scope of work for soliciting proposals on electric vehicle charging stations and authorize staff to issue the RFP to solicit proposals. FISCAL IMPACT Staff intends to bring back to the Azusa Utility Board at a later date, the results of the RFP solicitation and may recommend selection of a proposal at that time. Prepared by: F. Langit Jr. —Assistant Director, Electric Operations 063 DRAFT GENERAL SCOPE OF WORK FOR SITING, CONSTRUCTING AND OPERATING PUBLICLY ACCESSIBLE ELECTRIC VEHICLE CHARGING STATION June 27, 2011 1) Prepare, describe, and present the functions and features of a publicly accessible outdoor/indoor rated electric vehicle charging station, including: a) Electric charging mechanism and safety features b) Integrated communication features for remote monitoring c) Electrical specifications and type of input electric service required d) Automated, secured non-proprietary card system for billing usage e) Tabulated summary of comparable features with at least two other vendors 2) Identify at least five locations where electric vehicle charging stations can be sited, constructed and operated to serve the public. Include the following types of locations: Public Parking structure or spaces; shopping center or major commercial center; educational institutions; existing gas stations; and civic center or government facilities. 3) Prepare, describe and present the method and means of permitting, erecting, placing or mounting the electric vehicle charging stations at the five identified locations, including consideration of any special requirements for safe installation and/or protection from vandalism. 4) Prepare and submit a business plan to construct, operate and maintain at least five EV charging stations in identified locations. Business plan may present different owner-operator or lease options, but should comprise a "turn key" and viable proposal to include the construction, operation and maintenance of all charging stations for at least years. The plan should describe what equipment will be used, how all equipment will be furnished, installed and operated, and include the following: a) Conceptual plan/layout for the installing the electric vehicle charging station b) Proposed method of service for the electricity and communication system c) Third party arrangement for automated billing on usage and consumption d) Proposed leasing arrangement for either the charging equipment or space 5) Prepare, describe and present any grant, third party funding or government assistance associated with the offering and installation of electric vehicle charging stations. Azusa Light & Water is willing to work with charging station proponent(s) to install necessary electric supply and metering equipment. 064 Proponent should specify what assistance and equipment it expects Azusa Light &Water to provide to make the stations safe and economically viable. 6) Prepare, describe and submit an arrangement for the monitoring of the electric vehicle charging stations,including maintenance or warranty repairs to avoid any equipment failures and malfunction. Monitoring shall also be performed in regard to the usage of stations in different locations, to determine which locations or promotional programs are the most effective or economically viable. 7) Prepare,describe and submit the company's experience and capability to fully furnish and install electric vehicle charging stations including references from current clients or list of completed projects in the US. 065 _r* io AZUS.A. SIGHT a WATIt SCHEDULED ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF TH • iV USA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIE lePIP DATE: JUNE 27, 2011 SUBJECT: ADOPTION OF EXTENDED PRODUCER RESPONSIBILITY (EPR) RESOLUTION RECOMMENDATION It is recommended that the Utility Board: 1) Approve a resolution supporting Extended Producer Responsibility (EPR) as presented, and 2) Authorize the City Manager or his designee to sign the California Product Stewardship Council (CPSC) Pledge of Support and pursue CPSC membership. BACKGROUND The United States Environmental Protection Agency, (EPA) 2009 data estimates that approximately 71 % of today's waste stream comes from manufactured products and associated packaging; from common household items to household hazardous waste products like electronics, cell phones, fluorescent lights, batteries, paint and pesticides. In response to concerns about the disposal of such products, California has enacted landfill bans. In 2006, "universal wastes" were banned from landfill followed by sharps wastes in 2008. Under today's waste management system, the local governments become financially responsible for managing the disposal of these private goods, many of which are toxic and disposable by design. Ratepayers and taxpayers are financing costly government designed and operated collection programs which could be more cost-effectively managed in the private sector. According to CalRecycle, the cost of collecting, recycling, and disposing of hazardous products easily exceeds $500 million a year in California. The Los Angeles County alone spends almost $10 million a year implementing its household hazardous waste and electronic waste collection events; one of which is held in the City of Azusa in April. The City implements its own sharps mail back collection program. Funding for the sharps program comes from AB 939 fee incorporated in trash service fees paid by ratepayers. 066 Extended Producer Responsibility June 27, 2011 Page 2 Extended Producer Responsibility (EPR), otherwise known as Product Stewardship, means whoever designs, produces, sells or uses a product takes responsibility for minimizing its environmental impact through all stages of the product's life cycle. The producer, having the greatest ability to minimize impacts,has the greatest responsibility. This shifts the product management from one focused on government funded and ratepayer financed waste diversion to the producer or brand owner, who makes design and marketing decisions, in order to reduce public costs and drive improvements in product design that promote environmental sustainability. Today, products are regulated one at a time. All manufactured products should be managed by producers or their agents. When government makes Product Stewardship mandatory, it levels the playing field for businesses so they can compete in a fair marketplace. Highlights of EPR program: • "User Pays" System - ensure that cost of recovery at the end of life (EOL) of the product is reflected in the cost of the product, as opposed to externalizing the costs onto a network of taxpayers and ratepayers. • Better Product Design - When producers are responsible for the EOL management of the products they create, there is a financial incentive to design products that are durable, recyclable, less toxic, repairable, and reusable as opposed to disposable. • Reduced environmental impact of a product due to better design. • Stewardship Plan — responsibility on producers for developing funding, and implementing collections of their own product at the end of its life. • Producers can not sell in California if they are not in plan. The California Product Stewardship Council (CPSC) is an organization of California local governments to speak with one voice in promoting transparent and fair EPR systems in California. The Department of California Resources, Recycling, and Recovery (CalRecycle) adopted an EPR policy framework in January 2008 as the basis for future legislation. In December 2009, the San Gabriel Valley Council of Governments (SGVCOG) began implementing a household hazardous waste grant awarded by CalRecycle. The program is intended to build knowledge and capacity among San Gabriel local governments, retailers, producers, and other stakeholders to begin the transition from government managed and financed end-of-life (EOL) systems to producer-managed and financed EOL for products banned from landfills. 061 Extended Producer Responsibility June 27, 2011 Page 3 The SGVCOG is working closely with CPSC to implement this grant over the next two and a half years. Local governments are encouraged to support by adopting resolutions and purchasing policies in support of EPR. To date, more than one hundred jurisdictions have adopted EPR resolutions including the Los Angeles County, City of Los Angeles, Covina, Claremont, Monrovia, Pasadena, La Puente, San Dimas, and La Verne. FISCAL IMPACT There is no fiscal impact resulting from the adoption of the resolution supporting EPR; however the City of Azusa stand to gain fiscal relief in the future if the EPR policy is passed on a statewide level. Annual membership dues for the CPSC are $1000 which is budgeted in the AB 939 fund. Prepared by: Cary Kalscheuer, Assistant to the Director of Utilities Liza Cawte, Sr. Administrative Technician Attachments: EPR Resolution, CPSC Pledge of Support form, EPR Policy Framework 068 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, SUPPORTING AN EXTENDED PRODUCER RESPONSIBILITY (EPR) SYSTEM AND PLEDGING SUPPORT TO THE CALIFORNIA PRODUCT STEWARDSHIP COUNCIL (CPSC) WHEREAS, approximately 41,000 tons of discarded materials and products are currently sent to disposal from our community on an annual basis at a cost of$ 38.26 per ton; and WHEREAS, on February 8, 2006 California's Universal Waste Rule (CCR, Title 22, Division 4.5, Chapter 23) became effective; and WHEREAS,the Universal Waste Rule bans landfill disposal of certain products that are deemed hazardous, including household batteries, fluorescent bulbs and tubes, thermostats and other items that contain mercury, as well as electronic devices such as video cassette recorders, microwave ovens, cellular phones, cordless phones, printers, and radios; and WHEREAS, state policies currently make local governments responsible for achieving waste diversion goals and enforcing product disposal bans, both of which are unfunded mandates; and WHEREAS, Universal Waste and Household Hazardous Waste (HHW) management costs are currently paid by taxpayers and rate payers and are expected to increase substantially in the short term unless policy changes are made; and WHEREAS, local governments do not have the resources to adequately address the rising volume of discarded products; and WHEREAS, costs paid by local governments to manage products are in effect subsidies to the producers of hazardous products and products designed for disposal; and WHEREAS, the Utility Board/City Council of the City of Azusa supports statewide efforts to have producers share in the responsibility for Universal Waste products and other product waste management costs; and WHEREAS, there are significant environmental and human health impacts associated with improper management of Universal Waste, sharps, and other products; and 069 WHEREAS, Extended Producer Responsibility (EPR) is a policy approach in which producers assume financial responsibility for management of waste products and which has been shown to be effective; and WHEREAS, when products are reused or recycled responsibly, and when health and environmental costs are included in the purchase price, there is an incentive to design products that are more durable, easier to repair and recycle, and less toxic; and WHEREAS, EPR framework legislation establishes transparent and fair principles and procedures for applying EPR to categories of products for which improved design and management infrastructure is in the public interest; and WHEREAS, the California Product Stewardship Council (CPSC) is an organization of California local governments working to speak with one voice in promoting transparent and fair EPR systems in California; and WHEREAS, the City of Azusa wishes to incorporate EPR policies into the City's product procurement practices to reduce costs, impacts on public health and the environment, and provide positive economic incentive to support product take-back; and WHEREAS, in January 2008 the California Integrated Waste Management Board, now known as CalRecycle, adopted a Framework for an EPR System in California; and WHEREAS,the California State Association of Counties, the California League of Cities, the National Association of Counties, the National League of Cities and the US Conference of Mayors have all adopted resolutions or policies in support of EPR; NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF AZUSA that by adoption of this resolution, the City of Azusa urges CalRecycle to continue taking timely action to implement the Framework for an EPR System in California to manage problematic products, and to urge the Department of Toxic Substances Control to implement the Green Chemistry initiative to manage Universal and other toxic products; and BE IT FURTHER RESOLVED, that the City Council of the City of Azusa urges the California Legislature to enact product specific and framework EPR legislation which will give producers the incentive to design products to make them less toxic and easier to reuse and recycle; and BE IT FURTHER RESOLVED,that the City Manager and/or his designee be authorized to send letters to the California League of Cities, CalRecycle, and the State legislature and to use other advocacy methods to urge support for EPR Framework legislation and related regulations when deemed appropriate; and BE IT FURTHER RESOLVED, that the City Manager and/or his designee be authorized to sign the California Product Steward Council (CPSC) and participate by contributing $1000 to CPSC to educate and advocate for EPR policies and programs; and Revised 2/17/11 2 070 BE IT FURTHER RESOLVED,that the City of Azusa encourages all manufacturers to share in the responsibility for eliminating waste by designing products for durability, reusability and the ability to be recycled; using recycled materials in the manufacture of new products; providing proper labeling to tell the consumers about proper end of life management and hazards, and providing financial support for collection, processing, recycling, or disposal of used materials; and communicating with haulers and local governments about end of life management; and BE IT FURTHER RESOLVED,that by the adoption of this resolution, the City of Azusa urges the California legislature and agencies to continue taking timely actions to implement the framework for an EPR. ATTEST: Vera Mendoza, City Clerk STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Utility Board/City Council of the City of Azusa at a regular meeting of the Azusa Light & Water Utility Board on the 27th day of June, 2011. AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: Vera Mendoza, City Clerk 071 Revised 2/17/11 3 44/ 66ct Stesk, 4 PRO°+6 n for 1. ` California Product Stewardship Council.. y� �p J2 .r0SHIP G SC oil rTP British Columbia VERMONT PRODUCT Product SlewpdsNipCouncic \ STEWARDSHIP COUNCIL Framework Principles for Product Stewardship Policy The following principles are intended to guide development of product stewardship policies and legislation that governs multiple products. It is primarily aimed at state legislation but is also intended as a guide for local and federal policy. 1. Producer Responsibility 1.1 All producers selling a covered product into the State are responsible for designing managing, and financing a stewardship program that addresses the lifecycle impacts of their products including end-of-life management. 1.2 Producers have flexibility to meet these responsibilities by offering their own plan or participating in a plan with others. 1.3 In addressing end-of-life management, all stewardship programs must finance the collection, transportation, and responsible reuse, recycling or disposition of covered products. Stewardship programs must: • Cover the costs of new, historic and orphan covered products. • Provide convenient collection for consumers throughout the State. 1.4 Costs for product waste management are shifted from taxpayers and ratepayers to producers and users. 1.5 Programs are operated by producers with minimum government involvement. 2. Shared Responsibilities 2.1 Retailers only sell covered products from producers who are in compliance with stewardship requirements. 2.2 State and local governments work with producers and retailers on educating the public about the stewardship programs. 2.3 Consumers are responsible for using return systems set up by producers or their agents. Page 1 of 2 072 3. Governance 3.1 Government sets goals and performance standards following consultation with stakeholders. All programs within a product category are accountable to the same goals and performance standards. 3.2 Government allows producers the flexibility to determine the most cost- effective means of achieving the goals and performance standards. 3.3 Government is responsible for ensuring a level playing field by enforcing requirements that all producers in a product category participate in a stewardship program as a condition for selling their product in the jurisdiction. 3.4 Product categories required to have stewardship programs are selected using the process and priorities set out in framework legislation. 3.5 Government is responsible for ensuring transparency and accountability of stewardship programs. Producers are accountable to both government and consumers for disclosing environmental outcomes. 4. Financing 4.1 Producers finance their stewardship programs as a general cost of doing , business, through cost internalization or by recovering costs through arrangements with their distributors and retailers. End of life fees are not allowed. 5. Environmental Protection 5.1 Framework legislation should address environmental product design, including source reduction, recyclability and reducing toxicity of covered products. 5.2 Framework legislation requires that stewardship programs ensure that all products covered by the stewardship program are managed in an environmentally sound manner. 5.3 Stewardship programs must be consistent with other State sustainability legislation, including those that address greenhouse gas reduction and the waste management hierarchy. 5.4 Stewardship programs include reporting on the final disposition, (i.e., reuse, recycling, disposal) of products handled by the stewardship program, including any products or materials exported for processing. Northwest Product Stewardship Council www.productstewardship.net Adopted May19, 2008 California Product Stewardship Council www.calpsc.orq Adopted June 4, 2008 Vermont Product Stewardship Council www.vtpsc.orq Adopted November 6, 2008 British Columbia Product Stewardship Council www.bcproductstewardship.org Adopted Dec. 9, 2008 Texas Product Stewardship Council www.txpsc.orq Adopted January 30, 2009 NYS Assoc. for Solid Waste Management www.newyorkwaste.orq Adopted March 11, 2009 Developed with support from Product Policy Institute www.productpolicy.orq Page 2 of 2 073 C fs/ fq�fSacrt�mentn CA 9Sx?tl _� 1a z�rs California Product 916-480-9010 Stewardship Council wvvw.CatPSC.org PLEDGE OF SUPPORT The California Product Stewardship Council (CPSC) is a coalition of local government, their associations and organizations related to solid waste, recycling, resource conservation, environmental protection, water quality, and other cross-media issues (Associates). Together with non-government organizations (NGOs) individuals, and businesses (Partners) across California they form a network supporting product stewardship and extended producer responsibility (EPR). CPSC is a federally recognized 501(c)(3) non-profit public benefit California corporation that exists by means of your monetary and in-kind contributions in addition to private and public grant funding. CPSC MISSION: To shift California's product waste management system from one focused on government funded and ratepayer financed waste diversion to one that relies on producer responsibility in order to reduce public costs and drive improvements in product design that promote environmental sustainability. CPSC FUNCTIONS: 1. Build relationships among local government and other stakeholders to increase capacity and knowledge in order to bring about producer financed and managed systems for life cycle and end of life management of their products. 2. Develop practical local and statewide EPR policy and educational tools such as model ordinances, legislation, newsletters, articles, policy briefings,PowerPoint presentations, etc. The undersigned supports the mission and functions of the California Product Stewardship Council, has reviewed, understands and endorses the Framework Principles for Product Stewardship Policy, and will advocate in support of product stewardship and EPR. Affiliation (check one): ❑ Associate- Local Government(City,County,Local Government Association) ❑ Partner- Individual,Business,NGO,Other Organization Signature Date Name (print) Title Organization/Jurisdiction (city,county,regional agency) Department/Agency Mailing Address (street address or P.O.Box,City,State,zip) Telephone (with area code) Email ❑ Check here if you are including or will provide a financial contribution to CPSC Please sign, include contribution, and mail to CPSC,P.O. Box 216381, Sacramento, CA 95821 Mission:•io~hitt(aliturnia's product waste tnanattement system from one tbelised on government funded and ratep tser financed waste diversion to one that relies on producer responsibility'in order to reduce (�M'� /O. public costs and drive improvements in product design that promote environmental sustainability. ,,r r `! • ALLISA .ChT 6 'w'4r E. INFORMATION ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE SA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: REPORT ON "DIRECT BURIED" SECONDARY ELECTRIC CABLES AT THE HUNSAKER TRACT The Hunsaker Tract is a residential subdivision bounded by the Azusa Green golf course on the north, Sierra Madre Avenue on the south, Deborah on the west, and Virginia Ann on the east. Hunsaker Tract was developed by S. V Hunsaker and Sons Inc. sometime in the 1960's. This subdivision consists of 129 single family detached homes. The original electric distribution system was constructed using direct buried cables. Over the years, this direct buried cable system has deteriorated and was susceptible to failure without warning. In 1990, the Electric Division hired a contractor to install v`1ts and conduits to replace the "primary" direct buried 12 kV cables. However, the "secondary" portion and service laterals of the system were not replaced. There have been power outages to a number of homes on different occasions due to failure of the direct buried secondary cables. When the underground cable failed, new conduit/cables were installed in order to restore power to affected homes. Among these 129 services in the subdivision, only 5 have been replaced with cables in conduits to date. The remaining 124 homes still have direct buried cable services. To replace the remaining electric services to homes and street lights in this tract with new conduit/cable, staff estimates that it will cost at least one million dollars. Comprehensive reconstruction work for the conduit system would take approximately six months to complete. 075 Direct Buried Secondary Cable at Hunsaker Tract June 27, 2011 Page 2 Besides the Hunsaker Tract, Tract # 23528 is another tract in the City which has direct buried service laterals. Tract # 23528 is bounded by Sierra Madre to the north, 13`h Street to the south, Azusa Avenue to the west, and Alameda Avenue to the east. Tract # 23528 electric system consists of overhead primary 12kV power lines, pole mount transformers, and direct buried cables for secondary and service laterals. There are 13 detached homes in this tract. Electric services of 12 homes are still being served by direct buried cables. Electric service to one home was converted to overhead service wire when its direct buried service cable failed at some point in the past. Presently, there are no firm plans to install conduit and cable system for either the Hunsaker tract or tract# 23528. Prepared by: Hien K. Vuong, Electrical Engineer Reviewed by: Federico Langit Jr., Assistant Director- Electric Operation Dan Kjar, Electric Operation Supervisor 076 Gr..... 4 :, 2,' ,r4 'Y ") .4„,,:,, AZUSA LIGHT 6 WATER INFORMATION ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: UPDATE ON THE CALIFORNIA RENEWABLE PORTFOLIO STANDARDS (RPS) BILL On April 12, 2011, California Governor Jerry Brown signed into law California Senate Bill SBX1-2, the RPS Bill. In addition to increasing the RPS to 33% by 2020, SBX1-2 also makes a number of other significant changes to California's RPS. For the first time, the RPS is extended to publicly owned utilities ("POUs") in California. Under the pre-existing 20% RPS (SB 1078), municipal utilities were required to develop a standard but were free to choose the amount of renewable energy they would procure under that standard. For POUs, implementation of the 33% RPS would be left to their governing boards, while the California Energy Commission, which is tasked under the legislation with developing an enforcement mechanism for the POUs, would refer any violations to the California Air Resources Board for penalties. SBX1-2 requires all California's electric utilities to reach the 33% RPS in three compliance periods. Between January 1, 2011 and December 31, 2013, the utilities must procure renewable energy products equal to 20% of retail sales. By December 31, 2016, utilities must procure renewable energy products equal to 25% of retail sales, and by December 31, 2020, utilities must procure renewable energy products equal to 33% of retail sales and maintain that percentage in following years. It should be noted there are still a number of inconsistencies between various sections of SBX1-2 and recent rulings of the California Public Utilities Commission (CPUC). Additional clarifications of several provisions of the bill may be required. One such important clarification would help establish whether energy derived from Azusa's share of Hoover could be deemed a renewable resource. Accordingly, there are already discussions about a potential "cleanup" bill and/or CEC regulation writing during which various cleanups and clarifications could be made. 077 Update on California RPS Bill June 27, 2011 Page 2 As soon as the RPS Bill is "cleaned" and final regulations are written, staff shall report to the Board how the RPS law affects Azusa's electric utility, and what action must be taken by Azusa to comply with the new State RPS law. Azusa Current Renewable Projects Azusa's current renewable portfolio consists of 4 contracts, from 10 to 20 years in length, with about 17.7 MW of contracted capacity in total. • Iberdrola(formerly PPM wind)PPA—wind; 6 MW capacity; in-state PPM Energy was Azusa's fist renewable energy contract. The 20 year purchase power agreement (PPA) was negotiated through SCPPA and executed in 2003 as a bilateral PPA. The contract capacity is based off a large wind farm in Solano County, CA. The associated energy is delivered shaped at the rate of 2 MW per hour at the Mead 230kV substation. Other entities that have entered into similar PPAs with PPM Energy are Pasadena, Anaheim, Colton, and Glendale. • San Dimas bilateral PPA—small hydro; 1.05 MW; in-state The 10 year agreement with the San Gabriel Valley Municipal Water District (SGV MWD) was executed in 2006. It should be noted that Azusa (Water) is one of the four member agencies of SGV MWD. Contract capacity is derived from a small hydroelectric generator located in San Dimas at the San Dimas turnout of the Devil Canyon — Azusa pipeline. • Garnet bilateral PPA—wind, 6.5 MW capacity(currently 5.5 MW); in-state The 20 year Garnet PPA was executed in 2007. The contract calls for energy from 13 (0.5 MW nameplate capacity) wind turbines for the total of 6.5 MW. The wind park is located in San Gorgonio Pass near the City of Palm Springs, CA. • MWD SCPPA PPA— small hydro; 3.71 capacity MW; in-state The 15 year PPA between the Metropolitan Water District (MWD) and SCPPA was executed in 2008; other participants on the project include Anaheim and Colton. The agreement is based on four(4) small water conduit based hydroelectric plants. • La Paz PPA - solar tower (new technology); 2 MW; Arizona The 20 year PPA with SCPPA was adopted by Azusa ordinance in early 2011. The project is located in western Arizona in the Western Administration Power Area Balancing Authority. Contractor projected Commercial Operation Date (COD) — 2014; the energy will be delivered at LADWP's Marketplace 500 kV substation. 078 Update on California RPS Bill June 27, 2011 Page 3 Azusa current RPS Level Azusa's RPS in 2010 reached approximately 19.3% and this calculation includes Azusa's Hoover energy share(1.7%). Azusa's Currently Ongoing RPS procurement activities 1. RAM Power PPA (through SCPPA) — geothermal project; potential Azusa subscription — 1 MW; located in-state (Imperial County), in IID Balancing Area (control area); currently projected (but not yet finalized); contractor projected Commercial Operation Date (COD) — 2014; contractor proposed length of contract - 30 years. 2. Bowerman PPA (through SCPPA) — landfill gas; potential Azusa subscription 1 or 2 MW; in-state (Orange county); ISO control area; currently projected (but not yet finalized); contractor projected COD — 2013; contractor proposed length of contract - 20 years. 3. SGMWD Small Hydroelectric— we are exploring the addition of up to four small hydro units (similar to the current San Dimas hydro unit) in SGMWD pipeline which could generate up to 2 MW. 4. Recent SCPPA RFP. Azusa also stated its interest in the following three projects selected from some over 200 responses to SCPPA's recent RFP for renewable resources. a. Martifier/Silverado—Photo Voltaic; 7 MW interest; project located near the City of Lancaster, CA b. UAMPS—wind; 3 MW interest; project located in Idaho c. Brown-to-Green—Photo Voltaic; 1 MW interest; project located near the City of Laughlin, NV Prepared by: Yarek Lehr, Assistant Director of Resource Management 079 I AZUSA h 11 LIGHT d NATER INFORMATION ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: POWER COST ADJUSTMENT EFFECTIVE JULY 1, 2011 On June 28, 2010, the Utility Board adopted Resolution No. 10-C39 approving the Power Cost Adjustment (PCA) Rule which aims to recover purchased power costs that exceed approved base rates, or provide a credit to customers for cost savings realized when purchased power costs fall below approved base rates. The PCA is calculated semi-annually and administratively implemented July 1 and January 1 of each fiscal year. The PCA is based on a 12 month budget for purchased power costs, and is adjusted every six months for actual costs that deviate with the 12 month budget. The current PCA thru June 30, 2011 is $0.00958 per kWh. Based on the FY 2011-12 budget plus actual costs from November 1, 2010 thru April 30, 2011, the PCA effective July 1, 2011, has been determined to be $0.02059 per kWh. The factors which were considered in calculating the PCA effective July 1, 2011 include the following: FY 2011-12 Purchased Power Budget $22,871,489 Expected Sales (MWH) 238,875 Cost per MWH $95.75 Base Rate Cost Recovery per MWH $81.64 Budget Based PCA per MWH $14.11 Unrecovered Cost from Prior 6 Months per MWH $4.61 _ Total PCA without City Fees per MWH $18.72 PCA with City Fees of 10% per MWH $20.59 080 June 27, 2011 Power Cost Adjustment Page 2 The largest portion of the new PCA (about 68%) is based on the Purchased Power cost budget for FY 2011-12. The budget increased on a per MWH basis due in part to a 2.75% reduction in the sales forecast for next fiscal year. The next largest component of the PCA (about 22%) is made up of undercollections of revenues from effective PCA to recover actual costs from November 1, 2010, through April 30, 2011. Undercollections resulted from unforeseen purchased power costs that resulted from outages of the San Juan Resource. During the November outage, replacement power had to be purchased and these costs were not part of the FY 2010-11 budget or PCA in effect during the prior period. Franchise fees and In-lieu fees make up 10% of the adjusted PCA. The revised PCA effective July 1, 2011, is expected to increase revenue by about $1.4 million over the next 6 months. $589,000 of this amount will discontinue after 6 months when the new PCA is calculated effective January 1, 2012. Because of the magnitude of this PCA adjustment, a more detailed report was written and is attached for your reference. Prepared by Cary Kalscheuer, Assistant to the Director of Utilities 081 POWER COST ADJUSTMENT SEMI-ANNUAL ADJUSTMENT JUNE 27,2011 AZUSA LIGHT&WATER 729 N.Azusa Ave. Azusa,CA 91702 Prepared by Cary Kalscheuer Assistant to the Director of Utilities 082 INTRODUCTION This report presents the background and basis for setting the Power Cost Adjustment (PCA) for Azusa Light & Water electric utility customers effective July 1. Adjustments to the PCA are to be calculated semi-annually and go into effect July 1 and January 1 of each year. The current PCA is $0.00958 per kWh and this report proposes an increase in the PCA to $0.02059 per kWh. Because of the magnitude of this adjustment, this report provides some detail as to how the adjustment is calculated and includes some supporting documents as attachments. The PCA is administratively approved by the Director of Utilities and implemented through the customer billing system. BACKGROUND On June 28, 2010, the Azusa Utility Board adopted Resolution No. 10-C39, approving the Power Cost Adjustment (PCA) Rule, i.e., Schedule PCA. The PCA aims to recover purchased power costs, or credit customers for cost savings that result from purchased power cost fluctuations, where such fluctuations either exceed or fall below approved retail base rates set to recover costs for purchased power. The PCA is calculated based on the approved budget for upcoming fiscal year. The following table, for example, sets forth the budgeted line items considered by the PCA that went into effect July 1, 2010: FY 2010-11 Power Resource Budget Wholesale Revenues (6,364,026) Purchased Power Cost 25,264,118 Net Purchased Power Cost 18,900,092 Transmission Cost 2,650,824 Dispatch and Scheduling 656,168 Total 22,207,084 Next, the budget amount is divided by the anticipated megawatt hours (MWH) of sales forecasted in the upcoming fiscal year. For FY 2010-11, 245,631 MWH of sales were anticipated, which equates to a forecasted cost of purchased power of $90.41 per MWH. The forecasted cost of purchased power per MWH represents total anticipated cost to be recovered through retail base rates and the PCA. The retail base rate for purchased power was determined to be $74.69 per MWH in a report prepared by the Power Resources Division in October 2007, The only base rate adjustment since that time was on December 1, 2009, which was 9.3%, This increased the retail base rate to $81.64 per MWH for purchased power costs. The above information led to the initial PCA effective July 1, 2010 being set to $8.77 per MWH, or $9,60 per MWH with City Fees based on the following: Forecasted Purchased Power Costs $ 90.41 Approved Base Rates - 81.64 PCA $ 8.77 With 10% Franchise and In-Lieu Fees $ 9.60 Based on above, a PCA of $0,0096 per kWh was applied to all customer consumption from July 1, 2010, thru December 2011. Page 2 of 5 0 8.3 Since the PCA rule calls for actual costs to be monitored and compared to budgeted costs when semi annual adjustments are made to the PCA, actual costs for purchased power are tracked for six months, and then compared to the budget based PCA. This difference is then either credited back to customers or added to the PCA for the subsequent six month period. Actual costs were tracked from July 1, 2010 through October 31, 2010 for the first semi-annual PCA adjustment, effective January 1, 2011. During this period, Actual costs were $90.34 per MWH compared to budgeted cost of $90.41 per MWH. This resulted in a slight lowering of the PCA to $0.00958 per kWh ($0.00871 per kWh excluding City fees)effective January 1, 2011 thru June 30,2011. JULY 1, 2011 PCA ADJUSTMENT The PCA Adjustment effective July 1, 2011, considers (1) the approved power resources budget for FY 2011-12, and (2) the actual costs for power during the period of November 1, 2010 through April 30, 2011. 1. FY 2011-12 Budget The power resources budget for FY 2011-12 serves as the basis for the budget portion of the PCA effective July 1, 2011, and the following line items are specified by the PCA Rule: FY 2011-12 Power Resource Budget Wholesale Revenues (6,664,393) Purchased Power Cost 26,030,712 Net Purchased Power Cost 19,366,319 Transmission Cost 2,866,030 Dispatch and Scheduling 639,140 Total 22,871,489 Since the sales forecast for upcoming fiscal year is 238,875 MWH (2.75% lower than the prior fiscal year) the anticipated cost per MWH is$95.75. Hence,the budget based portion of PCA for FY 2011-12 is to be set as follows: Forecasted Purchased Power Costs(budget) $ 95.75 Approved Base Rates - 81.64 Budget based portion of PCA $ 14.11 With 10% Franchise and In-Lieu Fees $ 15.52 Above converts to$0.01552 per kWh for budget based portion of PCA for FY 2011-12. 2. True-Up Portion of PCA As noted previously, the budgeted cost for power resources for FY 2010-11 was $90.41 per MWH. However, actual costs for power resources were $95.59 per MWH for the period of November 1, 2010, through April 30, 2011. Much of the increase was due to unscheduled outages at the San Juan Resource in November, when the Electric utility was forced to buy replacement power. Page 3 of 5 084 Supporting documentation is attached and summarized below: ACTUAL POWER RESOURCES COSTS Description Nov'10 Dec'10 Jan'11_ Feb'11 Mar'11 Apr'11 , 6 Mo Totals Wholesale Revenues (523,438) (566,596)_ 1502,218) (445,815) (455,177) (385,187) (2,878,431) Purchased Power 2,599,385 1,692,581 1,767,467 1,893,463 1,935,997 1,878,047 11,766,940 Transmission 371,500 209,319 198,542 232,142 271,407 205,742 1,488,652 Scheduling and Dispatch 53,578 51,734 43,545 40,950 44,788 , 51,965 286,560 Total $2,501,025 $1,387,038 $1,507,336 _ $1,720,740_ $1,797,015 $1,750,567 $10,663,721 Sales in MWH 17,194 19,450 19,538 17,706 _ 17,534 20,134 111,556 Cost per MWH 145.46 71.31 77.15 97.18 102.49 86.94 95.59 Source: Power Resources Division of Azusa Light&Water(See attachment) • Actual costs versus approved base rate and effective PCA show revenue deficiency of about $582,000 for respective period in retail rate structure as summarized below: MONTHLY UNDER-RECOVERY (Uses Average Cost Factors) Period Nov'10 Dec'10 Jan'11 Feb'11 , Mar'11 Apr'11 6 Mo Totals Actual Power Costs Per MWH 95.59 95.59 95.59 95 59 95 59 95 59 95,59 Cost Recovered thru Base Rate 81.64 81.64 , 81.64_ 81.64 81.64 81.64 81 64 Difference 13.95 13 95 13.95 13.95 13.95 13.95 , 13.95 Approved and Effective PCA 8.77 8.77 8.71 8.71 8.71 8.71 n/a Per MWH Excess/(Deficiency)in Rates -5.18 -5.18 -5 24 -5 24 -5 24 -5.24 n/a Total MWH for Period 17,194_ 19,450 19,538 17.706 17,534 20.134 111,556 Total Excess/(Deficiency)in Rates (89,072)_ (100,761) 1102,388) (92.788) (91,883L (105.513) (582,405) The above table shows that the Electric Utility under collected approximately $582,000 during the six month period from November 2010 thru April 2011 due to higher than projected purchase power costs. The under-recovery equates to $5.22 per MWH considering sales during this period of 111,556 MWH. Page 4 of 5 085 3.Combined Budget Based PCA,True Up and City Fees To pay for costs which exceeded the FY 2010-11 budget forecast from November 2010 through April 2011, the PCA rule requires that the recovery amount be apportioned to ratepayers in the subsequent six month period of the effective PCA, and be calculated based on anticipated sales during the upcoming period. This results in true up equating to $4.61 per MWH. This true up amount plus the budget based portion of the PCA for FY 2011-12 along with the City Fees of 10%are shown in next table. PCA-Includin• True Up, Budget Based PCA,and City Fees($/MW) Description July'11 Aug'11 Sept'11 Oct'11 Nov'11 Dec'11 6 Mo Totals Energy Sales Forecast(MWH) 20,574 22,304 23,679 23,164 17,194 19,450 126,365 True Up Amount-$/MWH 4.61 4.61 4.61 4.61 4.61 4.61 4.61 Total Forecasted Revenues 94 824 102,795 109.136 106,759 79.246 89,645 582,405 Budget Based PCA -$/MWH 14.11 14.11 14.11 14.11 14.11 14.11 14.11 Budget RCA+True Up-$/MWH 18 72 18.72 18.72 18 72 18 72 18 72 18 72 PCA Plus City Fees(10%) 20 59 20.59 20 59 20.59 20.59 20.59 20 59 Note in above that the revenue shortfall incurred in the prior period of$582,406 is set to be recovered from July 2011 through December 2011 based on anticipated sales. Adding the recovery amount ($4.61 per MWH)to the budget based portion of the PCA($14.11 per MWH) results in a new PCA of$18.72 per MWH for effective period of July 1, 2011 through December 31, 2011. Since City Franchise and In Lieu Fees equate to 10% of electric utility billing rates, 10% must be added to the PCA to make the Utility whole with respect to covering incurred purchased power costs. This is consistent with the PCA rule. Adding City fees to the PCA brings the total PCA to$0.02059 per kWh effective July 1,2011. FISCAL IMPACT Since the current PCA is $0.00958 per kWh, the new PCA is an increase of$0.01101 per kWh. The net increase over current PCA is about $1.4 million over the next 6 months. Without reviewing our purchased power costs as prescribed in this report and adjusting the PCA, the electric utility would not be recovering its full cost of doing business. Attachments: 1. Power Resources Division Memo of Actual Expenses for Nov 1, 2010 through April 30, 2011: Resale Revenues,Acct No.33-40-734-470-4811 Purchased Power, Acct No. 33-40-775-550-6590 Transmission Expenses, Acct No. 33-40-785-650-6493 Scheduling and Dispatch Expenses, Acct No. 33-40-785-560-6493 2. Customer Information System Billing Reports Nov 1, 2010 through April 30,2011 Page 5 of 5 086 AZUSA LIGHT &WATER MEMORANDUM TO: George F, Morrow, Director of Utilities FROM: Yarek Lehr, Assistant Director of Resource Management DATE: June 9, 2011 SUBJECT: Power Cost Adjustment Information Mr, Morrow, Attached herein please find the "actual"wholesale information for the Nov-2010 to April 201 1 period, as tracked and recorded by the Power Resources group. The herein provided information is based on our tracking of the processed and approved in- coming invoices and invoices we originate and Issue for the purpose of billing our counter parties. Information pulled from the Power Resources tracking spreadsheets as of June 9, 2011 2010 2010 2011 2011 2011 2011 Nov Dec Jan Feb Mar Apr Capacity& Energy 2,599,385 1,692,581 1,767,467 1,893,463 1,935,997 1,878,047 Wholesale Revenue (523,438) (566,596) (502,218) (445,815) (455177) (385,187) Transmission 371,500 209,3,9 198,542 232,142 271,407 205,742 Sched. & Dispatch 53,578 51734 43 545 40.950 44 788 51,965 _ Sincerely, / Yarek Lehr COPY: Cary Kalscheuer 087 AZUSA LIGHT AND WATER BILLING REPORT NOVEMBER 2010 November 2009 2010-2011 Fiscal Year To Date 2009-2010 Fiscal Year To Date November 2010 November2010 November 2009 N Customer Types Number of Consumption November 2010 Number of Consum tion November 2009 Consumption Bpay uniptbn Accounts Billed (Mv bird) Accounts Bitted flew tVc� (KwfVCCF) Baling (Kwf✓CC� Baling • • Small business(G-9 1.115 1.214,451 $194,534.38 1,116 1.290,5191 $188,394.41 7.799.269-• ' 8,540,152 51,216,843.99 Medium business G-2 5 ,183,145.53 ( ) 296 3,681,135 $521.381.77 297 4,042,356 5513.513.46 23.947,086 53,183,145.59 26,131,024 53119,566.35 Large business(T.O.U.) 37 6.821,955 5733.270.78 36 6.610,782 5658.321.80 35,622.694 $4,594.105 26 35,185,255 54.158.778.44 Street Lights 65 4,928 $1.157.40 65 5,136 51.058.08 24,640 $5.787.00 25,680 55.280.45 Outdoor Lights 43 5,581_ $1,202.70 43 5,581 $1,100.41 27.905 $6.01350 Municipal Accounts 129 659,256 572,044.33 13923,305 $5.509.22 905865 $91,174.14 4,687,436 551 d,985.Od 6,193,305 $513,889.22 Total Commercial 1,685 12,387.308 $1,523,678.36 1,696 12,860239 51,453,560.31 72.109.019 89,527,143.72 75,013,411 50 Residential 13,864 4,817,183 $618,123.95 13,868 5,241,792 $622.034.88 34,892,989 $4,875.782.03 39.228,892 $4,883,977732 Power Cost Adjustment $164,730.40 $0.00 $1.024.540.67 .00 Total Electric Adjustments 0 - $072 ._ 1 23 ($7,843.58) 1,137.337 $124 640.92 (87,708) ($13,157.71) 1,055.819 $114,682.72 Total Electric 15,549.-"•' 17,193,966 $2,304,889.13 15,554 10111,2311M3 $2,200,236.11 106,914,300 $15,214,288.71 115,298,122 513,998,51854 Mist Revenue Billing $109,030.22 $118,542.85 5579.205.62 :::...... ., _ 5532,241_71 4iiiie8#Giiiiiiiter. .. . Residential 7.285 114,770 $294,659.54 7,255 140,294 5291,373.20 890,776 62,032.883.34 917,148 $1,795,552.96 Commercial 921 58,706 5142,856.01 924 72,569 5145,680.46 505,546 51,068.570.28 465,207 Fire Detector Line 194 32 $26,907.89 197 99 $11 ,799.69 $23.145 43 181 $134,217 47 443 $175,765.69 Industrial 307 28,018 $47,622.96 311 39.554 $56,774.42 230,776 5387,382.04 226,808 Municipal Accounts 153 4,385 86,943.04 156 8,482 $10,53950 53.0865329,976.48 Gott Course/Miller Brewin $80,824.91 68,878 $87,476.80 9 2 53780 $92,:-.-- 6 2 80,923 $108,805,75 378,542 $609,845.04 504.701 $878,375.77 Total City Water 8,862 259,699 $611,434.50 8,845 942,921 5636,318.76 2,068,887 54,313,503.08 2,173,286 53,878,947.45 1 :Y4d14Y 046br.:: Residential 6.218182,421 544.4,210.82 6,239 198.088 $407,810.67 1.130,581 $2.618.133.15 1,1699,980 $2,327,494.29 Commercial 551 51,001 $98,868.45 551 64.809 $103,299.23 419,425 5769.624,46 436,705 5887.378.10 Fire Detector Line 94 8 $10,956.15 89 50 $8,941.55 20 $55,664.99 224 $47,341.78 Industrial 21 ?0,588 $39,771.91 19 24,045 $40,253.74 125,817 $242,549.71 125,270 $209,318.11 Total AV Water 6,884 254,016 $593,805.33 6,898 286,992, $560,305.19 1,675,843 $3,665,972.31 1,732,159 $3,271,532.28 RWCAF $0.00 $28.808.95 50.00 5178,897.73 CfTY/AV WATER TOTAL 15,746 513,715 $1,205,239.83 15,743 829,913 51,225,432.90 3,734,730 $7,999,475.39 3,905,444 $7,329,377.46 TOTAL ELECTRIC/WATER $3,619 159.18 $3,544,211.66 $23,792,969.72 821,860,137.71 Residential 12.469 5106,103.58 12.396 $101.846.95 , Commercial 1.581 $21,422.87 1,591 $22,114.82 5124.218.33 8119,391.45 Industrial $4,550.83 182 $330.12 $128.474.73 178 5119,391.45 Car Wash&Laundry 11 $$8,691.20 $$6,384.15 $309.69 11 55,265,97 $7,697.20 $6,884.15 Total Sewer Adjustments 5449.93 - Total Sewer 14 55,575.19 (536288) 5732,836.88 14,180 5129,557,86 $685,271.99 $659,931,93 .:.�1 ..,„;.:-.Iii- 12:x; S2@�vt92 M! 11: 15 $182 X8&.e E1'AGQ kis: t '«' tt4}1 GRAND TOTAL BILLING $4,047,158.47 $3,956557.85 $25,929,225.86 $23,917,112,81 Mnt.Assessments $10.862.51 I $10.896.11 553,985.49 $54.077.70 State Surcharge 53,771.92 $4,281.r _ 523,615.85 $25.512.09 C Tax • © Elec.User's Tax 131,744.30 M Water User's Tax 5124.839.40 $847.764.08 WEOM 629 493.54-_ $774.801.24 ' Total User's Tax 531 989.87 $208 004.02 $192 656.54 CO $161,237.84 5156,809-27 ___ $1,055,768.10 8967.457.78 AZUSA LIGHT AND WATER BILLING REPORT DECEMBER 2010 2010-2011 Fiscal Year To Date 2009-2010 Fiscal Year To Date December 2010. December 2010 December 2010 December 2009 December 2009 December 2009 Customer Types Number of Consumption Number of Consumption Consumption Consumption Accounts Blued (kern/cogBillingAccounts Billed (kw race) Biting Billing Biting (Kw hrCCF} (Kwh/CCF) Small business(G-1) 1 1,130 1.413.564, 5223,729.82 1.107 1,272,327 2203,183.17 9,212.823 $1,446.827.15 9,812.479 21,420,027.18 Medium bus,ness(G-2) 293 4.161,087; $560.123.73 296 3.887.306 $536,029.94 28.108.173 $3,743,289.32 30,018,330 831,655.596.29 Large business(T.O.U.) 37 6,792.809 $732.822.93 36 5.689.122 $708,710.90 42.415,563 $5,326,928.19 41,874.377 $4,867,487.34 Street Lights 65 4.928 21.157.40 65 5,135 $1,155.76 29,568 588,944.40 30.816 $6,435.21 Outdoor Lights 43 . 5,681 21,202.70 43 5,581 $1,202.70 33.488 27,216.20 33.486 26.704.75 Municipal Accounts 128 742,572 $80,741.50 133 7911376 $87,250.29 5.430007 5595,736.54 5,895,071 $601,139.51 Total Commercial 1,696 13,120.6011 21,599,778.08 1,680 12,651,148 21,537832.78 85.229,620 $11,125,921.80 87,664,559 $10.557,391.26 Residential 13.912 6,334.360' 2834,57659 13.840 5.345.772 2694.602.28 41,227.349 $5,510,438.62 44.574,664 25,558,579.80 Power Cost Adjustment 1 $186,255.75 $0.00 $1,210,797.42 0 $0.00 Total Electric Adjustments 74,7101 (5719.23) (8,521) ($1.098.25)_ 92418 ($13,876.94) ),047,298 $113.584.47 Total Electric 15,608 19,450,251 )$2,619,992.19 16,620 17,988,399 62,231,036.79 126,364,551 $17,834,280.90 133.286521 516,229,555.33 (c ,,...----rte Misc Revenue Billing $103,799.28 $107,184.99 $683,004.90 $639,426.70 iRiiii'sYIC{)y:iAtatex, • Residential 7,284 147,171 $350,359.42 7,300 148.437 5300,435.47 1.037,947_ 22,383,222.76 1.063,585 52,095,988.43 Commercial 920 67,892 8157.096.95 922 72.394 $143,885.56 573,438 $1,225,667.23 537,601 51,035,685.31 Fire Detector Line 194 25 $28,893.78 194 91 223,078.33 208 $161,111.25 534 5138,842.02 Industrial 308 33,875 855,516.74 308 46,818 $67,231.72 264.651 $442,898.78 272.428 2397,208.20 Municipal Accounts 151 5,179 $8,157.35 155 9,563 58.139.43 58,245 $88,782.26 68,541 575,616.23 Gott Course/Miller Brewing 2 50,333 586,875.53 2 68,558 592,703.30 428,875 5698.720.57 573,259 $771.079.07 Total City Water 8,839 304,475 2684,899.77 8,881_ 342,661_ $635,471.81_ 2,363,362 $4,998,402.857 2,515,946 $4,514,419.26 . Residential 6,282 149,602 $393.461.71 6,313 169,295 2387,195.18 1,280,183 $3,011,594.86 1,339,255 $2,694,689.47 ' Commercial 698 60,017 $118,578.80 697 64.859 $108,111.76 479.442 $888,203.28 501,584 $795,489.86 Fire Detector Line 101 62 $12,325.29 98 55 $10,275.90 82 $67,990.28_ 279 $57,517.68 Industrial 20 20,340 $39,33025 19 20,999 535,128.92 148,157 5281,879.96 146,289 5244,447.03 Total AV Water 7,099 230,021 $563,696.06 7,127` 255,208 $520,711.76 1,905,864 $4,249,668.36 1,987,367 $3,792,244.04 RWCAF $0.00 $27,460.25 _ $0.00__ $208,357.98 CITY/AV WATER TOTAL 15,938 534,496 51,248,596.82 16,008 597,869 $1,183,643.82 4,269,226 $9,248,071.21 4,503,313 $8,513,021.28 TOTAL ELECTRICIWATER $3,972,387.29 $3,521,865.60 $27,765,357.01 $25,382,003.31 • Residential 12.513 $105,745.54 12,435 _ $101,950.01 $632,058.04 $605,805.48 Commercial 1,597 222,284.04 1,575 $21,528.04 2148,502.37 $140,919.49 Industrial 184 64,817.32 177 $5,928.60 $33,292.09 $29.292.34 Car Wash&Laundry 11 5322.84 11 $338.42 $2.014.04 $7,022.57 Total Sewer Adjustments $375.53 $18120 $5.950.72 ($181.68) Total Sewer 14,305 2134545.27 14,198 _ $129,926.27 $819,817.26 _ $783,858.20 Illii401thiCtlittitikff:-. .j. i4;4701 I: . *206027:70d _ . L....' 03 /41' . 1 • tIA47.XtAAj 1. $4006.;42141 . ts�7" GRAND TOTAL BILUNG $4,403,460.26 53,935,176.11 S30.332,686.12 S27,852,288.92 Met.Assessments $10,906.47 $10,882.54 $64,871.96 $84,960.24 Slate Surcharge $4,331.89 $3.970.79 I $27,947.74 $29,482.88 ,City Tax Elec.User's Tax S145.988.64 $126,297.49 5993.752.72 $901,098.73 O Water User's Tax _ 4335.87 231,896.71 2240:T3..89_ $224,553.25 WTotal User's Tax $178,324.51 �___ 5158,194.20 51,234,092.61 $1,125,651.98 MAWR i Pill I 1g cr3 49,49 67, 49 11111 1111FbIIIiII I 111 111IiIIF 111 Ii ' iiriiiii II 1111 111111 111 11311 111111 WW1 IU OPP 111 : MIMI . 111 1111111 1 11111111 MEL MI MN 1111 111 11111101 II IN 111111 111111ff UI 11111111111 111 11111111111 di J73 Lt.' cn L3 'n 1111W1,78,0 ;Al (1 ;: LOW ; 11nr- 090 • AZUSA LIGHT AND WATER BILLING REPORT FEBRUARY 2011 February 2011 February 2011 February 2010 February 2010 2010-2011 Fiscal Year To Date 2009-2010 Fiscal Year To Date February 2011 February 2010 Coneumptton Consumption Customer Types Number of Consumption FAWN [Ming of Consumption BlNhg BNfng BNlkng Accounts Biked (kw Nod) Accounts Billed (kw 8/cct) (Kw h/CCF) (Kwh/CCF) Small business 0-1) 1,135 1,270,097 $202,88175 1.110 1,158,677 $186,746.10 11.981.5731 $1,885,926.70 12,639,796 51,852.767.55 Medium business(G-2) 282 3,622.343 $497,739.29 302 3,334,245 8472,842.56 35,859 799 $4,788,835.15 38.089.389 84.744.092.95 Large business(T.O.U.) 37 6.955,730 $737,752.91 37 6.829.444 $721,622.18 55.981.535. 86.775,197.86 55.226.630 86.286.686.20 Street Lights 65 4.928 51.157.40 65 5.136 $1.155.78 39.424 $9259.20 41,088 $8,747.73 Outdoor Lights 44 5.577 $1,201.63 43 5661 $1.202 70 44,644 $9,620.53 44.848 $9.110.15 Municipal Accounts 134 705,929 $77,205.17 128 665.287 $72,829.42 8,940.390 $761580.13 7 542.148 $782,184.47 Total Commercial 1,897 12.564,604 $1.517.938.15 1.685 11.998,350 51.456,398.72 110,847.365 $14,230.419.37 113.483.899 513,683,569.05 Residential 13,887 5.159,169 5687.379.27 13,759 4,988.682 5642.996.25 52,898,296 $7.040,371.58 56,982,158 87,193.266.50 Power Cost Adjustment $169.340.38 $0.00 81,567.119.78 0 50.00 Aust Total Electric Adjustments 11 7,59 $2,008.40 B 862 $1,939.69 130 895 18 757.96 1.010,177 $107,814.54 Total Electric 15,5. j• 17,706,181 82,352,649.40 15,444 16,980,330 52,097,45528 163,608,766 522.819,122.77 171,456,032 $20,984,650.09 Misc Revenue Billing $75.055.88 $88.788.31 $841,389.08 $820,763.09 Residential 7,283 115,499 $289,830.24 7,252 92.7771 $224,785.26 1,268.802 82,989,425.22 1,305,920 $2,827,881.15 Commercial 917 47.628 $137.637.02 923 41,318 5101,47776 670.369 $1,495,838.84 843,707 $1,272.105.00 Fire Detector Line 195 26 528,746.29 194 132 $23.371.21 258 $214,80221 775 5185.580.15 Industrial 306 43,105 $47,851.19 311 36,145 $49.873.70 341,989 $547,74756 350,550 $507,456.80 Municipal Accounts 151 2,452 $5,787.63 154 2,995 $3,801.19 63.149 $99.377.19 77,222 586,77726 Gott Course/Miller Brewing 2 50,802 $87,442.09 2 64,014 $83,821.28 537,658 8884,292,11 732.839 8983.714.91 Total City Water 8,834 259,512 $596,074.46 8,836 237,381 $487,130.38 2,882,223_ $6,211,483.13 3,111,013 $5,663,495.27 ... .. •z -:v- ,,...ate.. Residential 6,298 131.244 $365,187.73 8,288 143,320 8332,778.12 1,560,675 $3788,383.96 1,854,247 83,307.040.30 Commercial 893 54,632 $110,637.78 884 42,671 $81.019.47 579,000 81.090,988.80 802,586 8972,996.64 Fire Detector Line 101 40 512,303,14 99 52 $10,273.29 201 $91,098.35 389 576,839.48 Industrial 19 20,985 540,875.98 19 18,775 8,109.12, 193,497, $373,533.02 192,036 $321,040.08 Total AV Water 7,111 206,901 $528,804.63 7,000 202,818 2,180.00 2,333,373 85,324,002.13 2,449,258 $4,767,916.50 RWCAF $0.00 $19,620.15 _ $0.00 $253.090.21 CITY/AV WATER TOTAL 15,945 .4$6,413: $1,123,879.09 15,926 440,199 $958,93053 5,215,596 $11,535,485.26 5,560,271 $10,684,501.98 TOTAL ELECTRIC/WATER 83,551.584.35 83,145,174.12 $35,196,997.11 $32,489,915.18 Residential 12.475 5106,334.71 12.380 $101.399.21 $844.93028_ $810,154.98 Commercial 1,587 $20.961.64 1,494 $18,808.97 $187,849.27 5180,787.15 Industrial, 177 $4,584.88 175 $4,81P.77 $42.769.42 $39,654.30 Car Wash&Laundry 11 $302.81 11 8304.65 $2,642.88_ $7,705.65 Total Sewer Adjustments 8278.58 535.41 $6.426.67 ($115.96) Total Sewer 14,250 $132,462.60 14,040 $125,368.01 _ 61,084,618.52 51,038,166.10 6a'-i:'r..W,::I'-L•..=,,it' 13 326. 859 1:1146.' -$201'601:-..; 523 44,16.7: 52:....i7.4 9g GRAND TOTAL BILLING 83,979.40354 83,552.140.01 S38.618,954,37 $35,779,25925 Mnt.Assessments $10.873.75 I 510,830.91 $86.641.32 $86,684.68 • State Surcharge 55.164.76 53.763.31 $38.689.92 $37.937.21 City Tax © Elec.User's Tax 1.111111111111MINIEEESIO $121,028-314 IIIIIIIIMMIMI $1.168,667.31 Water User's Tax -- $29,407-99-- lIl- $300 412.03 Total User's Tax I $163,963.93 $145,788.37 $1,575,794.58 $1,453,020.12 , AZUSALIGHT AND WATER BILLING REPORT MARCH 2011 March 2011 March 2011 March 2010 March 2010 2010.2011 Fiscal Year To Dale 2009-2010 Fiscal Year To Date Customer T es Number of Consumption March 2011 March 2010 Consumption W p Number al ConsumptionConsumption Accounts Billed (kwty�) Billing Accounts Billed (lash/cm6�tg (KwIVCCF) Billinginh/CCF) 6 9 • Small business(6•1) 1.130 1,318,391 5209.881.67 1.122 1,257,794 $200,987.00 13299,964 $2,095,788.37 13,797,590 52,053,75455 Medium business(G-2) 282 3.698.520 $503,877.71 300 3,809,995 $518,366.03 39,558,319 85,292,512.86 41,899,384 55,282,458.98 Large business(f.O.Uj 37 8459,252 5692,319.57 37 8,363.749 $682,677.47 82,440,787 $7,467,517.23 61,590,379 $6,069,363.67 Street Lights 65 4.928 $1,157.40 65 5.138 $1,155.76 44,362 510,418.80 46,224 $9,903.49 Outdoor Lights 43 5,581 $1,202.70 43 5,581 $1,202.70 50,225 $10,823.23 50,229 510,312.85 Municipal Accounts 135 890,818 575.728.86 127 881,888 $74,19556 7,831,206 $837,308.99 8.223.814 $856,360.03 Total Commercial 1.692 12.175,488 51,483.947.91 1,094 12,123,921 51.478,584.52 123,022,853 515,714,367.28 125.607,820 515,162,153.57 Residential 13,885 5,360.848 5894,931.59 13.873 5,480,715 $712,853.94 58.259,142 57,735,303.17 62,442,871 57,908,120.44 Power Cost Adjustment $167,563.15 $0.00 $1,734,882.93 0 $0.00 Total Electric Adjustments 2 81 ($437.89): (18,294)_ ($2512.421 (139,712) ($19,225.85) 991,883 $105,302.12 Total Electric 15,677 17 ,517 $2,346,004.78 15,567 17,586,342 $2,188,926.04 181,142,283 $25,165,127.53 189,042,374 $23,173,576.13 Misc Revenue Billing $76,339.03 - $104,167.45 $917,728.11 $924,930.54 Residential 7,262 109,660 $285,727.27 7.253 105,035 5241,330,00 1,374,985 53,255,152.40 1.410,955 $2,869,191.15 Commercial 614 50,962 5133,088.80 919 48,194 5110.851.86 728,499 $1.628,907.84 891,901 $1,382,756.66 Fire Detector Line 194 28 526,750.32 193 94 523.149.15 297 $241,552.53 869 5208,729.30 Industrial 308 33,660 557,413.87 306 44.260 565,226.48 360,781 $605,161.23 394,800 $572,683.28 Municipal Accounts 152 3,479 55,809.43 155 2,436 53,201.74 67.781 5105.186.62 79,658 589.979.00 Golf Course/Miller Brewing 2 50.893 $88,018.98 2 74807 5101.21921 588.549 $972,311.07 807,846 51,084,934.12 Total City Water 8,532 248,680 $596,788.45 8,828 274,816 $644,778.24 3,120,892 $6,808,271.58 3,385,829 56,208,27351 :w •. Residential 6,222 132,041 5363.653.69 6,233 119,692 $300,026.99 1,692,716 $4,132,037.65 1,773,939' $3.697,067.29 Commercial 550 42,401 586,691.80 541 41,453 573,408.26 821,401 51.177,878.60 644,039 51,046.402.90 Fire Detector Line 92 45 $10,770.69 89 40 $8,932.84 248 $101,889.04 429 $85,772.32 Industrial 19 22,208 543,057.89 20 24,814 $41,594.29 215,705 $416,590.91 210 850 5362.634.37 Total AV Water 8,883 196,685 $504,174.07 6,883 185,999 $423,960.38 2,530,068 55,828,17620 2,635,257 $5,191,876.88 RW CAF $0.00 $20,054.21 $0.00 $273,144.42 CRY/AV WATER TOTAL 15,415 445,375 $1,100,86252 15.926 440,199 $988,792.83 5,650,960 $12,636,447.78 6,021,086 611,673,294.81 TOTAL ELECTRICJWATER $3,523,306.31 $3,281,886.92 $38,719,303.42 $35,771,801.48 Residential 12.484 5106,418.76 12,425 5101,783.88 _ 5951,349,04 $911,938.84 Commercial 1,572 520.524.82 1,512 519,183.45 $208,374.09 $199,950.60 Industrial 178 $4,904.86 178 $5,693.24 $47,674.08 $45,34754 Car V/ash&Laundry 11 $308.33 11 • $327.95 $2,951.21_ $8.033.60 Total Sewer Adjustments $490.73 $1,292.03 $6,917.40 $1.176.07 Total Sewer 14,245 $132,647.30 14,124 $128,28055 $1,217,265.82 $1,166,446.65 F/,> .• Lt., :.:ace .: . II•>-• . . . :5moo.a:i$ ... . ..1f'•:;, . _ .. .. ..t1k4SAIO . .. .1100.4.'t00 . ..... '.. .... .. *`741;x! GRAND TOTAL BILLING $3,951,762.37 $3,695,967.52 $42,570,716.74 $39,475,223.7 Mnt.Assessments $10.608.89 510,855.73 597,450.21 $97540.41 State Surcharge $5.117,44 { 53.909.52 $43,807.36 $41.848.73 C' Tax O Elec.User's Tax $133,472.80 5124,510.w $1.405 855 15 $1,293,478.00 Water User's Tax ` $28,891.01 Cio Total User's Tax $29$162,714.75. j 5329,654.18 $313243.82 - I 5153,701,70 $1,738,509.33 _ $1,606,721.82 a... 2 a Li>. 8 8 ; 8 .9- 8. g'21 R .R. 2 °-' 4 4 8 2 .. `.:,IT 2;°,2. 2. ti 8 ''''' g, :9•• ..:.. .1! 14 TcY V 2,.. g 2 a I q ;- . . . . . . . . . . . . oll . gNIO' - 74q 08 .9- N 0 r•-•:-9 69 0 99„ 0 91 0., %j (7) ii ,,:,.,-". i. 52scS1 2 .41 1 '-'; '":4 '-'17; t ';': 6o. 4 8 i aigit-, Q' wg " 4 ; as 5;fa aa "4 " Ns : w a.. .. 4 ; a 4 92 '3 : 49 49 r, 49 • ' .. . ________ g- r. , .,.:- t. 8 cr;8'ri F-)i.1 ; (-- r: 9.2" W le- gq ,„--. ::-. g r--,g s . 0.8. - g ci' ,L1.. ....-.-.-.. 8 . , . N N 0 - ui co ni 8 ,le N•-• *••0* ., ei .- 4 to • • . 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I .." :5 > 4 u, 5 illf.fliaTit. / I 11.1 *g-1 ,, 7,47,4t_ ..... Tc12_.°Ifcf 1 R W •5 •6 o3 0 -41 .1 5 E_17;11 ii LI (-_, ,5) z ,71 x ,--,,,, m E c0*n.:- -It 3 ,g -1 s E.?1 4.,-...i 6c t,..1 4 1 :,,, E,r, „, ,, a z :ii ,.,, ,.<! 1-.# •:,IirE141 .21117, '- It, 1 101As 1- tEe.gi- 8 . z f 1 093 O/ 6. AZUSA 16,17 d 'NATER INFORMATIONAL ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: THIRD QUARTER BUDGET REPORT FOR WATER AND ELECTRIC FUNDS FOR FISCAL YEAR 2010-11 Attached reports include unaudited budget information regarding the water and electric funds through March 31, 2011. In general, both the water and electric funds have positive net cash flow through the third quarter of FY 2010-11. This is despite the lowest levels of consumption (sales) during same period for the past 7 years for both utilities. Below table shows sales and billing trend for electric utility since FY 04-05 through third quarter of fiscal year: 3rd Quarter Electric Sales/Billings FY kWh Sales Billings _ 04-05 190,471,748 $20,612,794.63 05-06 187,307,423 $20,923,914.66 06-07 198,360,951 $22,360,051.02 07-08 191,906,326 $22,220,739.62 08-09 194,575,820 $24,636,826.89 09-10 189,042,374 $23,173,576.13 10-11 181,142,283 $25,165,127.53 The Power Cost Adjustment in effect through the third quarter of FY 10-11 was critical to the electric utility having positive net cash flow of about $582,000. While this figure is down slightly compared to the 2nd quarter, the positive contribution to electric fund cash reserves has helped bring them up to $12 million from $11.4 million at the end of last FY. This is important considering the reserve policy for the electric utility is $12.6 million. 094 Quarterly Financial Report June 27, 2011 Page 2 The financial performance of electric fund has allowed it to exceed the minimum debt coverage requirement of 1.10 with estimated debt coverage of 6.10 for the period. Below table shows sales and billing trend for water utility since FY 04-05 through 3rd quarter of fiscal year: 3rd Quarter Water Sales/Billings FY CCF Sales Billings 04-05 6,833,381 $11,301,003.92 05-06 7,157,757 $11,096,241.13 06-07 7,689,683 $12,205,584.09 07-08 6,488,230 $11,844,582.36 08-09 6,325,483 $10,660,371.05 09-10 6,021,086 $11,673,294.81 10-11 5,650,960 $12,636,447.78 Although sales for the quarter ended are down compared to the prior six years, recent water rate adjustments have allowed water utility to maintain positive cash flow of about $851,000 through the third quarter. Spending on capital projects has been less during this period than in prior years notwithstanding a $1 million water main replacement project approved recently enabling the utility to have positive cash flow during the sales decline. The Water Utility started off the fiscal year with a $22 million cash reserve according to the Comprehensive Annual Financial Report (CAFR) for FY 09-10, as noted in attached. However, three payments were received in July and August 2011 for water right leases which totaled $3.3 million. These were counted as "Revenue" during FY 2009-10 on CAFR Income Statement, but were not considered "Cash" on the CAFR Balance Sheet since they were received after the end of FY 09-10. Hence, the water right lease cash of$3.3 million plus the net increase in cash for the quarter bring the estimated reserve of the water fund to about $26 million; the current minimum reserve target is $25 million. While debt service payments for the water fund are far greater than the electric fund, the financial performance of water fund has allowed it to exceed the minimum debt coverage requirement of 1.25 with estimated debt coverage of 1.35 for the period. Prepared by: Cary Kalscheuer, Assistant to the Director of Utilities Electric-3rdQtr.pdf Water-3rdQtr.pdf 095 Electric Utility Quarterly Budget Report 3rd Quarter Ended March 31,2011 (UNAUDITED) Consumption and.Reserve Info Prior FY End 3rd Qtr Ended Percent 3/31/11 Consumption-kWh: 245,616,149 181,142,283 73.75% Cash Reserve Policy Amount") $11,439,529 $12,021,117 105% FY 2010-2011 Budget Information Budget Actual Thru Percent of 10-11 03/31/11 Budget Revenue Retail Billing Amounts(2) $31,515,900 $25,165,128 80% Resale Revenue(3) 6,364,025 4,587,687 72% Other Miscellaneous Revenue 303,300 401,170 132% Interest Income 245,715 240,064 98% Total Revenues $38,428,940 $30,394,048 79% Expenses Purchased Power(3) $25,564,120 $18,930,542 74% Transmission/Dispatching 3,942,015 2,861,438 73% Operations and Maintenance 3,408,555 2,303,442 68% Administrative and General(4) 2,419,981 1,960,317 81% Franchise and In-Lieu-Tax 3,456,260 2,559,827 74% Subtotal Expenses $38,790,931 $28,615,566 74% Capital Expenditures/Debt Service Long Term Debt Service(5) $948,615 $711,461 75% Capital Outlays and Projects(6) 1,932,749 490,200 25% Total Expenditures $41,672,295 $29,817,227 72% Adjustments Transfers Out(7) ($9,450) ($4,767) 50% Total Expenditures and Transfers Out $41,662,845 $29,812,460 72% Change in Cash/Reserve ($3,233,905) $581,588 ' 5% Debt Coverage Ratio(8) 3.26 6.10 (1)Source:FY 09-10,CAFR,Unrestricted Cash and Rate Stabilization Fund. Reserve Policy is$12.6 million. (2)Actuals represent amounts billed based on Customer Information System report thru March 31,2011. (3)Source:Power Resources Division. (4)Fund 31 actual and encumbrances plus CIS upgrade multipled by 35% for Electric Fund's share. (5)Based on annual debt service payments for Series B and C,2003 Certificates of Participation. (6)Capital Outlay Accts and Capital Improvement Project budget figures. (7) Interest Income is transferred after fiscal year end if there is positive net income. (8)Total Revenue less Cost for Purch'd Pwr,Trans,O&M,and A&G,divided by debt service. Minimum debt coverage requirement is 1.10 per bond financing agreements. This is preliminary d/c ratio and it may vary with Disclosure Report prepared after the audited financial reports are available,around December 2011. 096 Water Utility Quarterly Budget Report 3rd Quarter Ended March 31,2011 (UNAUDITED) Consumption and Reserve Info Prior FY End 3rd Qtr Ended Percent Consumption-CCF: 7,853,732 5,650,960 72% Cash Reserve Policy Amounts") $ 22,174,446 $ 26,327,036 119% FY 2009-2010 Budget Information Budget Actual Thru Percent of 10-11 3rd Qtr Budget Revenues Retail Billing Amounts(2) $17,521,365 $ 12,636,448 72% Other Revenues 515,000 472,403 92% Interest Income 500,000 37,411 7% Total Revenues $ 18,536,365 $ 13,146,261 71% Expenses Production $3,203,405 $1,833,424 57% Purchased Water 3,212,415 1,235,643 38% Transmission and Distribution 2,515,270 1,851,891 74% Customer Accounting and Sales(3) 4,089,705 3,198,109 78% Administrative and Engineering 983,105 450,262 46% Franchise Fees 390,665 259,770 66% Subtotal Expenses $ 14,394,565 $ 8,829,099 61% Capital Expenditures/Debt Service: Debt Service Payments(4) $4,520,170 $ 3,390,128 75% Capital Improvement Budget(5) 2,194,800 99,332 5% Capital Projects Funded by Bond (23,508) (23,508) 100% Total Expenses (Less Bond Funding) $ 21,086,027 $ 12,295,050 58% Adjustments Transfers Outtb) $0 $0 0% Total Expenditures and Transfers Out $ 21,086,027 $ 12,295,050 58% Net Change in Cash(Negative) $ (2,549,662) $ 851,211 19% Debt Coverage Ratio" 1.00 1.35 Notes: (1)Source:Cash and Investments from FY 09-10 CAFR,plus$3.3 million in water right lease revenue received in July and Auguest of 2010. Reserve Policy is$25 million. (2)Based on Customer Information System Billing Amounts through March 31,2011. (3)Customer Service Allocation to Water Fund,including 65%of Cost of CIS Upgrade Project. (4)Principal and Interest on 2003 COP and 2006 Revenue Bonds thru 3rd quarter of fiscal year. (5)Approved appropriations for multi-year projects,some of which are carryovers from prior year. (6)Half of Interest Income may be transferred by policy if there is positive net income. As of 3/31/2011,no transfers have been made. (7)Total Revenues less Production,Purch'd Wtr,T&D,Cust Acctg,&A&E divided by Debt Svc Pymnts. p r� Minimum debt coverage requirement is 1.25 per bond financing agreements. 097 I AZUSA nur a warry INFORMATION ITEM TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES DATE: JUNE 27, 2011 SUBJECT: BEVERAGE CONTAINER RECYCLING PROGRAM During the budget hearing there were questions regarding the beverage container recycling program or school recycling program. This report provides some background information on that program. Pursuant to the California Beverage Container and Litter Reduction Act, the City of Azusa receives small annual grant funding from the Department of Conservation (now under CalRecyle) which may be used to implement a beverage container recycling program and/or conduct litter clean-up activities. Since 2001, the City has received a total of$123,652 from the State. The funds have been used mainly to purchase fifteen 20-cubic yard roll off bins, called the Module Azusa Recycling Station or MARS-1, and in-classroom recycling receptacles which have been distributed to schools and non-profit organizations free of charge for recycling of newspaper, plastic bottles, and aluminum cans. Some funds have been used in recent years to support the "Think River" litter clean-up activities coordinated by the California Resources Connections. Schools and non-profit organizations, like the Senior Center,have benefited the most from the 20 cubic yard roll off recycling bins. Collectively, they received $104,334 in way of proceeds from the recyclable materials dropped off, and recycled 1,184 tons of materials since the program started. The top three highest proceeds were earned by Azusa Senior Center, Foothill Middle School, and Mountain View Elementary School. Allowing participating schools and non-profits to keep the proceeds has been a good way to encourage recycling. In May, the Department of Conservation approved $12,759 funding for the City to be expended in the next fiscal year. Funds will be used for maintenance of current recycling bins, purchase of in-classroom recycling receptacles if requested, and possibly to fund river clean-up activities. 098 June 27, 2011 Beverage Container Recycling Program Page 2 Staff has received additional requests for 20-cubic yard compartmentalized roll off bins over the past three years but has deferred purchase due to the higher cost of bins. Currently, one container is about $10,000; when we started the program, bins were about $4,000 each. Staff, however, will review the need of additional recycling bins in FY 2011-2012 and may use AB 939 funds to augment cost of purchase if warranted. Prepared by: Cary A. Kalscheuer, Assistant to the Director of Utilities Liza Cawte, Senior Administrative Technician 099