Public Utilities 2022/07/27ITEM #03
briefed the Board on the family of PFAS chemicals, and indicated
that there will be a notice sent to the Anaheim City Council later
this fall about a new constituent, Perfluorohexane Sulfonate
(PFHxS), identified per the State Division of Drinking Water
Regulations. Anaheim Public Utilities (APU) does not have to
install treatment due to the detected levels of PFHxS, only notify
the City Council that it is in the water supply. Staff will monitor
emerging regulations to ensure APU remains in compliance.
C. Parker also briefed the Board on the status of the Groundwater
Treatment Project. Phase A is under construction at most sites and
the design phase is almost complete for Phase B. C. Parker
described that the Project is experiencing global supply chain
impacts, like many other projects in the nation; however, staff is
doing everything possible to mitigate those issues. Phase A is on
track to deliver the treated water by Spring 2023, and Phase B by
Summer 2023.
C. Parker updated the Board on the cost recovery efforts, indicating
that most capital costs are being reimbursed by the Orange County
Water District (OCWD), which significantly reduces APU's cost
burden. A. Kott briefly described the ongoing litigation efforts
regarding chemical companies. Grant funding is also being sought
to address remaining capital and related costs. The goal is to
recover imported water costs, capital costs, and ongoing operational
costs in order to limit rate impacts to customers.
The Board asked if this treatment project would be able to treat
other chemicals, such as pharmaceuticals or other types of PFAS. C.
Parker shared with the Board that while ion exchange is designed to
be flexible and address a number of PFAS constituents, special
treatment will have to be evaluated for other water quality issues to
address future regulations. C. Parker indicated that other wells will
most likely require PFAS treatment when future regulations are
released. Staff is currently evaluating how to install treatment at
those sites. The treatment system will treat to non -detect levels,
basically what testing can be measured to today. C. Parker indicated
that the treatment facilities test the well water quarterly because
water quality does not change significantly over time.
The Board asked if the resin is regenerated or disposed of, and how
the disposal takes place. C. Parker answered that it is not
regenerated, it is disposed of at authorized facilities. At a later date
there will be a determination as to which disposal method is to be
utilized. The Board asked if the litigation was being performed by
each agency or jointly. A. Kott, Assistant City Attorney, indicated
the litigation is jointly being handled with the other affected
agencies.
2022 - 51
4. APPROVAL OF A COLLECTION SERVICES AGREEMENT
WITH RAY KLEIN, INC., DBA PROFESSIONAL CREDIT
SERVICES TO PROVIDE COLLECTION SERVICES
RELATED TO UNCOLLECTABLE UTILITY CLOSING
BILLS FOR AN INITIAL TERM OF FIVE (5) YEARS AND UP
TO FOUR (4) ONE-YEAR EXTENSIONS IN A NOT -TO -
EXCEED AMOUNT OF $241,675 FOR THE INITIAL TERM
AND $48,335 PER YEAR FOR EACH OF THE ONE-YEAR
EXTENSIONS. *
J. Lehman, Assistant General Manager - Administration & Risk
Services, asked the Board to recommend that the City Council
approve a Collection Services Agreement with Ray Klein, Inc.,
DBA Professional Credit Service (PCS) for utility collection
services.
J. Lehman explained that PCS has been assisting APU in the
recovery of unpaid balances since 2016. J. Lehman shared that the
evaluation process followed Council Policy 4.1, and indicated that
APU took special care to ensure that the vendor selected understood
APU's requirement to treat all customers with dignity and respect
during all recovery efforts. PCS has representatives that speak a
number of different languages, and who are fully trained for
compliance with collection laws and regulations.
The Board inquired about the payment terms, and staff confirmed
that the amount covers the five-year term, with one-year optional
extensions thereafter.
5. APPROVAL OF AN AGREEMENT FOR UNDERGROUND
UTILITY LOCATING SERVICES (LOCATING SERVICES)
WITH KANA SUBSTRUCTURE ENGINEERING, INC. FOR
AN INITIAL TERM OF ONE YEAR AND UP TO FIVE ONE-
YEAR EXTENSIONS IN THE AMOUNT OF $762,450 FOR
THE INITIAL TERM WITH CONSUMER PRICE INDEX
(CPI) ADJUSTMENTS FOR EACH ONE-YEAR EXTENSION,
PLUS AN ADDITIONAL 15% FOR AS -NEEDED EXTRA
SERVICES; AND DETERMINE THAT THE LOCATING
SERVICES ARE CATEGORICALLY EXEMPT UNDER THE
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
PURSUANT SECTIONS15061(B)(3) AND 15301(B) OF TITLE
14 OF THE CALIFORNIA CODE OF REGULATIONS. *
F. Barvarz, Electric Transmission and Distribution Manager,
requested that the Board recommend that the City Council approve
the Agreement for Underground Utility Locating Services. F.
A. Abdulrahman moved the
approval of the Collection
Services Agreement with
Professional Credit Services.
Vice -Chairperson V. Baroldi
seconded the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1. [R. Bhalla].
2022 - 52
Barvarz explained the need to mark the pavement where APU's
1,500 miles of underground water, high voltage electric, and fiber
optic lines are located, to protect them if construction is scheduled
in their vicinity. F. Barvarz then covered the standardized colors
used to mark different lines, the need to call 811, or contact
DigAlert.org 2-14 days before excavations begin, and shared details
about the Agreement.
The Board asked about the Request for Proposal (RFP) evaluation
process, the prospective bidder outreach, and how the locating
process works. Staff addressed the questions and explained that
certain firms tend to work with private utilities and were not
inclined to bid on municipal RFPs, which is likely why there were
only several bids received. The Board also inquired why there is a
need for a 15% extra work authority, and staff explained that
pricing was based on an estimated number of location requests, and
the 15% provides flexibility to accommodate fluctuations in the
number of requests. The Board requested that APU provide
information regarding the DigAlert on APU's website.
6. RECOMMEND APPROVAL OF AN ENVIRONMENTAL
SERVICES CONSULTING AGREEMENT (AGREEMENT)
FOR AS -NEEDED ENVIRONMENTAL SERVICES IN A
NOT -TO -EXCEED AMOUNT OF $500,000 PER
CONSULTANT, WITH AUTHORIZATION FOR UP TO 15%
IN EXTRA WORK, FOR THE ENTIRE FIVE-YEAR TERM
OF THE AGREEMENT AND UP TO TWO ONE-YEAR
EXTENSIONS, AS NEEDED, TO COMPLETE ONGOING
PROJECTS; AUTHORIZE THE PUBLIC UTILITIES
GENERAL MANAGER, OR DESIGNEE, TO EXECUTE THE
AGREEMENT SEPARATELY WITH THE FOLLOWING
PREQUALIFIED CONSULTANTS AND SUCH OTHER
ENVIRONMENTAL SERVICES CONSULTANTS AS MAY
BE PREQUALIFIED DURING THE TERM OF THE
AGREEMENT: ATLAS TECHNICAL CONSULTANTS LLC;
EFI GLOBAL, INC.; LEIGHTON CONSULTING, INC.;
PSOMAS; STANTEC CONSULTING SERVICES, INC.;
VANDERMOST CONSULTING SERVICES, INC. *
J. Lehman, Assistant General Manager - Administration & Risk
Services, requested that the Board recommend that the City Council
approve the Environmental Services Consulting Agreement
(Agreement) with six vendors. The background information
provided by J. Lehman indicated that the Agreements will allow
APU to provide a wide range of environmental services and will
help to ensure that technical expertise and support are available
quickly in response to critical projects or events. J. Lehman
Staff will add information
for DigAlert on the website.
M. Lee moved the approval
of the Agreement for
Underground Utility
Locating Services with Kana
Substructure Engineering,
Inc. N. Campos Kurtz
seconded the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1. [R. Bhalla].
A. Pham moved the
approval of the six
Environmental Services
Consulting Agreements. M.
Lee seconded the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1. [R. Bhalla].
2022 - 53
indicated that these resources are necessary to help APU comply
with numerous federal and state environmental laws, regulations,
and permits.
7. APPROVAL OF THE SECOND AMENDMENT TO THE
INFORMATION SYSTEM AGREEMENT (SECOND
AMENDMENT), WHICH IS IN SUBSTANTIALLY FINAL
FORM, WITH SYSTEMS & SOFTWARE, INC. FOR THE
UPGRADE OF THE CUSTOMER INFORMATION SYSTEM
(CIS), WHICH INCLUDES POST -IMPLEMENTATION
SERVICES AND UPDATES TO SOFTWARE LICENSES AND
OTHER AGREEMENT TERMS, IN AN AMOUNT NOT -TO -
EXCEED $1,114,000 PLUS A 15% CONTINGENCY FOR
EXTRA WORK; SUPPORT AND MAINTENANCE FEES IN
AN ANNUAL AMOUNT NOT -TO -EXCEED $311,000 WITH
AN ANNUAL ESCALATOR NOT -TO -EXCEED 3%; AND
AUTHORIZE THE PUBLIC UTILITIES GENERAL
MANAGER OR DESIGNEE TO EXECUTE ORDER FORMS,
WORK ORDERS, AND RELATED DOCUMENTS FOR
SOFTWARE LICENSES, SUBSCRIPTIONS,
MAINTENANCE, AND SERVICES FOR CIS
IMPROVEMENTS AN AMOUNT NOT -TO -EXCEED
$200,000. *
B. Beelner, Assistant General Manager - Finance & Energy
Resources, presented to the Board an overview of the Customer
Information System (CIS), the history of its implementation, the
need to upgrade it, and information about the proposed agreement
second amendment with S&S. B. Beelner explained that the CIS is
a mission critical system used to store customer information,
perform field work orders, process electric and water meter data,
produce over 1 million bills per year totaling over $500 million for
electric, water, sanitation, and paramedic subscription services,
accept customer payments, and provide customer service. The
system was purchased in 2012 and went live in 2014. The hardware
and some of the software is nearing the end of its useful life and
requires both software and hardware upgrades. The proposed
upgrade will improve reliability, implement new features that will
improve operational efficiencies and ability to process advanced
rates, improve system performance, improve customer web portal
experience, and provide customers better tools to manage their
usage. B. Beelner showed samples of existing and new customer
web portal screens to illustrate the modern look and capability of
the new customer portal.
The Board asked about data migration for the upgrade. B. Beelner
responded that it will not require a full data conversion because it is
an upgrade to the same software, albeit a new version. As such, the
data migration risk will be relatively low. The Board asked if it was
A. Abdulrahman moved the
approval of the Second
Amendment to the
Information System
Agreement with S&S. N.
Campos Kurtz seconded the
motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1. [R. Bhalla].
2022 - 54
a custom solution. B. Beeler responded that it is commercial off -
the -shelf software. The Board asked how the customer web portal
will be promoted. D. Lee, Public Utilities General Manager,
responded that bill inserts are typically the primary method but
other channels like social media can be used. There was discussion
about a mobile app. Staff explained that the new customer web
portal is browser -based and mobile -friendly. The City of Anaheim
(City) has other apps, so adding a new one is something that would
need to be carefully considered. The Board inquired about the costs.
D. Lee and B. Beelner explained that the system includes more than
just a customer web portal. There is a backend system that is
complex, integrated with other systems, and includes many features
including real-time credit checks, customer address validation to
reduce returned mail, ability for customers to notate events on their
usage charts, and other features. The backend effort is about
seventy-five percent of the cost of the upgrade. The Board asked if
the data in the new portal would be in real-time. B. Beelner
responded that those customers with Advanced Meter Infrastructure
(AMI) meters would be near real-time but not those with manual
meters. Council Member G. Ma'ae asked how many customers are
on AMI meters. D. Lee responded that there are around 75,000 of
120,000 AMI meters. Other than a small pilot, Water AMI meters
have not been implemented. There are challenges with water AMI
meters such as power and access, but it is a future initiative.
8. QUARTERLY STATUS REPORTS ON CAPITAL
IMPROVEMENT PROJECTS, MASTER AGREEMENTS,
GENERAL SERVICES AGREEMENTS, AND SPOT BID
AWARDS.
M. Moore, Assistant General Manager — Water Services, provided
an update on the Master Construction Agreements and CIP
dashboard for Water Services for the period ending June 2022. The
CIP dashboard shows over 95% of the Water Capital Improvement
Program was encumbered or completed in fiscal year 2021/22. This
is the most that Water Services has completed and reflects good
cooperation between APU and the Public Works Contract
Administrative team.
J. Lonneker, Assistant General Manager — Electric Services,
provided an update on Electric capital projects. She explained that
due to supply chain issues, there have been issued with sourcing
equipment for projects and as a result, additional procurements of
materials were made to try meet project needs.
9. UPDATE ON ELECTRIC SYSTEM ITEMS.
J. Lonneker shared with the Board that due to the relatively mild
ambient temperatures and low wind speeds, power outages during
2022 - 55
the month of July were contained to small areas with relatively
short durations.
Additionally, J. Lonneker explained to the Board that engineering
design to improve reliability along Harbor Boulevard, south of
Katella Avenue, is underway and staff is currently obtaining the
necessary easements. Long duration power outages to businesses in
this area over the past years became a priority for upgrades to the
electric system to improve reliability.
10. UPDATE ON WATER SYSTEM ITEMS.
M. Moore provided an overview of the Water Supply dashboard.
Water levels in the Colorado River continue to decline. Drought
conditions will likely worsen next year as they enter additional
short levels. Anaheim is currently at level 2 in its Water Shortage
Contingency Plan, which limits outdoor irrigation to 3 days per
week. APU has been actively sharing information about the
watering restrictions to customers in their bills, outreach events,
advertising in magazines and newspapers, and social media.
Water levels in the Walnut Canyon Reservoir in east Anaheim will
continue to decline through the summer. APU purchases less
imported water during the summer months and more in the winter
months when water supply costs are less expensive. The reservoir
will start to fill again in October.
The Board was notified of two upcoming events. The OC Water
Summit, which will be held in Anaheim on September 18, and a
Colorado River Aqueduct tour, which will be held on November
18-20.
11. UPDATE ON FINANCE & ENERGY RESOURCES ITEMS.
B. Beelner discussed the monthly Finance dashboard with the
Board. The year to date electric revenue through June, 2022 was
0.2% above budget ($1.OM). Electric costs for the fiscal year to date
fell below budget by 5.2% ($19.8M) causing a net positive budget
variance of $20.8M. B. Beelner then mentioned that year to date
water revenue was 1.5% ($1.5M) above budget. However, water
operating costs fell below budget by 8.0% ($6.7M) causing a net
positive budget variance of $8.2M.
B. Beelner presented the Power Supply dashboard and discussed the
higher than typical amount of wholesale energy purchases. These
purchases were due to a reduction in conventional and renewable
power, as natural gas prices have spiked recently, making Canyon
Power Plant not economical to run as compared to the cheaper
2022 - 56
wholesale market. B. Beelner then discussed the recent fire at
Hoover Dam and its de minimis impact to APU.
The Board asked B. Beelner about the status of the Battery Energy
Storage project. B. Beelner responded that proposals are due from
contractors in September with the expectation that construction will
occur in 2023 and operation will begin in 2024.
12. UPDATE ON ADMINISTRATION & RISK SERVICES
ITEMS.
J. Lehman provided the Board an update on the Wholesale Energy
Risk Management (ERM) Program's Quarterly Compliance report
for the third quarter of FY 22. J. Lehman indicated that during this
period there were no violations of the Wholesale ERM Program,
and that all transactions were within the ERM requirements.
J. Lehman then provided an update on the Administration and Risk
Services Dashboard where she highlighted three bills of interest and
then reviewed the safety metrics for the month.
13. ITEMS BY SECRETARY.
D. Lee, Public Utilities General Manager, mentioned that he will not
be in attendance at the Board's next Regular Meeting on August 24,
2022, but that B. Beelner would serve as the Acting General Manager
at the meeting.
D. Lee provided an update on the budget that was approved by City
Council last month. APU's budget was approved with no exceptions
taken. D. Lee thanked the Board for their review and City Council for
their approval.
D. Lee shared the new water bottle label designs with the Board. The
2022 winners of the Water Bottle Label Art Contest were recognized
by City Council.
D. Lee shared agenda items planned for next month:
• Approval of Department Orders (DO):
o DO 105 — Processing City Council and Public Utilities
Board Agenda Items
o New DO — Procedure for Public Notification of
Construction Projects
• Utility Success Indicators
• APU Response to Customer Arrearages Presentation
• Summer Internship Program Presentation
2022 - 57
D. Lee shared photos of the 4 h of July Event at Peralta Park. This
event allows the community to see a different side of APU and gives
employees a chance to engage with customers through bucket truck
rides.
D. Lee updated the Board on APU's participation at the flashlight
walk that took place at the multi -family residences near Euclid and
La Palma. Council Member Moreno requested that several City
Departments attend and provide information on different programs
offered to residents. D. Lee shared photographs and added that APU
is working on improving the lighting in this area.
14. ITEMS BY BOARD MEMBERS
A. Pham thanked M. Moore for taking him on a tour of APU water
safety construction sites. A. Pham also thanked Water staff for their
efforts to troubleshoot a water bill concern with his Homeowners
Association and added that the Water meter technicians were very
helpful.
M. Lee stated that he has heard over several meetings about the
success of design -build for project delivery. M. Lee then discussed
the community's concern regarding the need for more water and
power instead of new housing. Due to the housing element
requiring 17,000 units over the next 10 years, he asked how the City
is balancing the need for housing with the resources the City has. D.
Lee responded that water and power usage in the City is flat and, in
some cases, declining due to conservation. There have been long-
term benefits from conservation, such as turf and appliance
replacement, and new developments are utilizing the latest building
codes to increase efficiency. D. Lee confirmed that there have been
no large spikes in water and electricity usage, even with electric
vehicles and new developments, and the overall usage has been
trending downward. M. Lee thanked APU for their overall response
time to customer inquiries and for educating the public on utility
markings.
N. Campos Kurtz thanked M. Moore for arranging tours of APU
water safety construction sites; she has a better understanding of the
importance of keeping APU employees safe and appreciated Water
Inspection Supervisor, S. Noble, in emphasizing the importance of
safety to his team and for taking safety seriously on water projects.
A. Abdulrahman asked about the status of the resident who
contested his bill. A. Kott, Assistant City Attorney, responded that
since the resident has filed a claim with the City, she can only
confirm that APU is involved and working with the customer.
2022 - 58
V. Baroldi thanked staff for providing information regarding
electric vehicle rebates.
Council Member G. Ma'ae thanked M. Moore for providing a tour
of the Groundwater Treatment Plant construction sites and added
that she enjoyed seeing City employees at Center Greens Park on
Employee Appreciation Day. While speaking with those in different
Departments, she noted the sense of pride City employees have.
15. ADJOURNMENT: (NEXT REGULAR MEETING ON
AUGUST 24, 2022 AT 5:00 P.M.)
Res ectfully sub itted,
Dukku Lee
Public Utilities General Manager
M. Lee moved to adjourn
the Regular Meeting in the
Gordon Hoyt Conference
Center at 6:35 p.m. to the
Board's Regular Meeting
date of August 24, 2022 at
5:00 p.m. A. Pham seconded
the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1. [R. Bhalla].
* Indicates item(s) that will be forwarded to City Council for action upon recommendation by the
Board.
* * Indicates item(s) that will be forwarded to City Clerk and City Council for informational purposes.
2022 - 59