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1973/01/09~itY Hall, Anaheim; California - COUNCI~ MINUTES - January 9; 1973; 1:30 PoM. PRESENT: ABSENT: PRESENT: The City Council of the City of Anaheim met in regular session. COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton COUNCILMEN: None CITY MANAGER: Keith A. Murdoch ASSISTANT CITY MANAGER: Robert M. Davis CITY ATTORNEY: Joseph Bo Geisler ASSISTANT CITY ATTORNEY: John H. Dawson CITY CL~RK: Dene M. Daoust DIRECTOR OF PUBLIC WORKS: Thornton E. Piefsall UTILITIES DIRECTOR: Gordon Hoyt CITY ENGINEER: James P. Maddox ASSISTANT CITY ENGINEER: Ralph O. Pease ASSISTANT DIRECTOR OF DEVELOPMENT SERVICES: Ronald Thompson WATER SUPERINTENDENT: Larry M. Sears ZONING SUPERVISOR: Charles Roberts Mayor Dutton called the meeting to order. FLAG SALUTE: Councilman W. Jo Thom led the Assembly in the Pledge of Allegiance to the Flag. INTRODUCTION OF NEW EMPLOYEES: Mr. Frank Campagnoni, of the City Personnel Department, introduced 22 new employees attending the Council meeting as part of the City's orientation program. Mayor Dutton welcomed the new employees. ~iNUTES: Minutes of the Anaheim City Council Regular Meetings held December 12 and December 19, 1972 were approved on motion by Councilman Thom, seconded by Councilman Pebley. Because of absence, Councilman Stephenson abstained from voting on approval of the minutes of December 12, 1972. MOTION CARRIED. ~AiVER OF READING - ORDINANCES AND RESOLUTIONS: Councilman Thom moved to waive the reading in full of all ordinances and resolutions, and that consent to the waiver of reading is hereby given by all Councilmen unless, after reading of such titles, specific request is made by a Councilman for the reading of such ordinance or resolution. Councilman Pebley seconded the motion. MOTION UNANIMOUSLY CARRIED. {EPORT - FINANCIAL DEMANDS AGAINST THE CITY: Demands against the City in the amount of $1,325,903.95, in accordance with the 1972-73- Budget, were approved. £ARTH SLIDE - SOUTH SIDE OF SANTIAGO BOULEVARD; ADJACENT TO THE NEWPORT FREEWAY: Due to the great concern expressed by ~°meowners in the hill and canyon area and the wide publicity being received in regard to the recent events surrounding the earth slippage on the south side of Santiago Boulevard, Mayor Dutton presented to the City Council a report prepared by the City Engineer in response to his request. He thereupon read the report dated January 9, 1973 in full. Said report stated in brief: Santiago Boulevard and the abutting slope were graded by State's contractor in accordance with State plans and regulations as a portion of the Newport Freeway construction in about 1961. The tract lying south of the State right of way and the slope were graded under City regulations in mid 1964. Circle Haven Road itself and three of the homes sites appear to be entirely on cut, one hom~ slt~ is partially on cut and partially on fill. The maximum difference in elevation between the roadway surface of Santiago Boulevard, as existing previous to the slide, and the highest lot pad was approximately 58 foot. The State Division of Highways maintenance crews have accom- plished the following work since the afternoon of January 4: 1. The existing, pavement in Santiago Boulevard through the slide area was broken to provide bond for a buttress fill. City Hall; Anaheim~ California - COUNCIL MINUTES - January 9~ 1973, 1:30 PoM. 2. The elevation of Santiago Boulevard was raised by im- ported dirt approximately ten to fifteen feet providing a buttress fill to stabilize the slope. 3. The fissure in the hillside has been filled and the area regraded to provide increased stability and improved drainage in the event rains occur. 4. Horizontal and vertical drilling to obtain geological information has been performed in part and monitoring equipment has been installed to determine the extent of future work that may be required. The City Engineer's report indicated that if the buttress fill on Santiago Boulevard is to remain in place permanently, it will be necessary to raise the intersection of Santiago Boulevard and Nohl Canyon Road, requiring Nohl Canyon Road also to be raised approximately 130 feet south to meet the grade. In addition the 12-inch sanitary sewer in Santiago Boulevard has been broken within the slide area and the City of Anaheim is temporarily pumping the sewage effluent around the effected area. Plans are being prepared to construct a replacement sewer facility at a preliminary estimated cost of $42,000.00. To date, the cost of pumping is approximately $2,150.00~ 73-9 Councilman Dutton noted that the grading in the subject slide area was done by the State of California prior to the time that the City of Anaheim had adopted ordinances relative to hillside grading, and that the State is responsible for Santiago Boulevard. Councilman Dutton reported that the City's hillside grading ordinances are as stringent as those in Los Angeles, Ventura, and Orange County, and are similar in principle. To allay the fears of the residents in the area, Councilman Dutton moved that the City Council authorize the City Engineer to employ a consultant engineering firm to review the City's grading ordinances. Mr. Maddox advised that the sum of $2,000.00 was a logical cost of such a study and that a report could be expected within four to six weeks. Councilman Stephenson questioned the necessity of forming an analysis of the grading ordinances strictly on the basis of the slide situation east of Santiago Boulevard, noting that subject slide area was not graded but built on cuts. Councilman Dutton remarked that his recommendation was based on the fact that for some time, there has been concern expressed regarding grading procedures and the City's ordinances, and since earth slides are a problem in all areas of this State, it would be well for the Council to undertake such investigation. Councilman Tk~'~m concurred with the recommendation, stating he felt it was long overdue. He remarked that the consultant who is hired for this review should I>~ an engineering geologist who is not presently involved in any of the hill and canyon area development. He further stated that he would re- quest the report be an in-depth study of the gradin~ ordinances and set forth what the acceptable risk limits should be in the hill and canyon areas. Councilman Dutton stated he was in agreement with the stipulation that the consultant be an engineering geologist not presently involved with any de- veloper in the subject area. In answer to Councilman Stephenson's question regarding the extent of the cut performed at the present slide site, Mr. Maddox reported that ~3-10 Hall~ Anaheim~ California - COUNCIL MINUTES - January 9~ 1973~ 1~30 P.M. the cut would be estimated to be no more than 40 foot, and the 58 foot figure reflects the total differentiation between the raodway prior to the filling and the highest pad elevation in the tract. Councilman Dutton related his recollection of the history of slides along the old Santa Ana Canyon Road and recommended that a geological report be prerequisite to the City's acceptance of this road from the State. Councilman Dutton restated his previous motion authorizing the City Engineer to employ a geological engineering firm to conduct a review of the City's grading ordinances, on a hourly basis, the cost not to exceed $2,000.00; said firm not to be under contract or otherwise involved with any of the hill and canyon area developers. Councilman Thom seconded the motion. MOTION CARRIED. Councilman Thom asked if the scope of the work to be performed would be strictly limited to the grading ordinances, to which Mr. Maddox replied in the affirimative and that they will be reviewed in relationship to ordinances adopted by other cities with similar topography. ~ESOLUTION NO. 73R-7 - AWARD OF WORK ORDER NO. 651-B: In accordance with recommen- dations of the City Engineer, Councilman Pebley offered Resolution No. 73R-7 for adoption. Refer to Resolution Book. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM ACCEPTING A SEALED PROPOSAL AND AWARDING A CONTRACT TO THE LOWEST RESPONSIBLE BIDDER FOR THE FURNISHING OF ALL PLANT, LABOR, SERVICES, MATERIALS AND EQUIPMENT AND ALL UTILITIES AND TRANSPORTATION, INCLUDING POWER, FUEL AND WATER, AND PERFORM- ING ALL WORK NECESSARY TO CONSTRUCT AND COMPLETE THE FOLLOWING PUBLIC IMPROVEMENT: THE BALL ROAD STREET AND STORM DRAIN IMPROVEMENT, FROM EUCLID STREET TO BROOKHURST STREET~ IN THE CITY OF ANAHEIM, WORK ORDER NO. 651-B. (Moses Galluzzo - base bid, $188,702.95) Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton None None The Mayor declared Resolution No. 73R-7 duly passed and adopted. ESOLUTION NO. 73R-8 - AWARD OF WORK ORDER NO. 793: In accordance with recommendations of the City Engineer, Councilman Thom offered Resolution No. 73R-8 for adoption. Refer to Resolution Book. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM ACCEPTING A SEALED PROPOS~L AND AWA~IDING A CONTR_~CT TO THE LOWEST RESPONSIBLE BIDDER FOR THE FURNISHING OF ALL PLANT, LABOR~ SERVICES, MATERIALS AND EQUIPMENT AND ALL UTILITIES AND TRANSPORTATION, INCLUDING POWER, FUEL AND WATER, AND PERFORM- ING ALL WORK NECESSARY TO CONSTRUCT AND COMPLETE THE FOLLOWING PUBLIC IMPROVEMENT: THE MANZANITA PARK CONCRETE IMPROVEMENTS AND MASONRY WALL, NORTH OF RIVIERA STREET, IN THE CITY OF ANAHEIM, WORK ORDER NO. 793. (Goodman and Peloquin - $36,384.60) / Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton None None 73-11 ~naheim~California - COUNCIL MINUTES - Januar 9 1973 1:30 P.M. The Mayor declared Resolution No. 73R-8 duly passed and adopted. RESOLUTION NOo 73R-9 - DEEDS OF EASEMENT: Councilman Dutton offered Resolution No. 73R-9 for adoption. Refer to Resolution Book. A RESOLUTION OF THE CITY COb~CIL OF THE CITY OF ANAHEIM ACCEPTING CERTAIN DEEDS AND ORDERING THEIR RECORDATION. (Robert F. Campbell and June E. Campbell; Cherokee Mobile ~ardens; William Ao Rossworn) Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, ?ebley, Thom and Dutton None None The Mayor declared Resolution No. 73R-9 duly passed and adopted. PROPOSED ABANDONMENT - RESOLUTIqN NO. 73R-10: Councilman Stephenson offered Resolution No. 73R-10 for adoption. Refer to Resolution Book. A RESOLUTION OF THE CITY CODNCIL OF THE CITY OF ANAHEIM DECLARING ITS INTENTION TO VACATE CERTAIN REAL PROPERTY AND FIXING A DATE FOR HEARING THEREON. (No. 72-8A, January 30, 1973, 1:30 P.M.; east side of State College Boulevard, north of Wagner Avenue) Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton None None The Mayor. declared Resolution No. 73R-10 duly passed and adopted. CLAIMS AGAINST THE CITY: The following claims were denied, as recommended by the City Attorney, and ordered referred to the insurance carrier on motion by Councilman Pebley, seconded by Councilman Sneegas: a. Claim submitted by Ruth B. Teeple for purported personal property damage to vehicle sustained as a result of City truck backing into her, on or about January 2, 1973. b. Claim submitted by Theodore J. Crayne, in behalf of Rex G. Crayne, for purported personal injuries resulting from an accident on Ball Road due to negligent warning on the part of the City sustained on or about September 22, 1.~2 c. Claim submitted by Elsie McClain, for purported personal property damage sustained as a result of an accident with City vehicle on or about October 16, 1972. MOTION CARRIED. CORRESPONDENCE: The following correspondence was ordered received and filed on motion by Councilman Stephenmon, seconded by Councilman Sneegas: a. Anaheim Public Library Board - Minutes - November 20, 1972. MOTION CARRIED° ORDINANCE NO. 3118: Councilman Dutton offered Ordinance Noo 3118 for first reading. AN ORDINANCE OF THE CITY OF ANAHEIM AMENDING TITLE 18 OF THE ANAHEIM MUNICIPAL CODE RELATING TO ZONING° (72-73-3 - C-l) ORDINANCE NO. 3119: Councilman Sneegas offered Ordinance No. 3119 for first reading° _:iL' Hail;zz_t~.._tnz,~ahc~n.:~_~ ~ California - COUNCIL MINUTES - Januar~ 9~ 1973~ 1:30 P.M. AP~ OR],I~ANC? OF THE CITY OF ANAHEIM AMENDING TITLE 18 OF THE AIqAHEIM MI~!ICIPM CODE RELATING T© ZONINC. (7~-7~-22 - R-l) )RDINANCE NO. 31,!0: r~ ad ~ ng ,. Councilman Stephenson ¢~ffered Ordinance No. 3120 for first AN ORDINANCE O¥ THE CITY OF ANAHEIM AMENDING TITLE 18 OF THE ANAHEIM MUNICIPAl. CODE RELATING TO ZONING. (72-73-12 - R-l) )RDINANCE NO. 3121: Councihnan Fhom offered Ordinance No. 3121 for first reading. AN ORDINAN{;i~i OF THE CITY OF ANAHEIM AMENDING TITLE 18 OF THE ANAHEIM MUNICIPAI C.()I)E RELATING 'FO ZONING. (6q-70-31 (4) - M-i) }RDINANCE NO. 3[22: Councilman Sneegas offered Ordinance No. 3122 for first reading. AN ORDINANCE OF THE CITY OF ANAHEIM /LMENDING TITLE 18 OF THE ANAHEIM MI!NICIP^I. CODE RELATING TO ZONING. (71-72-15 (3) - R-H-iO,O00) RDiNA~CE 'NO. 3~_23: Councilman St:ephenson offered Ordinance No. 3123 for first re ading. AN ORDINANCE OF THE CITY OF ANAHEIM AMENDING TITLE 18 OF THE ANAHEIM MUNICIPAI, CODE RELATING TO ZONING. (72-73-15 - RS-5000) ETTER AGREE_MENi - DRAINAGE STRUCTURE TRACT NO. 6931: In connection with Tract No. 6931, agreement from Walter B. Gintner, owner of Lot No. 24, in adjacent Tract Ne. 4(')'~), a~suming full responsibility for any and all liability for leaving a dra:~g~ ~rnccure in place~ and for removing said structure at the request oi thc City was received and recordation thereof authorized on motion by Councitman Sneegas, seconded by Councilman Stephenson. MOTION CARRIED. RDINANCE NO. 3124: Councilman Pebley offered Ordinance No. 3124 for first reading. Al< ORI)IN/~NCE OF FHE CiTY OF ANAHEIM AMENDING TITLE 18 OF THE ANAHEIM MUNICiPAl.. CODE RELATI~]G 'FO ZONING. (71-72-45 - RS-5000) RDINAiNCE NO. ~125: Councilman Stephenson offered Ordinance No. 3125 for first reading. AN ORDINAg~CE OF THE CIPY OF ANAHIEIM AbIENDING TITLE 18 OF THE ANAHEIM MUNICIPAL CODE RELATING TO ZONING. (70-71-12 - R-3) .W~ENDMENT TO RESOLUTION NO. 71R-190 (RECLASSIFICATION NO. 70-71-35): Request from J. N. Sharp, Prime Contractors Inc., dated December 18, 1972 to proceed with reclas~Jfication of Parcel No~. B and C only of property located on the north side c~f Placentia Avenue, east of State College Boulevard (R-3 zoning approved pursuant to Resolution No. 71R-190) was submitted and recommended by Mr. Roberts who advised that Parcel No. A is a landlocked parcel, however proceeding with Parcel No~. B and C will not alter this property owner's original position in regard to acqu{s{t{on o£ street access. RESOLUTION NO. 73R-11: Councilman Peblev offered Resolution No. 73R-11 for adoption amending Condition No. ]2 an(] adding Condition No. 15 to Resolution No. 7!R-lqO, as follox, z¢~: 1.2. That a vehicular access easement across the property to the south of Parce! A for J. ngre.~:~ and ~r~ to Parc~i A, ~d]all be submitted to and approved by th~ I ~.~ ~tt:,'~rncv'.~ (~,f'f~, ~ ', ~; ~:ec' " ,~ ~ ~'~'~'~'~ ~:~ ~h.~ introduction of an Ordina~,~ o~ Parcel [5. That ordinances reclassifying the property shall be adopted as each parcel is ready to comply with conditions pertaining to such parcel, 73-13 City Hall~ Anaheim~ California - COUNCIL MINUTES - January 9~ 1973~ 1:30 PoM. provided however, that the word "parcel" shall mean presently existing parcels of record and any parcel or parcels approved by the City Council for lot split. Refer to Resolution Book. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM AMENDING RESOLUTION NO. 71R-190 IN RECLASSIFICATION PROCEEDINGS NOo 70-71-35. Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton None None The Mayor declared Resolution No. 73R-11 duly passed and adopted. ORDINANCE NO. 3126: Councilman Pebley offered Ordinance No. 3126 for first reading. AN ORDINANCE OF THE CITY OF ANAHEIM AMENDING TITLE 18 OF THE ANAHEIM MUNICIPAL CODE RELATING TO ZONING. (70-71-35 - R-3 - Parcel Nos. B and C) RESOLUTION NOo 73R-12 - AGREEMENT WITH ANAHEIM UNION HIGH SCHOOL - USE OF ANAHEI~.I MUNICIPAL AND ANAHEIM HILLS GO~F COURSES: Councilman Stephenson offered Resolution No. 73R-12 for adoption. Refer to Resolution Book. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM PERMITTING THE ANAHEIM UNION HIGH SCHOOL DISTRICT TO UTILIZE THE ANAHEIM MUNICIPAL AND THE ANAHEIM HILLS GOLF COURSES. Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton None None The Mayor declared Resolution No. 73R-12 duly passed and adopted. RESOLUTION NO. 73R-13 - AGREEMENT WITH CYPRESS JUNIOR COLLEGE - USE OF ANAHEIm., HILLS GOLF COURSE: Councilman Sneegas offered Resolution No. 73R-13 for adoption. Refer to Resolution Book. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM PERMITTING CYPRESS COLLEGE GOLF TEAM TO ENGAGE IN PRACTICE GOLF MATCH PLAY AT ANAHEIM HILLS GOLF COURSE. Roll Call Vote: AYES: COUNCILMEN: NOES: COUNCILMEN: ABSENT: COUNCILMEN: Sneegas, Stephenson, Pebley, Thom and Dutton None None The Mayor declared Resolution No. 73R-13 duly passed and adopted. RULE NO. 15 - WATER RATES, RULES AND REGULATIONS: Mr. Murdoch stated that although the City Attorney's Office is not ready with wording changes for amendments to Rule No. 15, discussion of those points not previously covered would be appropriate in light of the fact that the special facilities districts as set up under this rule represent an entirely new concept to the City, which concept does not follow the recommendations made by the 1968 Citizens Committee on Public Utilities. He reminded the Council that at the time Rule No. 15 was adopted there was some degree of urgency relative to increase in water con- nection rates and it was understood at that time that some amendments would be necessary. 3-14 it~ Hall~ Anaheim; California - COUNCIL MINUTES - January 9~ 1973~ 1:30 P.M. Mr. Murdoch reported the new special districts policy has merit and is being one used by many cities. To provide water service to the higher ele- vations in hill and canyon areas, Mr. Murdoch explained that the existing water system would require a series of booster pumps and small reservoirs. The pur- pose of these reservoirs would be primarily to insure a more dependable fire flow and more reliable pressure regulation in the upper elevations. The booster pumps are required to move water from the elevations presently served on the existing system to those which are higher. Mr. Murdoch advised that at the time Rule No. 15 was drafted it was staff's opinion that the special facilities district approach was appropriate in that service of water in higher elevations is more expensive due to the additional facilities which would have to be constructed. However, taking an overall view of the City's water system and previous practices, he felt that there are some inconsistencies between City policy and what is proposed under Rule No. 15. He pointed out that all of the reservoirs existing in the present system, all of the pumps, pressure regulating valves, i.e., have been built as an obligation of the water system. Rule No. 15 requires that special facilities at higher elevations be financed by the developer, and although this is a justifiable situation, it is a deviation from past City policy. Further, Mr. Murdoch stated if this principle is applied, i.e., that the cost of special facilities will not be borne by the water system, how then can the installation of pressure regulating devices to seperate the various pres- sure zones throughout the City be rationalized, since these devices were pur- chased as a water system cost and amortization is through water rates. Similarly, the City now proposes to install additional wells and a reservoir on the western side of the City. It is not intended to drill the wells as a responsibility of a lesser district~ but that it would be a system-wide responsibility. Mr. Murdoch concluded by saying he wished to bring these points to Council's atten- tion, as it was staff's feeling that prior to implementation of this policy, it should be further reviewed by the Council. Mr. Hoyt prefaced his presentation with the statement that the Utility Division based their recommendation of the proposal under Rule No. 15 on the belief that this is the best method of handling the additional expense incurred as a result of adding the hill and canyon areas to the City Water System. Using a map depicting the various pressure zones and topographical elevations through- out the City, Mr. Hoyt briefly outlined the methods and facilities presently in use to provide water service. He described the City's total reservoir storage capacity as about one billion gallons with storage facilities located at La Palma, Linda Vista, Olive Hills, Walnut Canyon, and indicated on the map the various locations of pressure regulating devices used to maintain a constant pressure throughout the system in each of the zones at 50 to 70 pounds. The City obtains water both by pumping from the underground basin and by purchase from the Metropolitan Water District. Comparative costs reveal that it is more economical for the City to pump water, however most of this pumping occurs in the westerly portion of the City, and as areas to the east come into the City, these areas are serviced with Metropolitan Water District water. The City water policy is to treat the entire City alike as to water charges, there- fore, costs of water obtained from the Metropolitan Water District and from pumping are averaged and the rate for water established, and all of the consumers are charged accordingly. In describing the background for formation of the special facilities districts, Mr. Moyt related the following information: Walnut Canyon Reservoir was installed at a time when severe water short- age was anticipated. This is a high-level reservoir and holds clear, filtered water which is available to flow by gravity into some sections of the canyon area as well as into all parts of the City. This reservoir provides the City with an emergency water supply from a high elevation which proves to be an excellent back-up system. The Olive Hills, La Palma and Linda Vista ReServoirs also pro- vides such water storage for emergencies. In addition, in the event of a total power failure, it would be difficult to maintain water pressure without 73-15 City Hallt Anaheimt California - COUNCIL MINUTES - January 9~ 1973~ 1:30 P.Mo these elevated reservoirs and the ability to fight fires might be lost. For these reasons, the storage reservoirs are considered not as special fa- cilities to serve one area, but as special facilities which are necessary to keep pressure in the entire main system. Following this line of thinking, the pressure regulators installed along the boundaries of each pressure zone are also considered part of the overall water system expense in all areas of the City, both the low elevations and the high elevations. Mr. Hoyt maintained that the special facilities approach came about as a result of the topography of the area which is being developed, which makes it necessary to pump water uphill, place it in storage tanks, and retain it for fire flow storage in the different pressure zones, setting up a situation whereby each pressure zone is similar to a completely self-contained water system. It was considered that if the ground surface was level,these pumps and storage would not be required as they do not serve the system as a whole,but these are necessary to serve a given pressure zone area because of the topo- graphy. Mr. Hoyt further related that the special facilities district charge is arrived at by computing the costs of the special facilities required to serve the zone and dividing this sum among the number of acres served by the district. Mr. Hoyt observed that the smaller the district, the higher this charge will be, and that, as developers build even further east into the can- yons, these costs are likely to be higher because of the relative paucity of buildable land. He described the costs for the different zones, as indicated by colors on the map, and the facilities required to serve them. In all instances, the developer will additionally be responsible for the secondary distribution system and the $275.00 charge for primary mains which is constant. The philosophy behind the special facilities charge was that this reflects a cost associated with development rather than an improvement which would benefit all of the consumers on the system. Mr. Hoyt also referred to the problems which are inherent to develop- ment in the hill and canyon areas, which does not always proceed in the order which would be best for the water utility, thus making it difficult to evaluate what the eventual cost to the developer for the permanent special facilities will be. Councilman Pebley inquired whether Rule No. 15 requires the City to install these special facilities at City expense, and then the developer to reimburse the City by paying a fixed amount per acre. Mr. Hoyt explained, using one district as shown on the pressure zone map as an example, that the developer will pay the special facilities charge, and if there are no facilities at all in that pressure zone, he will addition- ally be required to install the booster pump station, which will have to meet all environmental specifications including appropriate noise attenuation mea- sures and outside appearance. As the rest of the pressure zone is developed, the original builder will be reimbursed over a 20-year period for the cost advanced for additional special facilities. The water systemsaxpense will be limited to transmission lines, production pumps, storage reservoirs and pres- sure reduction stations. Councilman Dutton related that in the past, special facilities in the water system were constructed with general funds and revenue bonds and specifi- cally mentioned the City's reservoirs. He asked why the approach is different in this instance. Mr. Hoyt reiterated that the reservoirs serve all sections of the City as a water supply and storage source~ whereas the section under discussion is above the City's present high water level and therefore requires special~ facilities because of the topography, which otherwise would not be installed and which do not serve any other part of the City. Councilman Dutton expressed concern regarding the City's previous agreement with Mr. Louis E. Nohl that his property receive the same treatment as the rest of the City. Mr. Hoyt stated that the Nohl property is receiving the same treatment as all other property being developed at that ~3-16 :it~ Hall; Anaheimt California - COUNCIL MINUTES - January 9; 1973t 1530 P.M. elevation. Further, he advised that they have found through surveys of many cities, that this special facilities method is an industry practice where eleva- tion problems exist, and their recommendation was patterned after the approach used by the Cities of Los Angeles and Burbank. Councilman Stephenson felt the policy could be described as one which does not require those residents living on the flat or level areas of the city to pay for the development of a water system in the higher elevations which is more costly. Mr. Hoyt answered that this was their basic philosophy; the difference in cost of serving water~ once the system is installed, will be minimal, and therefore this difference will be absorbed by the entire system, and the same rates charged to all customers. However, this will be monitored and if the cost differential becomes significant, then a change in policy and rates will be recommended by the water utility. Councilman Sneegas stated that he always assumed that when building a home in a higher elevation, the cost of water service as well as other utilities would be higher, and never considered that the remainder of citizens would con- tribute towards this expense. Mr. Murdoch advised that at the time Rule No. 15 was formulated the possibility of setting up different rate zones was analyzed, whereby the capital cost of water service would not be borne by the water system. It was found that the differential costs would not be sufficient to require these additional rates. However, if the special facilities are amortized through the rates, then varying rates would be necessary 6ecause of the higher cost of the water system. Mr. William Stark, President, Anaheim Hills Inc., indicated that the water from Walnut Canyon Reservoir will serve only 25% of the Nohl Ranch property presently held by his company. He remarked that special facilities will mean to Anaheim Hills, in terms of dollars, that the cost of water service will be six times as much as on any other part of the system. Mr. Stark stated that in planning the development of the Nohl Ranch property, the water supply as well as the agreements between the City and Mr. Nohl were reviewed. It is their position that the terms of the Nohl agreements of 1957 and 1964 would permit them to build a water system, and he thereupon proposed that Anaheim Hills Inc, build the entire water system, at no cost to the City and stated that once the system is built, if the City elects to purchase it, the terms would be negotiated. In support of his proposal, Mr. Stark stated that under Rule No. 15 the homeowners in Anaheim Hills will be paying for the entire cost of their water system as well as retiring existing City bonds. The master planning of the water system design has been completed by his company he reported, an approx- imately $300,000.00 in physical water facilities have been paid for and installed. He suggested that the structure of water payments could be s~ch that there may be a differential in cost to Anaheim Hills consumers to recover the initial investment. He contended that under Rule No. 15, since it applied only to Anaheim Hills, his company is being treated differently from any other developer and that some portion of this water system expense should be the City's responsibility. Additionally, he noted that if this property were in Fullerton or Yorba Linda, the water system cost would be one-third of what is proposed by the City under Rule No. 15. Mr. Stark ramarked that his company finds itself at a competitive disadvantage under this treatment~ and therefore would like to take the option they feel is allowed them under the Nohl agreements and construct the water system. Councilman Dutton noted that it would be a difficult and lengthy pro- cedure for Anaheim Hills to attempt to go before the Public Utilities Commission for permission to form its own water district. In response to Councilman Pebley's request for clarification of the Nohl agreeements, Mr. Geisler advised that this agreement does give the Nohl property owners the power to entend the mains at their own cost, if the City does not have the money to do'so, and at such time as these may be integrated into the City system, the City may purchase them. However, the City would operate the 73-17 City Hall; Anaheim~ California - COUNCIL MINUTES - January 9~ 1973~ 1:30 P.M. system and sell to the customers at all times. He noted that at the time of the agreement, Mr. Nohl had a large cattle operation and did have major lines to serve the cattle, and did have the right to use these facilities for his own purpose. However, the agreement is very specific in that the Nohl property owners may not resell the water at any time. He further noted that the agree- ment does specify that the City has the option to buy at a depreciated cost, however it is possible under the agreement that the City could operate and sell water via the system without ever purchasing it. Mr. Stark felt the important issue was the intent of the agreement and that was if the City was not in position to install the lines, they could, and the City would buy them back. He contended that Anaheim Hills Inc. does not wish to be subsidized, however, when the City refused to accept $42,000.00 in water fees (at $155.00 per acre) six months ago, this constituted an ad- mission that the City was not able to build the system. As Rule No. 15 stands now, he noted that Anaheim Hills would still be obligated to pay for the entire water system but would have no control over the time of construction and design restrictions which would be imposed by the City. Councilman Dutton asked whether there has been any discussion along the lines of Mr. Stark's proposal. Mr. Murdoch replied in the affirmative as to discussion, but that he could not make any recommendation at this time because the interpretation of the Grant Corporation - Anaheim Hills Inc. of this agreement is not the same as that of the City. The disagreement lies in the assumption on their part that if they construct and operate the water system, they will have the ability to amortize the investment. The only way this can be done, other than putting the entire cost into the price of the homes, is to operate the water system, which the City feels they are prohibited from doing by the terms of the Nohl agreements and secondarily because they are not recognized as a public utility by the Public Utilities Commission. Councilman Dutton asked whether discussion has been held regarding a method of amortization of such an investment by Anaheim Hills Inc. Mr. Murdoch stated that a specific proposal has been received along these lines from Anaheim Hills~ which is similar to the kind of method used by private water systems under Public Utilities Commission's rules and provides for a portion of the revenue obtained from the rates to be applied to a back payment for the system. He advised that this approach has not been discarded but pointed out that this is in conflict with Rule No. 15, which has been adopted as policy by the City, and further that there are the two Nohl agree- ments to consider, which were drawn up to carry out the policies of the City existing at that time and provides for compliance with the existing policies at the time of implementation and if the policies have changed since 1957, the new policies would apply. He advised that these are some of the reasons he felt Council discussion and further consideration of this matter was compulsory. Regarding the City's investment in the water system, Mr. Hoyt sub- mitted the following information: Aside from the production, transmission and major storage facilities, the City's investment is zero. In all cases the secondary systems are installed by the developer and the primary distribution systems are installed at the expense of the City but amortized by revenues from acreage fees paid by the developers. The rate-payers pay for the reservoirs and the transmission lines~ which make it possible to develop the Nohl Ranch property, and this is a substantial investment. The City as a whole has a substantial investment in the hill and canyon area, in the Walnut Canyon Reser- voir, the Lenain Filtration Plant and the main system. He compared the special facilities in Anaheim Hills with the primary and secondary distribution systems and stated that all of these are supported by the property developer, and this is the theory on which the water rates are predicated. Mr. Stark reiterated that if Rule No. 15 applies, his firm will be required to pay not only for the development of the Nohl Ranch property, but additionally to provide the capacity to serve approximately 16 million gallons per day off of their property, and this he feels is not equitable. He repeated that the City should bear part of the cost for future expansion. 73-18 SitS Hall; Anaheim~ California - COUNCIL MINUTES - January 9~ 1973~ 1:30 P.M. Mr. Hoyt stated there is a difference in interpretation of the methods of reimbursement of excess mains costs, and the City's position is they will pay the incremental difference between the costs of those facilities required on Mr. Stark's property and that which the City deems necessary for future expan- sion, i.e., if the Nohl Ranch property requires a 12-inch main, and City plans call for a 14-inch main~ the City will pay the difference in cost between the 12 and 14-inch main; the developer continues to pay for the 12-inch main. Where- as, Mr. Stark feels that reimbursement should be on a capacity basis, whereby if his property uses one-hundred gallons of water per day~ and the additional capacity being installed for expansion will provide another hundred gallons, then the City and the developer should split the costs of installing the facil- ities 50-50. He again advised that the design of the facility is for fire flow and not capacity and the acreage cost spreads the cost over the entire area. Councilman Sneegas felt the method for development as proposed by the City under Rule No. 15 would be more economical as far as Anaheim Hills Inc. is concerned, since costs are divided on an acreage basis and provides for remun- eration to the original developer for whatever monies he has invested. Mr. Stark pointed out that this might be correct if reimbursement is immediately forthcoming, however if his'firm has to wait 20 years to recover their investment, they would not consider this a favorable monetary situation. Councilman Sneegas observed that this is one of the potential risks of development. Mr. Hoyt concurred and stated that the City is attempting in Rule No. 15, to minimize the water system investment in an oversize facility. In conclusion Mr. Stark was of the opinion that special facilities, as defined under Rule No. 15, applies only to Anaheim Hills and means, in effect, that the City is not providing water facilities in that area on the same basis as other areas of the City. If Rule No. 15 applies, he urged the Council to consider his proposal and permit Anaheim Hills to construct the water system independently, or that they renegotiate and determine what special facilities are because they strongly feel the City should bear part of the financial respon- sibility for the water system. Councilman Sneegas stated he was concerned that when building this system it be large enough to accommodate expected future expansion, so that al- terations or rebuilding of the system in the future will not be required. In answer to this, both Mr. Stark and Mr. Hoyt felt there was no dif- ference of opinion in this area and assured the Council that the proposed water system will be adequate to meet the City's expansion needs. At the conclusion of the discussion, and at the suggestion of Councilman Pebley by general Council consent a committee comprised of Councilman Sneegas, Councilman Dutton, Mr. Murdoch, Mr. Stark and Mr. Hoyt was appointed to consider the proposal presented by Mr. Stark and the regulations and ramifications of Rule No. 15, in an effort to bring about a solution to the problem acceptable to all parties. gCESS: Councilman Pebley moved for a five-minute recess. Councilman Dutton seconded the motion. MOTION CARRIED. (3:25 PoM.) ?TER RECESS: Mayor Dutton called the meeting to order, all Councilmen being present. (3:40 P.M.) ~TROPOLITAN WATER DISTRICT; Mr. Murdoch stated that at the last Metropolitan Water District Board meeting, it was reported that all reservoirs on the system con- tained more water this year compared to the water level at this time last year. Additionally, he reported that the Metropolitan Water System will not provide service for approximately ten days beginning January 20, 1973~ as it will be closed down for repairs and the City will draw water from its own reservoir system during this period. 73-19 City Hall, Anaheim~ California .- COUNCIL MINUTES - January 9~ 1973~ 1:30 P.Mo ANAHEIM CHAMBER OF COMMERCE - ACCREDITATION UNITED STATES CHAMBER OF COMMERCE: Mr. Murdoch advised that suggestions have been received concerning the Anahe~,~ Chamber of Commerce accreditation, urging that the City sponsor some type of appropriate recognition. Councilman Thom moved that the City Council sponsor a no-host cel- ebration to commemorate the accreditation of the Anaheim Chamber of CommerCe by the United States Char~ber of Commerce, suggested date being February 9 or February 16, 1973. Councilman Sneegas seconded the motion. MOTION CARRIED° By general Council consent, Mayor Dutton was designated the Chairman of the event. ADJOURNMENT: Councilman Pebley moved to adjourn. Councilman Thom seconded the motion. MOTION CARRIED. Adjourned: 3:45 P.M. City Clerk