ITEM:            ACTION ITEMS                              




Meeting Date:           August 28, 2003                     MPWMD Budget:  $125,000 for EIR


Staff Contact:             Henrietta Stern                      Cost Estimate: $255,500 total proposal


General Counsel Approval: has not reviewed staff note


Committee Recommendations: The Administrative Committee and Water Demand Committee reviewed this item on August 12 and August 21, 2003, respectively.  The committees concurred that the full Board should address this issue.  Committee members individually suggested reference checks and further review of the contract by Special Counsel before finalization. 


CEQA Compliance: Not applicable for retention of consultant


SUMMARY:   The Board will consider retaining the firm of Resource Design Technology, Inc. (RDT) of Folsom, California, to prepare an Environmental Impact Report (EIR) on the termination of the Water Credit Transfer Program (WCTP).   RDT was the only firm to submit a proposal to prepare an EIR in response to a Request for Proposals (RFP) that was sent to 18 firms, including a 30-day extension to the original deadline to August 6, 2003.  The full RDT Proposal was reviewed by the Administrative and Water Demand Committees at their respective August 12 and August 21, 2003 meetings, and was also reviewed by Special Counsel.  Significant portions of the RDT Proposal were provided to all Board members as part of the Administrative Committee packet.  The bound complete proposal is available at the District office for public review.


The RDT proposal originally estimated a total cost of $261,820, which has been reduced to an estimate of $255,500 upon further discussion (Exhibit 5-A).  The proposed EIR costs are more than double the estimated MPWMD budget of $125,000.  RDT emphasizes that they “do not feel [they] can produce a robust, legally defensible document in the [District] price range due to the unusual nature of the proposed action as well as the legal issues involved.”  It is notable that several firms who declined to propose indicated that the District’s budget estimate was too low.


The RDT proposal estimates a total of 36 weeks (roughly nine months) from the Notice of Preparation to completion of the Final EIR, preparation of CEQA Findings and hearings.  This time frame is within the estimated schedule in the RFP.


The EIR includes project level evaluation of the proposed project to terminate the WCTP, and evaluation of two alternatives at a lesser level of detail.  The alternatives include: (1) Rule 28-B is reinstated (No Project alternative pursuant to Ordinances No. 107 and 108); and (2) enact amended water credit transfer program as described in Ordinance 101.


RECOMMENDATION:  Staff recommends that the Board take the following actions:


  1. Authorize staff to retain Resource Design Technology, Inc., to prepare a Draft and Final EIR on the termination of the Water Credit Transfer Program.  However, the Board should approve funding only for “Phase I” at this time, which comprises Tasks 1, 2 and 3 shown in the attached revised spreadsheet dated August 21, 2003 (Exhibit 5-A).   The not-to-exceed amount should be set at $60,300 with invoices to be submitted on a time and materials basis.  Once Phase I is completed, the Board will consider a contract amendment for Phase II (prepare Draft EIR).   Once Phase II is completed, the Board will consider a contract amendment for Phase III (prepare Final EIR).  This series of contract phases is similar to the procedure currently in place for the Water Supply Project EIR.


  1. Direct staff to request Special Counsel review of the contract language, scope of work, cost estimate and work schedule before finalizing the contract with RDT.  If there are any substantive changes needing Board policy direction, the Board should designate the Administrative Committee to provide oversight and final approval.


DISCUSSION:  District staff, Special Counsel and the Administrative and Water Demand Committees have reviewed the RDT proposal.  To address concerns expressed by committee members about the accuracy of the cost estimates, yet still demonstrate forward progress on the EIR, staff recommends that a phased approach be used, similar to the Water Supply Project EIR.  The three Phases are as follows:


Phase I:  Proposal Tasks 1-3

Phase I entails preparing a detailed outline of the EIR as well as the detailed work tasks and costs to prepare the document.  Some topics will require more effort than others, based on the public comments received on the Notice of Preparation, to be summarized in a Scoping Report, as well as the results of the Data Adequacy Report described in Task 3.  Once Phase I is completed, a better estimate of the costs to prepare the Draft EIR in Phase II can be made.  The cost estimate for Phase I is $60,300 (cost estimate excludes $6,320 previously tabulated to prepare an Initial Study); the estimated time line for Phase I is 11 weeks.  Exhibit 5-A provides the spreadsheet of the Proposal cost estimate reformatted into three phases.


Phase II:  Proposal Tasks 4-7

Phase II entails preparing the Draft EIR for 45-day circulation, holding public hearings to receive comments and summarizing those comments so that a work plan for a Final EIR can be prepared for Board consideration.  The current cost estimate for Phase II is $128,620 based on the August 2003 Proposal; the estimated time line for Phase II is 17 weeks.  These cost and time estimates could change based on the results of Phase I.


Phase III:  Proposal Tasks 8 and 9

Phase III entails completing the Final EIR, responses to comments, and certification findings in close coordination with Special Counsel.  The cost estimate for Phase III is $66,580 based on the August 2003 Proposal; the estimated time line for Phase III is eight weeks.   These cost and time estimates could change based on the results of Phase II.


Note that Proposal Task 10 (meetings and phone) has been disaggregated into the three Phases in Exhibit 5-A.  Thus, cost estimates for each task may not match those found in Table 7-1 of the August 6, 2003 RDT Proposal. 


BACKGROUND:  At its February 27, 2003 meeting, the Board directed staff to work with a sole source consultant to develop a scope of work for a focused EIR on the environmental impacts of having or not having a water credit transfer program.  The stated goal at that time was completion of the Final EIR no later than September 30, 2003.  The Board also directed that all applications for water credit transfer approval shall not be considered by the Board until after the EIR is certified.


At its March 17, 2003 meeting, the Board determined that Turnstone Consultants of San Francisco should be retained to prepare an EIR that evaluates the environmental effects associated with a water credit transfer program.  The Board further directed that Directors Henson and Lindstrom should negotiate with Turnstone to refine the scope of work, and address Board concerns about the high cost and extensive reliance on staff work products.


A revised Turnstone scope of work was prepared for the April 21, 2003 Board meeting, but this item was continued until the May 19, 2003 meeting.  A significant addition was to include an economic analysis in the scope to address certain concerns raised by litigants.  Considerable information also remained to be provided by staff.  The cost estimate for Turnstone to produce only a Draft EIR was $155,400; this amount included an estimated $42,200 for a specialist to perform an economic analysis.  Negotiations between MPWMD and Turnstone representatives continued in mid-April, but it became evident that a mutually satisfactory result was not forthcoming. 


District staff was directed in late April 2003 to prepare an RFP to be transmitted to a variety of environmental consulting firms for an EIR that will focus on termination of the existing WCTP.   The overall goals of the EIR are to assess environmental effects associated with terminating the WCTP, and respond to assertions by litigants who challenged Ordinance No. 102 rescinding the WCTP.  The emphasis on terminating the WCTP is at the direction of District Special Counsel, Clement Shute.  He directed that the EIR should respond to litigant assertions that terminating the WCTP would result in direct and indirect adverse physical effects.


District adoption of Ordinance Nos. 107 and 108 in May 2003 also affects the EIR.  Ordinance No. 107 reinstates the water credit transfer program (Rule 28-B).  Ordinance No. 108 clarifies some of the processes and vague terminology contained in Rule 28-B.  Specifically, decisions about water credit transfers shall be made by the MPWMD Board of Directors and are considered to be discretionary decisions subject to CEQA. 


On May 19, 2003, the Board approved the RFP drafted by staff with review by the Water Demand Committee, and directed that it be transmitted to the list of 18 non-local consulting firms.  The RFP was transmitted electronically on May 21 with a deadline of July 1, 2003.  The intent was for staff to review proposals and make a recommendation for consideration by the Administrative Committee on July 15 and the full Board on July 21, 2003.  No proposals were submitted by July 1.


Staff and Director Lindstrom contacted the consulting firms to learn why they chose not to submit a proposal.  A variety of reasons for not proposing were given and suggestions were made to enhance consultant responses in the future.  A few firms expressed interest in submitting a proposal if the RFP deadline was extended into early August 2003.  These firms specialize in the more conceptual planning-type of EIR, rather than the standard structural project EIR, such as a shopping center. Importantly, several firms indicated that the RFP budget and timeline were not realistic due to the legal issues involved and political complexity.


The Board was apprised of the status of the EIR effort in a July 11, 2003 memorandum transmitted by the Acting General Manager.  She directed staff to extend the deadline for the RFP to August 6, 2003.  Because several firms indicated that the RFP budget is too low and the time line is too short, staff asked the firms to propose a budget and time line with a specific rationale of why they believe their proposed amounts are reasonable.   Despite interest expressed by various forms, only RDT submitted a proposal by the extended August 6, 2003 deadline. 


IMPACTS ON RESOURCES:  A total of $150,000 is budgeted for the Water Credit Transfer Program in fiscal year (FY) 2003-2004, including $125,000 for the EIR and $25,000 for legal services by Special Counsel.  The proposed cost estimate for the EIR currently totals $255,500 based on assumptions in the August 6, 2003 RDT Proposal.  However, if the Board concurs with the staff recommendation, only $60,300 will be approved at this time, which is within the FY 2003-2004 limit.  Once Phase I is completed, the Board will consider a contract amendment with more accurate cost estimates for Phase II, Prepare Draft EIR.  Regardless of cost, the EIR relies on staff assistance and reports; it is anticipated that extensive staff time, primarily from the Water Demand Division, will still be needed to help initiate the project and respond to consultant questions. 




Revised Aug 22, 2003