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ITEM: |
CONSENT CALENDAR |
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3. |
CONSIDER AUTHORIZATION OF BUDGETED
FUNDS FOR FINANCIAL SERVICES CONSULTING FOR THIRD PHASE OF WORK ON PROPOSED
LEGISLATION RE PUBLIC FINANCING OF A WATER SUPPLY PROJECT IN CPUC APPLICATION
A.12-04-019 |
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Meeting Date: |
May 20, 2013 |
Budgeted: |
Yes |
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From: |
David J. Stoldt General Manager |
Program/ |
Other Water Supply Projects
– Desal |
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Line Item No.: |
1-8-1 |
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Prepared By: |
David J. Stoldt |
Cost Estimate: |
$20,000 (FY2013) |
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General Counsel Approval: N/A |
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Committee Recommendation: At its April 24, 2013 meeting the Legislative Advocacy Committee voted 3-0 to recommend approval of funding additional bond counsel services related to legislation. At its May 13, 2013 meeting, the Administrative Committee voted 2 to 0 to recommend approval of funding additional bond counsel services related to legislation. |
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CEQA Compliance: N/A |
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SUMMARY: At its January 14, 2013 Special Meeting, the Board authorized the hiring of Sidley Austin to provide documentation in support of expert testimony by the District and the Mayors’ Authority October 2012 “Public Agency Participation Proposals” to California American Water (Cal-Am) as part of the CPUC proceeding A.12-04-019 and the Governance Concepts and Capital Financing Alternatives included in testimony submitted on February 22, 2013.
The District’s testimony under cross-examination April 10th and 11th, 2013 reinforced the viability of a public contribution of funds and focused in on a financing mechanism called “securitization” whereby a non-bypassable surcharge would be collected on Cal-Am bills and dedicated to the repayment of Ratepayer Relief Bonds. Such a financing structure would significantly reduce the cost of the desalination project to ratepayers. The structure is further described in Exhibit 16-A of this packet. The structure requires legislation to be passed. In order to draft and finalize proposed legislation, the District desires to expand the contract of Sidley Austin.
RECOMMENDATION: The Legislative Advocacy Committee and the Administrative Committee recommend that the Board of Directors approve additional services from Sidley Austin not to exceed $20,000. The bond counsel services cost would be borne solely by the District.
BACKGROUND: The District has made several proposals with respect to financing the Cal-Am desalination facility. Sidley Austin has been advisor to the District on bond counsel matters since the 1992 Reclamation Project financing.
EXHIBIT
None
U:\staff\Boardpacket\2013\20130520\ConsentCalendar\03\item3.docx