Common use of Plant F59 Clause in Contracts

Plant F59. ISSUE: San Xxxxxxx proposed to acquire land, perform grading and construct a treatment facility, fence and wall at Plant F59 in order to treat water from the Grapeland Tunnel at a requested budget of $2,500,000. DRA recommended the project be disallowed in its entirety for the following reasons: the potential for legal actions from water agencies that currently receive water from the Grapeland Tunnel; an incomplete assessment of the project’s costs and benefits; and a lack of information relevant to whether San Xxxxxxx will pursue compensation from third party(ies), if any, responsible for the well-water contamination. RESOLUTION: DRA approves a $700,000 budget for land that was purchased in 2011. The land will be treated as plant held for future use and San Xxxxxxx will address its plan for this property in the next GRC. As part of its request to proceed with this project in the next GRC, San Gabriel agrees to address DRA’s concerns related to viability and costs of this project as stated in DRA’s November 2011 report (pages 7-32 to 7-33). Specifically, San Xxxxxxx will: • address the risk of legal actions from agencies that might claim loss of current access to the water supply in question; • provide a comprehensive cost-benefit assessment of the proposed plan which will include cost savings calculations; and • report on efforts to identify party(ies) responsible for contamination leading to loss of water supply relevant to the need for this project. Issue SGV Direct SGV Rebuttal DRA Report Difference Settlement Plant F59 (2011) $2,500,000 $2,500,000 $0 $2,500,000 $700,000 REFERENCES: Exhibit SG-12 (Xxxxxxx), pp. 26-27 and Attachment C, Section Plant F59; Exhibit DRA-1 (Xxxxx), pp. 7-31 to 7-33; Exhibit SG-25 (Yucelen), pp. 28- 29.