Common use of UTILITY PLANT ADDITIONS Clause in Contracts

UTILITY PLANT ADDITIONS. In its Application, San Xxxxxxx proposed a capital projects budget totaling investments of $70,650,000. DRA’s Report proposed substantial deferrals and disallowances resulting in a total proposed capital budget of $39,500,000. In the Settlement Agreement, San Gabriel agrees not to pursue certain projects and to defer others, resulting in a total capital budget of $48,793,000. The City accepted the resolution of many, but not all, of the proposed project investments. Capital investment forecasts and settlement amounts for 2011-2014 are as shown in Table 1 below, followed by descriptions, by line item, of the positions of the parties and the resolution of contested items. The annual amounts and the 4-year budget totals are the amounts agreed upon by DRA and San Xxxxxxx. TABLE 1 ($1,000) Item No. Plant 2011-2014 Capital Budget Before Settlement 2011 2012 2013 2014 2011-2014 SGVW DRA Diff. Settlement Settlement Settlement Settlement Settlement 1 Plant F10 55 0 55 55 55 2 Plant F13 105 105 0 105 105 3 Plant F14 265 140 125 90 50 125 265 4 Plant F15 6,970 0 6,970 4,650 4,650 5 Plant F16 1,585 0 1,585 1,585 1,585 6 Plant F20 2,650 0 2,650 300 300 7 Plant F21* 3,235 3,235 0 85 2,760 390 3,235 8 Plant F23 3,435 2,600 835 1,985 1,200 250 3,435 9 Plant F49 600 600 0 0 10 Plant F53 2,300 0 2,300 300 1,265 150 1,715 11 Plant F54 720 720 0 20 700 720 12 Plant F56 3,070 3,070 0 100 900 0 1,000 13 Plant F58 2,500 0 2,500 0 14 Plant F59 2,500 0 2,500 700 700 15 GIS 1,155 900 255 0 000 000 000 1,155 16 Miscellaneous 2,165 1,735 430 537 412 438 438 1,825 17 Mains 22,890 16,520 6,370 4,275 4,760 5,410 2175 16,620 18 Services 6,400 5,400 1,000 1,350 1,350 1,350 1,350 5,400 19 Fire Services 0 0 0 0 20 Meters 4,800 2,720 2,080 50 940 978 892 2,860 21 Fire Hydrants 400 400 0 100 100 100 100 400 22 Office Equipment 295 185 110 50 65 65 65 245 23 Transportation Equipment 745 745 0 265 145 185 150 745 24 Communication Equipment 15 15 0 5 5 5 15 25 Tools and Equip. 410 410 0 175 130 55 50 410 26 Hydro Turbine Pilot * 1,385 0 1,385 1,353 1,353 Total 70,650 39,500 31,150 11,692 12,020 14,091 10,990 48,793 *Tier 3 Advice letter project.

UTILITY PLANT ADDITIONS. In its Application, San Xxxxxxx proposed a capital projects budget totaling investments of $70,650,000. DRA’s Report proposed substantial deferrals and disallowances resulting in a total proposed capital budget of $39,500,000. In the Settlement Agreement, San Gabriel Xxx Xxxxxxx agrees not to pursue certain projects and to defer others, resulting in a total capital budget of $48,793,000. The City accepted the resolution of many, but not all, of the proposed project investments. Capital investment forecasts and settlement amounts for 2011-2014 are as shown in Table 1 below, followed by descriptions, by line item, of the positions of the parties and the resolution of contested items. The annual amounts and the 4-year budget totals are the amounts agreed upon by DRA and San Xxxxxxx. TABLE 1 ($1,000) Item No. Plant 2011-2014 Capital Budget Before Settlement 2011 2012 2013 2014 2011-2014 SGVW DRA Diff. Settlement Settlement Settlement Settlement Settlement 1 Plant F10 55 0 55 55 55 2 Plant F13 105 105 0 105 105 3 Plant F14 265 140 125 90 50 125 265 4 Plant F15 6,970 0 6,970 4,650 4,650 5 Plant F16 1,585 0 1,585 1,585 1,585 6 Plant F20 2,650 0 2,650 300 300 7 Plant F21* 3,235 3,235 0 85 2,760 390 3,235 8 Plant F23 3,435 2,600 835 1,985 1,200 250 3,435 9 Plant F49 600 600 0 0 10 Plant F53 2,300 0 2,300 300 1,265 150 1,715 11 Plant F54 720 720 0 20 700 720 12 Plant F56 3,070 3,070 0 100 900 0 1,000 13 Plant F58 2,500 0 2,500 0 14 Plant F59 2,500 0 2,500 700 700 15 GIS 1,155 900 255 0 000 000 000 1,155 16 Miscellaneous 2,165 1,735 430 537 412 438 438 1,825 17 Mains 22,890 16,520 6,370 4,275 4,760 5,410 2175 16,620 18 Services 6,400 5,400 1,000 1,350 1,350 1,350 1,350 5,400 19 Fire Services 0 0 0 0 20 Meters 4,800 2,720 2,080 50 940 978 892 2,860 21 Fire Hydrants 400 400 0 100 100 100 100 400 22 Office Equipment 295 185 110 50 65 65 65 245 23 Transportation Equipment 745 745 0 265 145 185 150 745 24 Communication Equipment 15 15 0 5 5 5 15 25 Tools and Equip. 410 410 0 175 130 55 50 410 26 Hydro Turbine Pilot * 1,385 0 1,385 1,353 1,353 Total 70,650 39,500 31,150 11,692 12,020 14,091 10,990 48,793 *Tier 3 Advice letter project.

UTILITY PLANT ADDITIONS. In its Application, San Xxxxxxx proposed a capital projects budget totaling investments of $70,650,000. DRA’s Report proposed substantial deferrals and disallowances resulting in a total proposed capital budget of $39,500,000. In the Settlement Agreement, San Gabriel agrees not to pursue certain projects and to defer others, resulting in a total capital budget of $48,793,000. The City accepted the resolution of many, but not all, of the proposed project investments. Capital investment forecasts and settlement amounts for 2011-2014 are as shown in Table 1 below, followed by descriptions, by line item, of the positions of the parties and the resolution of contested items. The annual amounts and the 4-year budget totals are the amounts agreed upon by DRA and San Xxxxxxx. TABLE 1 ($1,000) Item No. Plant 2011-2014 Capital Budget Before Settlement 2011 2012 2013 2014 2011-2014 SGVW DRA Diff. Settlement Settlement Settlement Settlement Settlement 1 Plant F10 55 0 55 55 55 2 Plant F13 105 105 0 105 105 3 Plant F14 265 140 125 90 50 125 265 4 Plant F15 6,970 0 6,970 4,650 4,650 5 Plant F16 1,585 0 1,585 1,585 1,585 6 Plant F20 2,650 0 2,650 300 300 7 Plant F21* 3,235 3,235 0 85 2,760 390 3,235 8 Plant F23 3,435 2,600 835 1,985 1,200 250 3,435 9 Plant F49 600 600 0 0 10 Plant F53 2,300 0 2,300 300 1,265 150 1,715 11 Plant F54 720 720 0 20 700 720 12 Plant F56 3,070 3,070 0 100 900 0 1,000 13 Plant F58 2,500 0 2,500 0 14 Plant F59 2,500 0 2,500 700 700 15 GIS 1,155 900 255 0 000 000 000 1,155 16 Miscellaneous 2,165 1,735 430 537 412 438 438 1,825 17 Mains 22,890 16,520 6,370 4,275 4,760 5,410 2175 16,620 18 Services 6,400 5,400 1,000 1,350 1,350 1,350 1,350 5,400 19 Fire Services 0 0 0 0 20 Meters 4,800 2,720 2,080 50 940 978 892 2,860 21 Fire Hydrants 400 400 0 100 100 100 100 400 22 Office Equipment 295 185 110 50 65 65 65 245 23 Transportation Equipment 745 745 0 265 145 185 150 745 24 Communication Equipment 15 15 0 5 5 5 15 25 Tools and Equip. 410 410 0 175 130 55 50 410 26 Hydro Turbine Pilot * 1,385 0 1,385 1,353 1,353 Total 70,650 39,500 31,150 11,692 12,020 14,091 10,990 48,793 *Tier 3 Advice letter project. 1. Plant F10 ISSUES: San Xxxxxxx proposed to install a new booster flow meter and security camera at Plant F10 for a total requested cost of $55,000. DRA recommended disallowing this project on grounds that the flow meter cost should be recorded to San Gabriel’s Operation and Maintenance Costs for the F10 Treatment Facility memorandum account and recovered from the County of San Bernardino. XXX also recommended San Xxxxxxx purchase security cameras by securing Proposition 50 funds. RESOLUTION: XXX agrees to San Gabriel’s original request. The Parties agree to San Gabriel’s position regarding the booster flow meter because San Gabriel clarified that the new booster flow meter is not part of the operation of the treatment facility or treatment process at Plant F10 and therefore is not recoverable from the County of San Bernardino. The Parties further agree to San Gabriel’s position regarding the installation of a security camera because Proposition 50 funds are no longer available to fund the request. Issue SGV Direct SGV Rebuttal DRA Report Difference Settlement Plant F10 (2008-12) $55,000 $55,000 $0 $55,000 $55,000 REFERENCES: Exhibit SG-12 (Yucelen), Attachment B, Section Plant F10; Exhibit DRA-1 (Xxxxx), pp. 7-7 to 7-9; Exhibit SG-25 (Yucelen), pp. 4-5. 2. Plant F14 ISSUE: San Xxxxxxx requested a total of $265,000 for various improvements to the older facility at Plant F14, including, but not limited to, $125,000 to address drainage conditions and runoff impacting an adjacent private property. XXX agreed to a portion of San Gabriel’s original request, but recommended the aforementioned Fence/Wall/Drainage request be disallowed. RESOLUTION: XXX agrees to San Gabriel’s original request, including the Fence/Wall/Drainage project to divert flow and build a drainage system to resolve the issue impacting the adjacent private property, but moves the Fence/Wall/Drainage dollars from the 2012 capital budget to the 2014 capital budget as a compromise. Issue SGV Direct SGV Rebuttal DRA Report Difference Settlement Plant F14 (2011-2014) $265,000 $265,000 $140,000 $125,000 $265,000 REFERENCES: Exhibit SG-12 (Xxxxxxx), pp. 13-14 and Attachment B, Section Plant F14; Exhibit DRA-1 (Xxxxx), pp. 7-9 to 7-11; Exhibit SG-25 (Yucelen), pp. 6-7. 3. Plant F15 ISSUE: San Xxxxxxx requested a total of $6,970,000 to acquire land and to install a reservoir, booster station, emergency generator, SCADA system, and related equipment at Plant F15 to replace a 117-year old concrete water storage reservoir. DRA recommended the project be deferred or, alternatively, for San Xxxxxxx to rehabilitate the existing site instead of acquiring new land. RESOLUTION: DRA agrees to support the construction of a new 6.0 MG reservoir to replace the existing reservoir in this rate case cycle at the lower total cost of $4,650,000. San Xxxxxxx will begin construction in 2014. San Xxxxxxx agrees to construct the replacement tank at the existing site, which involves a land swap with Rosemead Properties (San Gabriel’s affiliate), in accordance with all Commission rules regarding such transactions. Issue SGV Direct SGV Rebuttal DRA Report Difference Settlement Plant F15 (2014) $6,970,000 $6,970,000 $0 $6,970,000 $4,650,000 REFERENCES: Exhibit SG-12 (Xxxxxxx), pp. 14-16 and Attachment B, Section Plant F15; Exhibit DRA-1 (Xxxxx), pp. 7-11 to 7-15; Exhibit SG-25 (Yucelen), pp. 7- 10. 4. Plant F16 ISSUE: San Xxxxxxx requested $1,585,000 to complete construction of a new booster station and related electrical equipment, fence and wall, site work and landscaping, and install a new SCADA system and emergency generator at Plant F16. XXX agreed with the construction of the Plant F16 project as it was authorized in San Gabriel’s last GRC. However, DRA opposed the budget request made in this GRC. RESOLUTION: XXX agrees to San Gabriel’s original request for $1,585,000 to complete this carry-over project, the expanded scope of which resulted from San Gabriel’s need to comply with City conditions and other permitting requirements not addressed in the prior GRC. The project is estimated to cost a total of $2,846,846 (the original budget amount) plus the $1,585,000 shown here and expended in 2011. Issue SGV Direct SGV Rebuttal DRA Report Difference Settlement Plant F16 (2011) $1,585,000 $1,585,000 $0 $1,585,000 $1,585,000 REFERENCES: Exhibit SG-12 (Xxxxxxx), pp. 16-17, 29-31, and Attachment B, Section Plant F16; Exhibit DRA-1 (Xxxxx), pp. 7-15 to 7-17; Exhibit SG-25 (Yucelen), pp. 10-14. 5. Plant F20 ISSUE: San Xxxxxxx planned to acquire land, construct a new water storage reservoir, piping, fencing and wall, and repaint the exterior of the existing water storage reservoir at Plant F20. DRA recommended total disallowance of the requested projects at Plant F20. RESOLUTION: DRA agrees to include an estimated $300,000 in 2012 for the purchase of land for a new reservoir. The land will be treated as plant held for future use and San Xxxxxxx will address its continued plan for this property in the next GRC. Issue SGV Direct SGV Rebuttal DRA Report Difference Settlement Plant F20 (2012) $2,650,000 $2,650,000 $0 $2,650,000 $300,000 REFERENCES: Exhibit SG-12 (Xxxxxxx), pp. 17-18 and Attachment B, Section Plant F20; Exhibit DRA-1 (Xxxxx), pp. 7-17 to 7-19; Exhibit SG-25 (Yucelen), pp. 14- 17.