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HomeMy WebLinkAboutEDB Cost Participation in SJRWMD BC WRD Amend 1 Final EXECUTIVE SUMMARY AGENDA ITEM: First Amendment to the Cost Participation Agreement No. 4 with the St. Johns River Water Management District (SJRWMD) for Construction and Operation and Maintenance of the Black Creek Water Resource Development Project Date: October 13, 2022 BACKGROUND: The SJRWMD requested the First Amendment to the Cost Participation Agreement No. 4 for the Black Creek Water Resource Development Project (Black Creek Project). The requested amendment would delay the second payment for CCUA's cost participation in the Black Creek Project from November 1, 2022, to the extended date of November 1, 2023. The SJRWMD indicated the reason for the request was due to the timing of the different phases of the project. By delaying the second payment, the SJRWMD will have bid all the phases of the project and thereby have actual costs reflected in the second payment. Staff along with our legal experts reviewed the SJRWMD's request and the proposed First Amendment to the Cost Participation Agreement No. 4 for the Black Creek Project. Staff sent a revised version of the proposed ° First Amendment to the SJRWMD for their review and consideration. Staff and our legal team focused on w maintaining CCUA's maximum cost exposure in the participating in the Black Creek Project. Staff attached the revised version to this executive summary for the Board of Supervisors consideration. Staff supports the extended date to November 1, 2023, proposed by the SJRWMD in the First Amendment. Staff's support of the extension of time centers on the ability to maintain the current project maximum cost exposure described in the cost participation agreement. REQUEST: Staff respectfully requests authorization for the Executive Director to execute a mutually agreeable First Amendment to the Cost Participation Agreement No. 4 with the SJRWMD for Construction and Operation and Maintenance of the Black Creek Water Resource Development Project. ATTACHMENTS: First Amendment to the Cost Participation Agreement No. 4 with the SJRWMD for Construction and Operation and Maintenance of the Black Creek Water Resource Development Project FIRST AMENDMENT TO COST PARTICIPATION AGREEMENT NO. 4 FOR CONSTRUCTION AND OPERATION AND MAINTENANCE OF THE BLACK CREEK WATER RESOURCE DEVELOPMENT PROJECT THIS AMENDMENT is entered into as of this day of October, 2022, by and between Clay County Utility Authority (CCUA), whose address is 3176 Old Jennings Road, Middleburg,FL 32068-3907,and the St. Johns River Water Management District, a special taxing district created by Chapter 373, Florida Statutes, (the District),whose address is 4049 Reid Street, Palatka, Florida 32177-2529. RECITALS A. On July 20, 2021, the District and CCUA entered into COST PARTICIPATION AGREEMENT NO. 4 FOR CONSTRUCTION AND OPERATION AND MAINTENANCE OF THE BLACK CREEK WATER RESOURCE DEVELOPMENT PROJECT (the Agreement). B. Among other things, the Agreement contemplates that CCUA would participate financially in the construction, operation, and maintenance of the Black Creek Water Resource Development Project (Black Creek WRD) and make payment in two parts. CCUA has already completed the first part of its payment, prior to the November 1, 2021, deadline, for construction, operation, and maintenance. The Agreement currently requires the second payment by "no later than November 1, 2022." However, the Agreement also contemplates that the District would first determine the final award for the construction bid for the Black Creek WRD, and based on that bid award,within 30 days thereafter,the District would notify CCUA of the final construction cost per 0.1 feet of lift and notify CCUA of the dollar amount of the remaining portion of the Black Creek WRD cost CCUA must pay the Escrow Agent. C. The District has been proceeding with the Project in three construction phases: (1) the pump station and intake structure at Black Creek, (2)the pipeline along State Roads 16 and 21, and (3) a treatment system/recharge location. At its July 2022 meeting, the Governing Board approved the Wharton-Smith bid of approximately $15.9 million for the construction of the first phase of the Project(the pump station and intake structure at Black Creek). At its September 2022 meeting, the Governing Board approved the DBE Management LLC bid of$38,813,100 for the second phase of the Project (construction of the pipeline). With the supplemental work and pipe escalation allowances, the awarded contract will have a total not-to-exceed amount of $41,313,100, which came in below the District's construction cost estimate for the second phase. D. Since the District still has one construction element left to bid, which will not be awarded until early 2023, and the second construction phase cost came in below the District's construction cost estimate, the District believes it would be in the best interests of both parties to delay the second payment for a year (until November 1, 2023), to allow the District to provide CCUA with a more precise cost per 0.1 foot of recovery purchased. The parties also believe it would be in their mutual best interest to delay until November 1, 2023, CCUA's second payment of$825,882 for the Black Creek WRD operation and maintenance costs. AGREEMENT NOW, THEREFORE, in consideration of the mutual benefits to be derived here from, the District and CCUA agree as provided herein. 1. The recitals set forth above are incorporated herein by reference and made a part hereof as fully as if set forth herein verbatim. Extension of Deadlines 2. Section 6 of the Agreement is amended such that within 30 days after determining the cost of the third construction phase of the Project (the final award for the construction bid of 2 the Black Creek WRD) and by no later than October 1, 2023, the District will notify CCUA of the final construction cost per 0.1 feet of lift and notify CCUA of the dollar amount of the remaining portion of the Black Creek WRD cost CCUA must pay the Escrow Agent. 3. Section 6 of the Agreement is amended such that by no later than November 1, 2023, CCUA will pay, deposit, and deliver, in escrow,to the Escrow Agent,the remaining amount of CCUA's construction cost payment. 4. Section 7 of the Agreement is amended such that by no later than November 1, 2023, CCUA will also pay to the escrow agent the remaining operation and maintenance payment amount of$825,882. 5. These time extensions are not intended to change any other substantive terms of the Agreement not explicitly identified herein, including those provisions regarding cost methodologies, or to reduce or diminish any of the benefits to CCUA of participating in the Agreement. In addition,these time extensions do not alter the provision of the Agreement limiting the maximum amount of CCUA's second construction cost payment to $2,806,556 regardless of the final construction cost bid award. 6. Nothing in this First Amendment changes the provisions described in sections 9 — 28 of the Agreement and the ability of CCUA to rely upon the same as provided in the Agreement. IN WITNESS WHEREOF,the parties have caused this Amendment to be executed on the dates set forth below. [SIGNATURES ON FOLLOWING PAGES] 3 CLAY COUNTY UTILITY AUTHORITY By: Jeremy D. Johnston,PE,MBA Executive Director Date of Execution: Approved as to form and content: By: Grady H. Williams, Jr., Esq. CCUA General Counsel to 4 ST. JOHNS RIVER WATER MANAGEMENT DISTRICT By: Michael A. Register, P.E. Executive Director Attest: Erin H. Preston Interim General Counsel (SEAL) Approved as to Legal Form and Content: Thomas I. Mayton, Jr., Deputy General Counsel FILED on this day of October, 2022. District Clerk 5