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Page 2 of 3 <br />improvements, consistent with the Water Rate Study allowance of approximately $29 million in <br />2026 dollars. <br /> <br />Table 1. Capital Cost Estimate – City Share <br />Feasibility Studies1 $1.5 million <br />Regional Groundwater Development with Zone 73 $15.2 million <br />City Groundwater Distribution Improvements4 $12.3 million <br />Total $29.0 million <br />Notes: <br />1. The City received a $1 million State Water Board grant for feasibility studies. <br />3. Represents the City’s cost share per the City-Zone 7 agreement. <br />4. Represents improvements funded solely by the City. <br /> <br />DISCUSSION <br />The Project includes new groundwater production wells at Tennis Park and Hansen Park, raw <br />groundwater pipelines connecting the wells to Zone 7's Hopyard Chloramination Facility, and <br />improvements to the Hopyard Chloramination Facility. <br /> <br />As the lead agency, Zone 7 is responsible for environmental review, permitting, procurement, <br />design and construction, and contract administration. The Project will be delivered using the <br />PDB method, which allows the design team and contractor to collaborate during design <br />development and establish a guaranteed maximum price before construction. <br /> <br />The Zone 7 Board authorized negotiation and execution of a contract with LSCE for Phase II <br />preliminary design and owner's representative services to support PDB procurement. Staff <br />reviewed Zone 7’s not-to exceed estimate and determined that the City’s share of $810,000, is <br />appropriate. <br /> <br />While Zone 7, as the lead agency, retains authority over technical and operational decisions <br />affecting the groundwater system, the agreement requires coordination with the City on Project <br />features affecting City property, including facility aesthetics, location, and noise. <br /> <br />This is the first funding authorization under the Zone 7 and City agreement. A subsequent <br />funding authorization for the City’s share of the PDB contract is anticipated to return to the City <br />Council near the end of calendar year 2027. <br /> <br /> EQUITY AND SUSTAINABILITY <br /> This project will strengthen the community’s water resources in response to a changing <br />climate, resulting in cost savings, enhanced water quality and availability, improved <br />infrastructure, and increased resiliency. <br /> <br />OUTREACH <br />The Project has included City-led community engagement efforts, including a project website, <br />community engagement events, and notifications regarding exploratory drilling activities. <br />Page 129 of 318