BEAVERTON CITY COUNCIL AND
TUALATIN VALLEY WATER DISTRICT BOARD
SPECIAL JOINT MEETING
JANUARY 29, 2007
         
CALL TO ORDER:

The Special Joint Meeting of the Beaverton City Council and the Tualatin Valley Water District Board of Commissioners was called to order by Mayor Rob Drake in the First Floor Conference Room of Beaverton City Hall, 4755 SW Griffith Drive, Beaverton, Oregon, on Monday, January 29, 2007, at 6:10 p.m.

INTRODUCTIONS:

Present from the City were:  Mayor Rob Drake; Couns. Catherine Arnold, Betty Bode, Bruce Dalrymple, Dennis Doyle and Cathy Stanton; Chief of Staff Linda Adlard; Public Works Director Gary Brentano; Finance Director Patrick O'Claire; Utilities Engineer Dave Winship and City Recorder Sue Nelson.

Present from the Tualatin Valley Water District (TVWD) were: Board President Jim Doane; Board Commissioners Richard Burke, Jim Duggan and Dick Schmidt; General Manager Greg DiLoreto; Attorney Clark Balfore; Joint Water Commissioner Jesse Lowman; Former TVWD Board Member Forrest Soth; and Consultant Mark Knudson.

TOPICS FOR DISCUSSION

Regional and Local Water Supply Choice

TVWD Board President Jim Doane reviewed significant events from 2006 that affected the TVWD.  He said in 2006 TVWD signed a ten-year water supply contract with the City of Portland for Bull Run water.  He said Portland also had asked that TVWD find an alternate water source; they were now looking for water source options and were planning to have a new supply source ready by 2016 when the current contract with Portland would expire.      

Mark Knudson, Consultant, Carollo Engineers, presented a PowerPoint presentation on the preliminary engineering for Phase 1 of TVWD's Water Supply Improvements Program.  He said the overall goal of the program was to evaluate the requirements to deliver treated water from the Willamette River to TVWD's service area.  He said the project included construction of a new water transmission main and a new reservoir.  He said the evaluation of the Willamette River Water Treatment Plant was conducted separately. 

Knudson reviewed the Preferred and Alternative Alignments for the water transmission main.  He said the Preferred Alignment follows the Bonneville Power Administration (BPA) right-of-way  from Wilsonville to Beaverton.  He said the benefits to this alignment would be less impact to the community during construction, lower cost and maintenance benefits.  The disadvantages were that the required agreement with BPA may reduce the cost savings therefore implementation and permitting would take longer as this would become a Federal project.

Knudson said in the Alternative Alignment the transmission main would in the public road right-of-way avoiding the BPA corridor.  He said the benefits to being in the public right-of-way were coordination with local governments and a simpler permitting process;  the disadvantages were greater community impact during construction and higher costs.

Knudson said that in conducting the environmental permitting and geotechnical analyses no fatal flaws were identified with either alignment.  He reviewed the challenges with each alignment.  He said their recommendation was:  1) Keep both alignment options open; 2) Continue negotiations with BPA because of the substantial cost savings; 3) Based on the direction of BPA negotiations, make a final decision in early-to-mid 2007; and 4) Initiate right-of-way acquisitions and agreements as early as possible. 

Knudson reviewed the system hydraulics for the pump and transmission main in detail.  He said the size of the main depends on the final alignment and capacity; oversizing the pipeline would provide future flexibility at little cost.  He recommended that TVWD:  1) Continue negotiations with BPA and select the final alignment; 2) Complete the Water Master Plan Update to identify future needs and water source configurations; 3) Identify regional partners; and 4) Oversize the pipeline for future flexibility. 

Knudson said it was recommended that TVWD construct a 20 million gallon (mg) reservoir initially and plan on a second 20 mg reservoir in the future based on the Water Master Plan Update.  He said pre-stressed concrete construction was most appropriate for this reservoir with a floor elevation of 445 feet and overflow elevation of 485 feet for best hydraulic performance.  He said a ten-acre site was needed to accommodate both reservoirs and they should be located on the southern slopes of Cooper Mountain; five feasible sites were identified on Cooper Mountain.  He recommended acquiring the property at the earliest opportunity. 

Knudson said there were many uncertain variables driving the cost (alignment, pipeline sizing, shoring costs).  He said the cost estimates reflected a +50/-30% accuracy range.  He said further work was needed to pin down the variables so that firmer cost projections could be done.  He reviewed the project timeline and said completion was scheduled for the middle of 2016 when the Portland contract expired or would have to be renewed.  He said given the uncertain variables, the estimated cost for the Program (treatment plant, pipeline and reservoir) ranged from $360 to $420 million. 

Knudson said the next steps in the implementation plan for Phase 1 were to continue negotiations with BPA, select a pipeline alignment, complete and adopt the Water Master Plan Update, identify regional partners, initiate property and right-of-way acquisition, update the initial financial plan, and develop/implement a public information program.  Once Phase 1 is completed, Phase 2 - Pre-design Study, will begin. 

Coun. Dalrymple referred to the right-of-way acquisition and asked what the cost parameters were per acre in the financial analysis. 

Knudson said he did not recall the figures for most of the project, though in the reservoir area it would be multiple hundreds of thousands of dollars.

Coun. Arnold asked how this affected TVWD's requirements from the Joint Water Commission (JWC).

General Manager Greg DiLoreto replied that TVWD would maintain its ownership of the ten million-gallons-per-day (mgd) that it has as a partner in the JWC.  He said the issue was which project to select; they could only afford to do one project and they would need 60 mgd.  He said when the requests from all the JWC partners are tallied and the costs are known the partners will then determine how much they can afford to purchase; at that time they will know what is left over.  He said by 2011 they have to be sure that they can get enough water from the JWC at Hagg Lake or they will have to go to the Willamette River.  He said they have to be finished by 2016 to avoid having to renew their agreement with Portland.  He said that while $420 million was a lot of money, over the 50-year life span of the District, going with either of these projects would save TVWD between $1.2 to $1.5 billion over staying with the City of Portland. 

Coun. Dalrymple asked about the quality and cleanliness of the Willamette River in comparison to other sources.

DiLoreto replied that TVWD has conducted an extensive analysis of the Willamette River in its raw-water and finished-water states.  He said TVWD has a table on its Web site that displays the test results from the analyses.  He said the finished water quality was equal to or better than current sources and the raw-water quality was incredible.  He said the public has heard negative stories about the Willamette, but the analyses results indicated that the quality of the drinking water (after it had gone through the treatment plant) was perfect; it had almost met the standards for a kidney dialysis machine.

Knudson said in comparing the treatment residuals for the Willamette River to Bull Run, the Willamette was clearly favored.  He said it was a function of the high quality source water and the extensive treatment process.  He said there were fewer contaminants in treated Willamette River water than in treated Bull Run water.

Commissioner Burke said most of the dynamics involved in the Bull Run source were as much emotional as practical.  He said Bull Run was an excellent water source but there was almost a spiritual connection with that source though there were problems with it.  He said there were turbidity issues and it was not always as pristine as people had believed.  He said the Willamette River was much cleaner than people realized and a public education process would be required.

Commissioner Schmidt said that part of the problem with the reputation of the Willamette River was downstream from Portland with the combined sewer overflows.  He said that besides turbidity and E-coli, the Willamette River has met Federal drinking water standards.

Coun. Doyle said he would assume that the water treatment plant would have to be expanded.  He asked who would pay for the expansion.

DiLoreto said TVWD would pay for it and if they were able to partner with other cities they would share the cost.  He said it would cost about $100 million to expand the water treatment plant to meet TVWD's needs.

Coun. Stanton referred to the project schedule and asked if Knudson had said they wanted to complete the Master Water Plan before selecting the final alignment.

DiLoreto clarified that they were completing a Water Master Plan for all of TVWD.  He said in addition to that they had minor master plans for this project. 

Knudson said the master plan would show the demands on the system and that would be used to size the pipe; the minor master plan would establish the pipeline alignment.  He said once the plans were finished they would begin property acquisition.

Coun. Stanton said she was concerned with the Alternative Alignment because it would go under the 125th Avenue right-of-way.  She asked if the Alternative Alignment was selected would that delay the extension of 125th Avenue another ten years.

Knudson said that TVWD would make a commitment to the City to construct that section of the pipeline with the road.  He said a project would be setup to design, engineer and construct that section of the line with the road construction, so that the road would not have to be torn up a few years later.  He said that same process holds true regardless of which alignment is selected.   

Commissioner Burke compared this project to making a movie in that scenes are never shot in chronological order. 

Coun. Stanton asked if they were hoping to select a final alignment by August 2007.

Knudson said that was the goal.  He said they had hoped to have this done by next month but BPA negotiations necessitated moving the schedule out.  He said conceivably BPA negotiations could move the schedule out further.  He said at some point TVWD would have to decide on whether or not to continue negotiations with BPA; if it looked like it would affect meeting the project's completion deadline.

Coun. Doyle asked if the TVWD was seeking Congressional help with the negotiations.

DiLoreto said they were not for they were getting a positive response from BPA.  He said BPA's Vice Presidents had requested a formal proposal from the District that they could take to their next meeting.

Coun. Dalrymple asked if they had discussed this with the Tualatin Hills Park and Recreation District (THPRD), since the THPRD had right-of-way agreements in place with BPA.  

DiLoreto said he had talked to both THPRD general managers.  He said TVWD had partnered with THPRD on many projects and as this project became closer to construction they would probably do so again. 

JWC Commissioner Jesse Lowman asked how TVWD planned to serve the southern area of the District.  He noted there were no pipelines or cost estimates shown for the south section. 

Knudson said in the master plan they were reviewing whether to build a connecting pipeline from the Old Wolf Creek area southeast to serve Metzger or to continue purchasing water from Portland to serve that area.  He said they would provide a financial analysis to TVWD on that issue so that a decision could be made.  

Coun. Bode asked if the Hagg Lake option was still being considered.

DiLoreto said Hagg Lake was still an option.  He said the options being considered were: Hagg Lake supplemented with Bull Run; the Willamette River with JWC as a backup; Continue with Bull Run, using a smaller portion from JWC; or going exclusively with JWC.  He said the Hagg Lake 40-foot dam raise was a viable option provided it could supply the amount of water needed for all the partners.  He said the numbers were being refined.  The dam raise was planned to meet water needs to Year 2060.

Coun. Dalrymple asked if the Willamette River option was selected, would the dam raise project go away.

DiLoreto said the dam raise was needed for Washington County; TVWD would not participate in the dam raise if the Willamette was selected.  He said Beaverton, Hillsboro, Forest Grove and Clean Water Services needed the water from the dam raise. 

Commissioner Burke added that in looking at projected future growth figures, they have to look at all the options carefully to be sure there will be enough water to meet TVWD's needs.   He said the Willamette option would provide for all their needs.  It was not yet certain that the dam raise would meet the needs of all the JWC partners.

TVWD President Doane gave a copy of the study to Mayor Drake.

Willamette Pipeline Discussion

City Utilities Engineer Dave Winship presented a PowerPoint presentation on regional and local water supply choices (in the record).  He reviewed the City's water service area, the water main system and the supply source.  He also reviewed the components of the JWC system, including Hagg Lake/Scoggins Reservoir, Barney Reservoir, the treatment plant, transmission lines, storage tanks, the master meter and water supply and consumption figures.  He said the purpose of the Tualatin Basin Water Supply Project (Project) was to evaluate long-term water sources for the future needs of this region.  The members of the Tualatin Basin Water Supply Partnership were:  the cities of Beaverton, Hillsboro, Tigard, Tualatin, and Forest Grove; TVWD; Clean Water Services; Tualatin Valley Irrigation District; and the U.S. Bureau of Reclamation.

Winship reviewed the Tualatin Basin Water Supply Project in detail.  He noted the options available were:  1) No Action; 2) 40-Foot Scoggins Dam Raise; or 3) 25-Foot Scoggins Dam Raise and the Willamette River System.  He reviewed the property impacts that would occur with the dam raise options and the water quality in Hagg Lake.  He said the construction cost estimate for the 40-foot raise was $199 million; for the 25-foot raise it was $166 million.  He reviewed the Project schedule and noted design and construction should begin in 2010. 

Winship said the City's second water source was its Aquifer Storage and Recovery (ASR) System that provides a pumping capacity of 6 mgd, which is a large part of the City's source.  He reviewed how the ASR system operates and the daily and seasonal water use from that system.  He reviewed storage cost information for the ASR system and noted it costs much less to store water underground than above ground.  He also noted that capital costs were much less for an ASR system than for a conventional surface water supply system.  He reviewed the location of the ASR wells and the amount of water each well pumps daily. 

Winship reviewed how the City would meet future water supply and demand needs with the recommended supply system improvements (in the record).   He said Beaverton's costs for these improvements (Scoggins/Barney/JWC Supply System)  from 2007-2021, would be about $39.2 million (unit cost of $6.77 million per mgd).  He reviewed the existing regional water supply sources.  He said it was important that the City continue to coordinate closely with TVWD on the Willamette River pipeline options, as it is a viable project financially and it would be good to have those transmission lines coming through Beaverton.  He said the City also needed upper-level storage and the opportunity to coordinate on the reservoir sites was extremely important.  He said the estimated cost for the Willamette Supply System was $360 - $420 million for 70 mgd (unit cost of $5.1 - $6.0 million per mgd).  He said these costs compared favorably with the Scoggins Project and it would be an option for Council to consider in the future. 

Coun. Doyle asked what the rationale would be for selecting the 25-foot raise versus the 40-foot raise, when the 40-foot raise would provide a higher yield for only 20% more in cost. 

Winship said the Bureau of Reclamation suggested looking at a smaller footprint.  He said he did not think the technical staff felt the 25-foot raise was a good deal. 

DiLoreto said the 25-foot raise would assume that TVWD was not part of the project.  He said while the cost for the 40-foot raise was not that much more, the question to be answered was who would pay for that additional cost.   He said also if they went with the 25-foot raise, in the future they would have to raise the dam again and the rules would get stricter and the cost would be much higher. 

Winship said the productivity of the Hagg Lake watershed was half of that from Bull Run.  He said he did not believe that if they built a 25-foot dam that they would ever be able to expand it again; it would be better to build the 40-foot raise now.

Coun. Doyle said he presumed that it would not be good to put all of their eggs in one basket in case something happened to one of the water sources.  He said that was why the two projects made sense.
President Doane said Beaverton was spared in 1992 draught but TVWD was not.  He said in 1992 TVWD went to no outdoor water use and that taught them that one supply source was not sufficient.  He said if they went to the Willamette that would give them three sources (Bull Run/JWC/Willamette).  He said it was intriguing to have three sources instead of two.

Coun. Stanton said it would provide more stability.

Coun. Doyle said it made sense that the region look at enhancing the ways it delivers water since it is vital to many of the industries.

Commissioner Schmidt noted that in 1996 Bull Run was sucking mud and that was with the population density from ten years ago.  He said with the population projections for 2025 Bull Run alone was not sufficient.

Mayor Drake said he was concerned about discussions that have occurred regarding the Bureau of Reclamation no longer owning Scoggins Dam.  He said the JWC has worked well with joint ownership based on percentage of ownership of the dam.  He said there had been discussions about the County replacing the Bureau.  He said he thought it would make more sense to form a joint ownership of the dam (ORS 190) as was done with the JWC.  

DiLoreto said as partners, though the County was leading the effort through Clean Water Services, they were talking about a transfer of ownership with the Bureau; this would transfer the ownership of the existing and future dam to an ORS 190 agency.  He said from the TVWD perspective, they would prefer to be an owner than a renter.  He said if the title was transferred, the Federal rules would no longer apply.  He said TVWD was pushing this forward as it needs to get out from its partnership with Portland.  He said they would prefer a joint ownership like the JWC.

Coun. Dalrymple asked how the service territories would be established; how would they fit into the planning.

Winship said the moderate growth scenario does not include any dramatic annexations.  He said the City's current agreement with TVWD was that it would not withdraw territory as it was annexed.  He said the moderate scenario peaks out at 2026 and it did include the southwest area beyond the Urban Growth Boundary.  He said it assumed an area contemplated in agreement with the TVWD and a population increase of 10,000 due to that expansion.  He said infill was also assumed in that scenario.  He said the high growth scenario assumes everything in the moderate scenario and some annexation in West Slope and Raleigh Water Districts. 

Commissioner Duggan asked if the 25-foot dam raise included the pump back options.

President Doane replied that it really did not work. 

Coun. Bode said she was concerned with the lack of concrete economic forecasting for this project; to her this was an impediment to going forward.  She noted, as an example, the tram in Portland ended up costing four times what was projected.  She said the growth assumptions for this project were also up for question.   
Mayor Drake said his comfort level today as an average citizen, was better because they had a lot more data today to prepare the forecast than they had 25 years ago.  He said Metro was recognized nationally for its modeling and projecting and they were utilizing Metro's work as the foundation for these projections.  He said this modeling was also conservative. 

Coun. Bode said she has to understand the parameters used for these projections.  She said this was going to be a hard sell.

Commissioner Schmidt said the basic assumptions were sound barring an unforeseen significant occurrence. 

DiLoreto said they were not ready for a decision by elected officials yet. 

Coun. Bode said her comments were not meant to be critical; they were given as a form of inquiry.  She said cost estimate differences that are in the range of many millions of dollars would be a hard sell to the public as well as elected officials.

President Doane explained that the assumptions for growth are based on parameters.  He said the parameters are discussed and they pinpoint why each was chosen.  He said that way they know all the elements that are driving the demand figures.  He said that was a reasonable approach to reduce the uncertainty and get closer to actual figures. 

Winship said some components have to be committed to, such as the life of the dam; other components are discretionary and can be made as growth occurs.  He said they postponed many of the treatment plant and transmission improvements with ASR.  He said the treatment plant for the Willamette and the JWC can be adjusted around growth.  He said while it was impossible to predict exactly what would happen, the City would not have to spend the $124 million in the first part of the project and commit forever for that; there are options over the next 15-20 years to reduce the project if the growth does not occur. 

Coun. Dalrymple said because of the tram project the bar has been raised in the public eye relative to setting standards and parameters for project cost estimates.  The City would have to have a higher level of reliability.  He said that was not something to be decided this evening; just that this project would be scrutinized.

President Doane said they would not say that it could not cost more than $100 million.  He said they would get real numbers and not just something that sounds good then has to be continually adjusted.

Coun. Arnold said the City has more experience with and knows more about this subject and project.

Commissioner Schmidt said he could see in the future having a regional water supply where all the supplies are connected. 

Coun. Arnold said that would make sense.

Mayor Drake thanked the TVWD Board for the meeting.  He said he was sorry about the loss of Gordon Martin; he had been a very active member of the Board and his untimely death was a great loss.  He added that the TVWD provides water for parts of Beaverton and the two agencies were intertwined.

President Doane said the Board would meet next week to choose Martin's replacement for the next few months then someone would be elected on May 17, 2007, to fill the last two years of Martin's position. 

ADJOURNMENT

There being no further business before the Council or TVWD Board, the meeting was adjourned at 8:00 p.m.

APPROVAL:

Approved this 26th day of February, 2007.

__________________________________
Rob Drake, Mayor