You will recall that there were not enough Supes present at the last Board of Supervisors meeting to be able to vote on $money$ matters, so here we go:
See item #2 under Board Business:
http://agenda.slocounty.ca.gov/agenda/sanluisobispo/1045/QWdlbmRh/6/n/91217.doc
And check all of the documents off of this link:
http://agenda.slocounty.ca.gov/agenda/sanluisobispo/Proposal.html?select=8476
Showing posts with label ARB Lawsuit. Show all posts
Showing posts with label ARB Lawsuit. Show all posts
Friday, March 02, 2018
Friday, February 23, 2018
Gibson's Plan To Lessen Sewer Settlement Shock
Los Osian Facebook users, see how Bruce Gibson will help us with the ARB lawsuit settlement costs:
https://www.facebook.com/bruce.gibson.1069/posts/1604269509665995
There was a lot of talk about how the County was culpable in screwing this up resulting in a $9.95 million settlement to ARB, but this really is just hogwash. ARB was sneaky and low-bid one part of the two collection system contracts offered. Then they lost the other bid. When the work for that bid they won started to overwhelm what they planned for, they started to lose money, so they did a bunch of sketchy change orders, trying to squeeze the County for more $$$.
The County had no choice but to accept ARB's bid and suspected that this was coming, but the law made them take it. (The other collection system bid was won by W.A. Rasic (remember the "WAR" logo on their equipment? No problems, on time, on budget.)
Gibson just posted tonight. He explained this plan this afternoon as his Los Osos Office Hours (February 22 - so I guess it is now yesterday afternoon.) He also outlined the plan again at the LOCAC meeting later, in the evening. He better get re-elected, or we might be screwed. No one else could possibly know the ins and outs of this sewer game is played to be able to figure out how to protect us from a backbreaking payback. Especially in negotiating with the state to try to lower our EPA loan down from 2%. Maybe the whole thing could be refinanced, saving us a bundle!
When he posts this information on his webpage, you might find it yourself before I post the link here (for non-Facebook users).
This was posted on Nextdoor today, which is from Bruce's Facebook page:
Bruce said: My position on the proposed settlement of the Los Osos sewer lawsuit: While I’m not happy about it, I will support paying the $9.95 million settlement from the county’s general fund reserves at our Board of Supervisors meeting on March 6. This is the final bill for constructing the sewer and it closes a long and contentious chapter in the history of Los Osos. Sewer rates will not be changed at the March 6 meeting. Assuming these funds are to be repaid to the general fund by sewer users, I will not support raising rates above the maximum levels approved by ratepayers in 2009. Any increase above the maximum levels would have to be approved by ratepayers. The details: Q: Where’s the money coming from to pay this settlement? Short answer: From the county’s general fund reserves. Long answer: On March 6, the action before the Board is to pay the settlement using funds from the county’s Solar Plant Mitigation Funds. These funds were collected in lieu of the sales tax that would have been paid if the solar panels and other construction materials for the big California Valley solar projects had been purchased in SLO County. They mitigate the sales tax loss (not the projects’ physical impacts) and currently total about $15 million. Q: How will this affect sewer rates? Short answer: The effect is yet to be determined. No change to sewer rates will be made on March 6. I will not support raising rates above the maximum already approved by ratepayers in 2009 in order to pay this settlement (see question below). Long answer: The effect on sewer rates depends on, a) the BOS as a whole requiring the sewer ratepayers to repay the reserve fund, which seems likely, and b) how the repayment is financed in terms of interest rate and length of loan. I am currently working with county staff and the State Water Resources Control Board on a refinancing proposal that might produce a minimal effect on rates. It will take several months to know whether this can be accomplished, but the SWRCB indicated at the time of the original loan that we could ask for a reduction in the interest rate below the current level of 2%. Another approach, among others, might be to structure the repayment as a loan from the county’s general fund. Q: What maximum rate increase could you support? Short answer: Any increase must be within the voter-approved rates. The maximum charge for a single family home could be raised by about $4.79/month under the currently approved rate structure. Long answer: In 2009, sewer users voted to approve a “rates and charges” ordinance under the provisions of Proposition 218. For a single family home, the rate is currently $44.06/month (fixed) plus $7.54/month per unit of water used indoors. A “unit” is 100 cubic feet or 748 gallons. The average home is charged about $157/month total – less than the $165/month we had originally estimated. The maximum fixed rate authorized in 2009 is $48.85/month or $4.79/month more than currently. The maximum average charge would then rise to about $162/month. Q: What if the BOS wants to raise rates higher? Short answer: The board would have to put any greater rate increase to a vote by the sewer ratepayers under the provisions of Prop 218. The ratepayers then decide. Longer answer: I won’t support even asking ratepayers for such an increase to pay this settlement. Q: Why did the county get sued? Short answer: A contractor on the sewer’s collection system, ARB Inc., submitted a low-ball bid to get the contract and then wanted more money for the work they were obligated to perform. Long answer: The sewer’s collection system (pipes in the streets) was so big that we split the contract into roughly equal halves. ARB was awarded the contract on one half, with a low bid of about $26 million – way under the next lowest bid of almost $35 million. This appeared to be a low-ball bid, but the county was obligated by state public contracting law to accept it. As work progressed, ARB claimed they were owed more money for the work they contracted to do because of conditions in the field that they claimed the county should have told them about. The strategy of increasing payments through unjustified change orders is not uncommon in public contracting. Q: So was the county at fault for this by being incompetent, inattentive or deceptive? Short answer: No. Long answer: The $26 million bid was clearly low when compared to the six competing bids, which ranged from approximately $35-$42 million. When ARB bid (unsuccessfully) on the other half of the collection system, their bid was $36 million. The county had stringent construction management procedures in place for both halves of the collection system. The contractor on the other half (W.A. Rasic, low bid of $29 million) made no unreasonable claims and completed their contract within budget. Q: Why is the county choosing to settle this lawsuit rather than fight it? Short answer: ARB claimed they were owed another $23 million. If this complex case went to trial, we would likely expend another $1.5 million in attorney and expert fees and risk an unsympathetic jury awarding them the $23 million they sought. We held our nose and agreed to a $9.95 million settlement to avoid that risk. Long answer: This case is extremely complex, involving the arcane details of construction practice and contract law. In four years of defending this litigation, we have already spent over $2.4 million on attorney and expert fees. The case was moved out of the SLO County courts and is being heard in Santa Maria, where juries are expected to be unsympathetic toward government.
https://www.facebook.com/bruce.gibson.1069/posts/1604269509665995
There was a lot of talk about how the County was culpable in screwing this up resulting in a $9.95 million settlement to ARB, but this really is just hogwash. ARB was sneaky and low-bid one part of the two collection system contracts offered. Then they lost the other bid. When the work for that bid they won started to overwhelm what they planned for, they started to lose money, so they did a bunch of sketchy change orders, trying to squeeze the County for more $$$.
The County had no choice but to accept ARB's bid and suspected that this was coming, but the law made them take it. (The other collection system bid was won by W.A. Rasic (remember the "WAR" logo on their equipment? No problems, on time, on budget.)
Gibson just posted tonight. He explained this plan this afternoon as his Los Osos Office Hours (February 22 - so I guess it is now yesterday afternoon.) He also outlined the plan again at the LOCAC meeting later, in the evening. He better get re-elected, or we might be screwed. No one else could possibly know the ins and outs of this sewer game is played to be able to figure out how to protect us from a backbreaking payback. Especially in negotiating with the state to try to lower our EPA loan down from 2%. Maybe the whole thing could be refinanced, saving us a bundle!
When he posts this information on his webpage, you might find it yourself before I post the link here (for non-Facebook users).
This was posted on Nextdoor today, which is from Bruce's Facebook page:
Bruce said: My position on the proposed settlement of the Los Osos sewer lawsuit: While I’m not happy about it, I will support paying the $9.95 million settlement from the county’s general fund reserves at our Board of Supervisors meeting on March 6. This is the final bill for constructing the sewer and it closes a long and contentious chapter in the history of Los Osos. Sewer rates will not be changed at the March 6 meeting. Assuming these funds are to be repaid to the general fund by sewer users, I will not support raising rates above the maximum levels approved by ratepayers in 2009. Any increase above the maximum levels would have to be approved by ratepayers. The details: Q: Where’s the money coming from to pay this settlement? Short answer: From the county’s general fund reserves. Long answer: On March 6, the action before the Board is to pay the settlement using funds from the county’s Solar Plant Mitigation Funds. These funds were collected in lieu of the sales tax that would have been paid if the solar panels and other construction materials for the big California Valley solar projects had been purchased in SLO County. They mitigate the sales tax loss (not the projects’ physical impacts) and currently total about $15 million. Q: How will this affect sewer rates? Short answer: The effect is yet to be determined. No change to sewer rates will be made on March 6. I will not support raising rates above the maximum already approved by ratepayers in 2009 in order to pay this settlement (see question below). Long answer: The effect on sewer rates depends on, a) the BOS as a whole requiring the sewer ratepayers to repay the reserve fund, which seems likely, and b) how the repayment is financed in terms of interest rate and length of loan. I am currently working with county staff and the State Water Resources Control Board on a refinancing proposal that might produce a minimal effect on rates. It will take several months to know whether this can be accomplished, but the SWRCB indicated at the time of the original loan that we could ask for a reduction in the interest rate below the current level of 2%. Another approach, among others, might be to structure the repayment as a loan from the county’s general fund. Q: What maximum rate increase could you support? Short answer: Any increase must be within the voter-approved rates. The maximum charge for a single family home could be raised by about $4.79/month under the currently approved rate structure. Long answer: In 2009, sewer users voted to approve a “rates and charges” ordinance under the provisions of Proposition 218. For a single family home, the rate is currently $44.06/month (fixed) plus $7.54/month per unit of water used indoors. A “unit” is 100 cubic feet or 748 gallons. The average home is charged about $157/month total – less than the $165/month we had originally estimated. The maximum fixed rate authorized in 2009 is $48.85/month or $4.79/month more than currently. The maximum average charge would then rise to about $162/month. Q: What if the BOS wants to raise rates higher? Short answer: The board would have to put any greater rate increase to a vote by the sewer ratepayers under the provisions of Prop 218. The ratepayers then decide. Longer answer: I won’t support even asking ratepayers for such an increase to pay this settlement. Q: Why did the county get sued? Short answer: A contractor on the sewer’s collection system, ARB Inc., submitted a low-ball bid to get the contract and then wanted more money for the work they were obligated to perform. Long answer: The sewer’s collection system (pipes in the streets) was so big that we split the contract into roughly equal halves. ARB was awarded the contract on one half, with a low bid of about $26 million – way under the next lowest bid of almost $35 million. This appeared to be a low-ball bid, but the county was obligated by state public contracting law to accept it. As work progressed, ARB claimed they were owed more money for the work they contracted to do because of conditions in the field that they claimed the county should have told them about. The strategy of increasing payments through unjustified change orders is not uncommon in public contracting. Q: So was the county at fault for this by being incompetent, inattentive or deceptive? Short answer: No. Long answer: The $26 million bid was clearly low when compared to the six competing bids, which ranged from approximately $35-$42 million. When ARB bid (unsuccessfully) on the other half of the collection system, their bid was $36 million. The county had stringent construction management procedures in place for both halves of the collection system. The contractor on the other half (W.A. Rasic, low bid of $29 million) made no unreasonable claims and completed their contract within budget. Q: Why is the county choosing to settle this lawsuit rather than fight it? Short answer: ARB claimed they were owed another $23 million. If this complex case went to trial, we would likely expend another $1.5 million in attorney and expert fees and risk an unsympathetic jury awarding them the $23 million they sought. We held our nose and agreed to a $9.95 million settlement to avoid that risk. Long answer: This case is extremely complex, involving the arcane details of construction practice and contract law. In four years of defending this litigation, we have already spent over $2.4 million on attorney and expert fees. The case was moved out of the SLO County courts and is being heard in Santa Maria, where juries are expected to be unsympathetic toward government.
Wednesday, February 14, 2018
ARB Lawsuit Over At Last!
http://www.sanluisobispo.com/news/local/article200135409.html
Well, it is finally over. And sad to say, it is cheaper to settle than to fight the thing. ARB didn't follow the rules. I guess they have paid their attorneys too during all of this time. So they, like we, are out that money. We did get a sizable discount anyway, which is also how these things usually go.
Here is the original article on the lawsuit:
http://www.sanluisobispo.com/news/local/article200135409.html
Read the County staff report here:
http://agenda.slocounty.ca.gov/agenda/sanluisobispo/8402/SXRlbSBEb2N1bWVudCAoUHVibGljKSA=/14/n/90145.doc
Well, it is finally over. And sad to say, it is cheaper to settle than to fight the thing. ARB didn't follow the rules. I guess they have paid their attorneys too during all of this time. So they, like we, are out that money. We did get a sizable discount anyway, which is also how these things usually go.
Here is the original article on the lawsuit:
http://www.sanluisobispo.com/news/local/article200135409.html
Read the County staff report here:
http://agenda.slocounty.ca.gov/agenda/sanluisobispo/8402/SXRlbSBEb2N1bWVudCAoUHVibGljKSA=/14/n/90145.doc
Wednesday, January 06, 2016
Los Osos Sewer Job Openings!
Next Tuesday January 12, at the Board of Supes, a job opening item goes on the Consent Agenda! We are moving closer to flushing and forgetting. And on that note, we should NOT be forgetting what NOT to flush - dental floss, diapers, condoms, kleenex, baby wipes, other types of wipes, toilet scrub pads, and most of all - drugs. (I keep wondering what one does with used diapers and wipes - plastic bags, I guess, so as not to stink up the house. But then, that doesn't sound very environmentally friendly.)
16. CONFERENCE WITH LEGAL COUNSEL - PENDING LITIGATION (Government Code section 54956.9.) It is the intention of the Board to meet in closed session concerning the following items: Existing Litigation (Gov. Code, section 54956.9(a)). (Formally initiated.) (3) ARB, Inc. v. County of San Luis Obispo;
I will update number 10 with a link when the relevant documents are posted on the Supe's agenda website.
This popped up this morning:
http://agenda.slocounty.ca.gov/agenda/sanluisobispo/Proposal.html?select=5533
Consent Agenda - Public Works Items:
10. Request approval to hire three (3) Wastewater Systems Workers, at pay level Steps 4 and 5, for the Los Osos Water Recycling Facility. District 2.
- And then, of course, there is this which we will probably never learn much about:Closed Session Items:
I will update number 10 with a link when the relevant documents are posted on the Supe's agenda website.
This popped up this morning:
http://agenda.slocounty.ca.gov/agenda/sanluisobispo/Proposal.html?select=5533
Tuesday, March 24, 2015
ARB On BOS Closed Session..........Again
Tuesday, March 24, 2015
Closed Session Items:
18. PENDING LITIGATION (Gov. Code, section 54956.9.) It is the intention of the Board
to meet in closed session concerning the following items: Conference with Legal
Counsel-Existing Litigation (Gov. Code, section 54956.9(a).) (Formally initiated) 1.
ARB, Inc. v. County of San Luis Obispo;
It will be interesting to see how long this remains on the agenda!
It will be interesting to see how long this remains on the agenda!
Tuesday, March 03, 2015
Sewer Lawsuit On BOS Schedule
Off the Board of Supes Agenda for Tuesday, March 10:
-
Closed Session Items:
- PENDING LITIGATION................ 2. ARB, Inc. v. County of San Luis Obispo;
Looks like some movement on this lawsuit which has been very, very quiet for months. It was originally filed February 26, 2014.
The Tribune published articles on it March 20, 2014 and April 13, 2014. The gist of ARB's argument is that the County breached the contract between them. The County claims that ARB did not follow the rules.
Needless to say, unless someone blabs, we are unlikely to learn much else until it is over, or over-ish, in case the Court's decision is appealed.
And really, what is the Los Osos sewer project, no matter whose hands it is in, without a lawsuit? Let's not buck tradition here!
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