BOARD AGENDA MEMORANDUM
Government Code § 84308 Applies: Yes ☐ No ☒
(If “YES” Complete Attachment A - Gov. Code § 84308)
SUBJECT: Title
Approve a Sole Source Designation, Adopt Plans and Specifications, and Authorize Advertisement for Bids for the West Pipeline Inspection and Rehabilitation Project - Phase 2, as Part of the 10-Year Pipeline Inspection and Rehabilitation Project, Project No. 95084002, Contract No. C0719 (Los Gatos, Campbell, Saratoga, Cupertino, Los Altos, and Santa Clara, Districts 4, 5, and 7).
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RECOMMENDATION: Recommendation
A. Find that certain Supervisory Control and Data Acquisition instrumentation components as specified in the Plans and Specifications be designated as sole source products to match other products already in use at other Santa Clara Valley Water District facilities using the Supervisory Control and Data Acquisition system. Public Contract Code Section 3400(c)(2);
B. Find that the West Pipeline Inspection and Rehabilitation Project - Phase 2 is substantially complex and, therefore, requires construction contract retention of ten percent (10%);
C. Adopt the Plans and Specifications and Authorize Advertisement for Bids for construction of the West Pipeline Inspection and Rehabilitation Project - Phase 2, per the Notice to Bidders; and
D. Authorize the Designated Engineer to issue addenda, as necessary, during the bidding process.
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SUMMARY:
The objective of the West Pipeline Inspection and Rehabilitation Project - Phase 2 (Project) is to increase the reliability and useful life of the pipeline.
The Project scope includes completely draining and removing all water from the West Pipeline in the section between Cox Line Valve and Granger Turnout, performing repairs on pipeline appurtenances, abandoning outfalls, replacing line valves, installing new line valves and vaults, providing support for a manned internal pipeline inspection, procuring long-lead material, installing supervisory control and data acquisition (SCADA) system components, installing corrosion protection systems, and performing internal pipeline repair work as identified during the inspections. A portion of the work related to installing new line valves will be funded by the Safe, Clean Water and Natural Flood Protection Program Project A3: Pipeline Reliability Project, also known as the IRP2 Additional Line Valve Project, Project No. 26764001, and another portion of the work will be funded by the Treated Water Isolation Valve Project, Project No. 94084007.
Staff is recommending that the Board approve the Project’s Plans and Specifications and authorize advertisement for construction bids per the Notice to Bidders (Attachment 3).
Project Background
The West Pipeline is included in Santa Clara Valley Water District’s (Valley Water) Pipeline Maintenance Program (PMP) and is an identified capital effort in the 10-Year Pipeline Inspection and Rehabilitation Project. The PMP defines the activities associated with maintenance and repair of water supply conveyance systems including pipelines, appurtenances, electrical systems, control systems, and structures, throughout Valley Water’s jurisdiction.
The purpose of the 10-Year Pipeline Inspection and Rehabilitation Project is to maintain the integrity of the approximately 150 miles of large-diameter raw and treated water transmission pipelines, extend their useful life, and address infrastructure reliability concerns. Other projects completed as part of the 10-year Inspection and Rehabilitation Project include: Snell Pipeline, Santa Clara Conduit Rehabilitation & Pacheco Sectionalizing Vault Replacement, Almaden Valley Pipeline, Pacheco Conduit, Cross Valley and Calero Pipelines, and Central and Parallel East Pipelines.
West Pipeline
The West Pipeline (WPL) consists of approximately 9.1 linear miles of 84-inch to 30-inch welded steel pipe (WSP) and bar-wrapped pipe (BWP) with four distributary lines. It conveys treated water from the Rinconada Water Treatment Plant to various water retailers in multiple cities in the northwest corridor of Santa Clara Valley. The first segment of the West Pipeline was constructed in 1965, and a second segment was constructed in 1967 to expand the service to Mountain View. The West Pipeline is owned and operated by Valley Water. It begins at Rinconada Water Treatment Plant, runs northwest, primarily along the Union Pacific Railroad (UPRR) corridor, through the Town of Los Gatos, the cities of Campbell, Saratoga, Los Altos, Cupertino, and ends at Granger Turnout
The West Pipeline will be inspected and rehabilitated in two phases. The first phase covered the pipeline from Rinconada Water Treatment Plant to the Cox Line Valve. Phase 2 (this contract) is from the Cox Line Valve to the Granger Turnout with the installation of two additional line valves. The construction of Phase 2 of the Project is expected to be completed in March 2028.
Construction Contract Retention
Public Contract Code (PCC) Section 7201 limits retention amounts for public works construction contracts to five percent (5%) of the total contract price. PCC section 7201(b)(4) provides that retention proceeds on a project may exceed 5% where the Board makes a finding that the proposed project is “substantially complex” and, therefore, requires a retention amount greater than 5%.
To comply with the PCC regarding increasing the retention to 10%, staff recommends that the Board find that the Project is substantially complex. Substantially complex Project challenges, in this case, pertain to the complexity and precision required to conduct critical work within a constrained shutdown schedule. The pipeline shutdown durations are negotiated up to years in advance and require the cooperation of other water agencies to minimize unplanned disruption in the delivery of treated water from Rinconada Water Treatment Plant throughout Santa Clara County. A disruption in the delivery of treated water in Santa Clara County could result in water shortages and disruption to water retailers.
The shutdown-required work including, the installation of the two-line valves and vaults, requires extensive coordination with a Valley Water third-party contractor to complete internal inspections and repairs. The full scope of the internal pipeline repairs is not known until a comprehensive electromagnetic and visual inspection of the pipeline is completed and the results of the inspections have been analyzed. In addition to shut down-required work, the Project also requires the procurement of long-lead materials for the installation of large valves. The Project construction schedule requires a minimum of one year for material procurement prior to the start of the pipeline shutdown. The level of precision and coordination required for this Project is unique and beyond what is customarily required of a pipeline project.
Sole Source Justification
For a sole source product to be mandated by a public entity for a construction project, at least one of four criteria must be met as stated in PCC 3400(c). For this Project, PCC Section 3400(c)(2) allows the awarding authority to make a finding that such designations are justified to obtain necessary items to match other products in use on a particular public improvement, either completed or in the course of completion.
To comply with the PCC regarding the use of sole source products for Project construction, staff recommends that the Board find certain items as specified in the Plans and Specifications are necessary to match the existing equipment already in use at other Valley Water facilities using the District’s SCADA system.
Releasing certain information in the Plans and Specifications, including identification of the sole source products and details of the integration of the products into the existing information technology systems, to the public, may increase the potential for an attack on a Valley Water information technology system. To protect Valley Water’s information technology systems, all parties interested in accessing the Project Plans, Specifications, and addenda, must register as a vendor at the Valley Water Vendor Portal and submit a completed Non-Disclosure Agreement (NDA) to access the Contract Documents.
Board Adoption of Plans and Specifications and Addenda Authorization
Board adoption of plans and specifications and Board authorization to advertise is recommended in order to proceed to bid the Project for construction. Authorizing the Designated Engineer to issue addenda during the bidding allows for modifications to the construction Contract Documents, if necessary, during the bidding period and before the contract is awarded.
The Project Plans, Specifications, and justification for the recommended sole source products were provided by separate communication to Valley Water’s Board of Directors for their review, prior to taking the recommended action to adopt the Plans and Specifications for bid advertisement. Addenda will be provided to the Board pursuant to the same communication protocols. The Notice to Bidders informs interested parties that they must execute a NDA in order to access the Plans, Specifications, and addenda.
Relevant Prior Board Actions:
On September 24, 2024, the Board considered Addendum No. 2 to the 2007 PMP EIR prior to adopting the plans and specifications and authorizing advertisement for bids for the West Pipeline Inspection and Rehabilitation Project - Phase 1.
On April 8, 2025, the Board adopted Resolution 2025-26 specifying intent to consider undertaking the Project and setting the time and date for a public hearing on the Final Engineer’s Report for the 2025 Pipeline Maintenance Program.
On April 22, 2025, the Board held a public hearing and adopted Resolution 2025-26 certifying the Final 2025 PMP EIR, approving the PMP Engineer’s Report, and approving the 2025 PMP.
Rights of Way
Valley Water has all the necessary right-of-way needed for the construction of the Project. One temporary construction easement is being negotiated for optional contractor staging.
The construction contract will not be awarded by Valley Water until the right-of-way is secured.
Permits
Staff is working to amend the Project’s existing Lake Streambed Alteration (LSA) Agreement with the California Department of Fish and Wildlife (CDFW). The construction contract will be awarded by Valley Water once the LSA Agreement is signed and secured.
Staff is working to obtain the conditional right-of-way letters from the City of Saratoga, City of Cupertino, and City of Los Altos. The final approved encroachment permits from these cities will be completed by the contractor after the construction contract is awarded and issued prior to construction commencement.
Staff has also applied for an encroachment permit from Union Pacific Railroad for the construction of two vaults. The final approved encroachment permit will be completed after the construction contract is awarded to the lowest bidder and the contractor information is obtained to execute and finalize the agreement. All permanent structures will be built within the existing right-of-way.
Next Steps
If the Board approves the recommendations, staff will proceed to advertise the Project for construction bids. Staff anticipates recommending the Board award a construction contract in August 2025.
ENVIRONMENTAL JUSTICE AND EQUITY IMPACT:
The Project has incorporated noise-mitigating measures into the design. Measures include requiring the contractor to install sound-mitigating panels and to adhere to stringent noise levels per City and County Regulations.
FINANCIAL IMPACT:
There is no financial impact associated with the recommendation to Adopt Plans and Specifications and Authorize Advertisement for Bids.
The West Pipeline Inspection and Rehabilitation Project - Phase 2 (West Pipeline Project) is part of the 10-Year Pipeline Inspection and Rehabilitation Project, Project No. 95084002. Also contributing to the West Pipeline Project are the IRP2 - Additional Line Valve Project, Project No. 26764001, and the Treated Water Isolation Valve Project, Project No. 94084007. All contributing projects are included in the Capital Improvement Program (CIP) Fiscal Years (FY) 2025-29 Five-Year Plan and in the FY 2024-25 Adopted Budget. Based upon estimated construction contract costs, there are adequate funds in the Project’s FY 2025 Adopted Budget to encumber the planned expenditures for construction to be incurred during this fiscal year. The estimated cost of the Project is $24 million.
Funds to cover the remaining anticipated construction costs will be included in the biennial budget process and recommended by staff during the annual fiscal year budget process or through budget adjustment(s) if needed.
The West Pipeline Project, Project No. 95084002, is funded by the Water Utility Enterprise Fund (Fund 61) with 95.89% of the costs of the 10-Year Pipeline Inspection and Rehabilitation Project allocated to Zone W-2 (North County), 3.16% to South County Zone W-5, 0.89% to South County Zone W-7, and 0.06% to South County Zone W- 8.
CEQA:
On April 22, 2025, the Board certified an Environmental Impact Report for the 2025 Pipeline Maintenance Program (PMP EIR) (accessible via <https://fta.valleywater.org/dl/qRvvY7YPH2 <https://fta.valleywater.org/dl/qRvvY7YPH2>>). The 2025 PMP provides for the routine inspection, rehabilitation, and maintenance of Valley Water’s raw and treated water pipelines and evaluates the environmental impacts of the PMP activities. All proposed activities for the WPL Project, including the installation and construction of two new underground valves and vaults, are adequately analyzed in the 2025 PMP EIR. During Project construction, Valley Water and its contractor will comply with all applicable BMPs and mitigation measures from the 2025 PMP EIR and permit conditions.
ATTACHMENTS:
Attachment 1: Notice to Bidders
Attachment 2: Project Delivery Process Chart
Attachment 3: Map
UNCLASSIFIED MANAGER: Manager
Emmanuel Aryee, 408-630-3074