Also serving the communities of De Luz, Rainbow, Camp Pendleton, Pala and Pauma

RMWD approves contract for new water meters

ZMFU II Inc. will be installing advanced water meters for the Rainbow Municipal Water District.

A 4-0 Rainbow board vote Oct. 23, with Bill Stewart absent, approved the installment purchase contract with ZMFU II, along with an amendment to a previously approved contract with ABM Building Services LLC to purchase the meters.

“We’re upgrading the services,” Rainbow general manager Tom Kennedy said.

In 2015 the Rainbow district conducted an annual water audit using the American Water Works Association water audit software. The audit compared the quantity of water Rainbow purchased from the San Diego County Water Authority with the water sold through customer meters to determine the amount of water which was purchased but not sold. That process also accounts for water placed in or withdrawn from district reservoirs.

Approximately 7 percent of the water Rainbow purchased was not accounted for through sales or storage addition.

“We have about $1.6 million more water than what goes through the meters,” Kennedy said.

That $1.6 million is based on 1,260 acre-feet of loss and a wholesale rate, not including fixed charges, of $1,305. Rainbow staff assessed whether the lost volume was due to leaks or to meter inaccuracies. Rainbow’s largest leaks divert approximately one acre-foot of water, so the average of 3.5 acre-feet per day ruled out leaks as the cause and led to a review of the district’s meters.

“The district has a wide range of meters in our water system,” Kennedy said.

In 2016 and 2017, Rainbow and ABM Building Solutions performed meter testing which involved the random selection of 333 meters. Most of the tests were conducted through a third-party testing service while some of the larger meters were tested using calibrated testing equipment in the field. Each meter was tested at multiple flow rates representing low, medium, and high flow scenarios and the accuracy of each meter was rated by a ratio of 15 percent low flow, 70 percent medium flow and 15 percent high flow. The individual flow accuracies were added to determine the weighted accuracy of each individual meter.

That accuracy testing was broken down by meter size. The four tested 5/8-inch meters averaged 90.5 percent accuracy, the 91 reviewed 3/4-inch meters averaged 95.2 percent accuracy, the 81 one-inch meters tested to be 92.2 percent accurate, 62 tested 1 1/2-inch meters had a 91.5 percent accuracy, the 62 two-inch meters had an accuracy of 94.4 percent, the 22 three-inch meters were deemed 97.0 percent accurate and the 11 four-inch meters had an accuracy of 97.8 percent. Rainbow serves 0.5 percent of the district’s total consumption through 5/8-inch meters, 10.9 percent with 3/4-inch meters, 29.8 percent by 1-inch meters, 17.8 percent through 1 1/2-inch meters, 30.2 percent with 2-inch meters, 5.9 percent by 3-inch meters, 4.7 percent with 4-inch meters and 0.2 percent through 6-inch meters.

The analysis determined that approximately 6.4 percent of the total loss was due to inaccurate meters.

“Our aging water meters capture about 93 percent of what goes through right now,” Kennedy said.

New meters register near 100 percent accuracy.

“The increased accuracy of the meters will pay for the cost of the meter installation,” Kennedy said.

Rainbow has nearly 8,000 service connections, and the district’s meter services staff has day-to-day customer service and metering tasks while also installing new meters to accommodate growth in the district. The removal and testing of the 333 meters required a full year due to the other activities of the meter crews, so the use of internal staff to replace 8,000 meters would not solve the problem in a timely manner. Rainbow also lacks the project management staffing to contract labor for the project.

Two Rainbow board meetings this year involved an ABM proposal which was discussed at the July 24 board meeting and approved on a 5-0 vote Aug. 28. ABM will manage the project including staffing a project management team, handling procurement of all meters and associated parts, contracting the labor with a district-approved vendor to install the meters and upgrade the water services, configuring the data on meter replacements to Rainbow specifications and transmitting the data to the district’s utility billing system to ensure smooth transitions, handling any warranty claims for damages caused by the contractor’s work and guaranteeing the accuracy of the meters for as long as the vendor guarantees the accuracy. If the meter accuracy falls below 98 percent, ABM will pay Rainbow the difference between expected and actual revenue. ABM is paying for the project and leasing the meters back to the district over a multiyear term with an option for Rainbow to buy down the lease at any time during that period.

“They approved us to start moving forward with it,” Kennedy said of the board vote.

The meter replacement under the ABM partnership is expected to be completed in less than a year.

“As part of our program we're also going to upgrade the meters,” Kennedy said. “We’re going to try to standardize our meters.”

The new meters will include a customer shut-off valve just downstream of the meter which will allow customers to shut off their water rather than using the curb stop which is difficult to operate without special tools and has more severe consequence if broken.

“This way they can handle it themselves,” Kennedy said.

Rainbow staff also requested that ABM include a pressure regulator relocation component since the pressure regulators Rainbow has for nearly 1,000 connections often fail and cause breaks in customer piping, but for financial reasons ABM suggested that the pressure regulator program be separate from the meter replacement contract. An evaluation of whether only the meters 1 inch or larger should be replaced determined that the cost of the project would only be reduced from $6.1 million to $5.4 million but would not provide the upgrades which would benefit customers with 5/8-inch or 3/4-inch meters.

The cost to replace the 7,735 meters the district had as of July 24 would be $6,106,026. The annual operations and maintenance savings of $180,000 and the annual revenue of $904,563 from additional water measurement based on 2017 wholesale rates equates to a payback period of 5.63 years. The financial model is based on 98 percent accuracy; if 100 percent accuracy is achieved as expected the payback period will be 4.5 years. The savings also does not include labor costs from normal routine meter replacements, which is approximately $260,000 annually, and the cost assumed a 3.75 percent interest rate.

ABM will use Concord Utility Systems as its vendor. The agreement includes a 10 percent profit for ABM as well as the cost to purchase and install the meters. Concord has an office in Murrieta, and Rainbow has previous experience with that company.

The Aug. 28 board meeting approved the project agreement and the meter accuracy guarantee contracts. Rainbow’s Sept. 18 meeting included a 5-0 vote to approve the form of the lease-purchase agreement through ZB, N.A. Rainbow will finance up to $5,523,284 through a tax-exempt capital lease. The interest rate will be 3.09 percent.

“It’s not free money, but you can see it from there,” Kennedy said.

The term of that lease is for nine years. The agreement only covers the cost to replace the meters.

“We’ll also be replacing pressure regulators on about 1,500 homes so we can make sure we have adequate pressure to the homes,” Kennedy said.

A separate project will replace and upgrade meter boxes, replace pressure regulators and install customer ball valves for services which do not have a backflow regulator. The Oct. 23 action approved the agreement with ZMFU II for those activities which will also include the installation of a Neptune R900i drive-by advanced meter reading radio. The agreement with ZMFU II is for up to $5,249,905 and has a 3.18 percent interest rate with a ten-year term, which equates to annual debt service of approximately $615,000.

Author Bio

Joe Naiman, Writer

Joe Naiman has been writing for the Village News since 2001

 

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