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HomeMy WebLinkAbout1957 09-05 CC ADJ MIN66 National City, California, September 5, 1957 Adjourned meeting of the City Council of September 3, 1957, was called to order by Mayor Hodge at 7:30 P.M. o'clock. Council members present Fessman, Heck, Hodge. Council members absent: Hart, Hollingsworth. ADuiINISTRATIVE OFFICIALS present: Bird, Curran, Gautereaux. CITY MANAGER BIRD stated that Councilman Hart is suffering from an at- tack of the 4flu' and will therefore be unable to be present. CITY MANAGER BIRD stated it is necessary to adopt a resolution in re- gard to the proposed increase in water rates. COUNCILG�OMAN HOLLINGSWORTH present. RESOLUTION NO. 7069 was read, expressing opposition to the increase in rates proposed by The Metropolitan Water District of Southern Calif- ornia. Moved by Fessman, that the Resolution be adopted. A. F. POULTER, Div. Manager of the California Water & Telephone Company, was present and stated that the rate increase would affect all the Metropolitan area, not just San Diego County. Motion seconded by Heck. Carried, by the following vote to -wit: Ayes: Fessman, Heck, Hollingsworth, Hodge. Nays: None. Absent: Hart. MR. POULTER stated there was a lengthy meeting this afternoon on the subject of rate increases in water and the Engineers and Attorney representing the Authority were in attendance, and the Attorney is drawing up an opening statement for a special hearing that will be held next Monday morning in Los Angeles at The Metropolitan Water District's Office. He has done the best he can to ask for a postpon- ment of this matter, and that is the best position we can hope for at this time; however, without too much assurance, we must be prepared to state our reasons why this increase should not go into effect. Mr. Poulter said he would recommend that the City send a representative, or ask him to represent them. CITY MANAGER BIRD stated that our rep- resentative to the County Water Authority, Lr. Charles Kerch, was in his office and requested that he bring before the Council authorizat- ion for attendance to be had on the 9th of this month in Los Angeles. Mr. Bird recommended that Mr. Kerch and Mr. Poulter be authorized to represent the City at that hearing, if the City Attorney is not go- ing to be available. Moved by Hollingsworth, seconded by iessman, that Charles Kerch, Mr. Poulter and Attorney Curran be our -represent- atives at the meeting on Monday. Carried, all the Council present voting aye. CIT1 b,ANAGER BIRD stated that the representatives of the South Bay Irrigation District, with their Chairman, Mr. Lee, is in the audience, and suggested that a recess be declared so that the chairs may be set properly so they can get around. the Council table. HODGE declared a recce;. The meeting was called to order by Mayor Hodge. Council members present: Fessman, Heck, Hollingsworth, Hodge. Council members absent: Hart. 9/5/57 67 MR. LEE: ''Members of the South Bay -Irrigation District, we are now in session. Will you call the roll, 'exalter, please." MR. STEELE: Helm - present Waller - present Butler - present Lee - present Steele - present MR. LEE: "Ladies and gentlemen of the National City Council, and mem- bers of our Board, we received your Resolution in regard to the items which you would like to discuss with reference to Joint Powers Agree- ment, and we are willing to discuss those items with you. However, we do not feel that we should necessarily, or have to confine our remarks totally to these, but should be free to discuss any phase of it which you might feel that would be in order. With that we are ready to dis- cuss any phase of it that you choose to discuss, if you so stipulate we can discuss any other items that you might want to." MAYOR HODGE: "I would like to interject one thought here.. I would certainly like to see you direct this meeting right down the line be- cause I feel like this: I feel like we have been working on this thing a long time, and we have a job to do, and if we wonder here and there we will never get a job done. lice done that the last few meet- ings, and I believe that it behooves this group, both yours and ours, to keep on the ball and keep going. Either do this thing, or don't." MR. LEE: "I believe, Mr. Mayor, that is the feeling of our group, I know it must be of yours, and we are ready to do just that, to dis- cuss this to try to draw it to a conclusion, if possible, one way or another. We are not reluctant to discuss these items as outlined. There are perhaps some items that we may not clearly understand, that we might like an explanation of, and want to proceed on whatever grounds we might reach a common effort. On your agenda, joint agenda here, you have ''matters proposed by National City Finance Committee", I assume you want to discuss." MAYOR HODGE: "Mr. Chairman, I would entertain a motion that we dis- cuss your part of the agenda first. After all, if we can't resolve this part of this thing, there is no use of going over the other." MR. LEE: "I don't know as I clearly understand your statement, Pike." MAYOR HODGE: "At the bottom here, you have a part of discussing Nat- ional City's Resolution No. 7057 as part of your District Board's agenda, and I think that probably that should be discussed before we go into the top part of it." COUNCILMAN HECK: 1%11, Mr. Mayor, I will, frankly I feel this, we have proposed six items and possibly some others might come up for discussion tonight within the frame work of the Joint Powers Agree- ment. The South Bay Irrigation District has proposed one item on the agenda; I certainly do feel that possibly we should take up their item first, even though it is printed last on the agenda, to see what they wish to discuss about the Resolution. I will so move, Mr. Mayor, that we move item No. 1 of the South Bay Irrigation item on the top of the agenda." 9/5/57 68 COUNCILMAN EESSMAN: "Second.' MAYOR HODGE: "Is that addressed to the National City Board, or to this group as a whole?" COUNCILMAN HECK: "Mr. Mayor, and the Chairman of this meeting, I make that motion." MR. LEE: "The reason I was hesitating here, I didn't know how to treat the motion. We are functioning as two separate bodies and through the medium of a motion takes no official action, as I see it. We might ask the advice of our Attorney; if that is the desire of this group, that is what we shall do.I COUNCILMAN HECK: 'Under parliamentary procedure, Mr. Chairman, inas- much as we are two individual bodies, I will suggest to you, Mr. Chairman, that we take up your item on the agenda first. MR. LEE: '0. K. by me. In your Resolution as delivered to us, the items which you wish to discuss, and I believe, if I recall suggest- ing that we put the items on the agenda which we wished to discuss, and the only one seemed to be, rather than the general c cnditions of the whole agreement, would be the discussion of your Resolution, and just what your intent of that Resolution was, or what do you intend by that Resolution, or what do you wish or hope to accomplish with it, and with that I ask for comment from any of our people or any of your people." ATTORNEY CURRAN: 'Well, Mr. Chairman, inasmuch as the City Attorney of National City was instructed to draw the Resolution, and the Res- olution as it was adopted was the draftsmanship of the City Attorney, perhaps it might be helpful if he could explain what was intended. Of course, sometimes we don't always come up with what we intend. We know what we think, and we get it on paper, and then somebody else looks at it, and he gets quite a different idea; so with that possibil- ity in mind, I think that from the point of view of the draftman of the jesolution, the basic point was the fact that for the past two sessions, during which the entire Agreement was read and discussed, the point on which there was more basic disagreement and a possibility of these two agencies going completely asunder was the treatment of the National City well; and from the point of view of the draftsman that was not a new problem because that was a problem that the engin- eers and the technicians and O'Melveny & Myers had in trying to re- solve the differences as to what would make a fair agreement and thingp that the Attorney for the South Bay Irrigation District and the City Attorney had to participate in; wherever there can be a meeting of the minds, and I don't think there is much doubt in the City Attorney's mind at the time we held those conferences; the one thing that might possibly hold up an agreement between our two public agencies was that matter of the National City well; and there is a lot of vital facts which were explored and there is some law involved, and we had pretty elaborate exposition of the views of the various members of the public agencies; but, of course, the views of individual members 9/5/57 69 are their views only, and it isn't the individual members that have to make this agreement, this agreement has to be made between those two public bodies. The majority of each of the bodies is going to decide as to what, if anything, goes into any agreement that's reach- ed. So from the point of view, it being the one point on which the whole matter could be held up and from the point of view of being a concession on the part of National City, at least in the minds of the people of National City, and Ittiink I explained before that it was one of the things that we had discussed in Los Angeles as to whether or not it was a concession, because you can't give away something you don't have, but never the less wears talking about something that assumes the two of us, that is the two public agencies, to acquire, and I believe that the whole intend and purpose of this Resolution, as least as to the significance, is the fact that whereas before the Finance Committee of the City Council had been delegated to act for the City, at the request of the oouth Bay Irr.gation District joint meetings were held between the entire City Council and the entire Board of Directors rather than simply be representation from the Finance Committee, therefore, the Council by action which was formal and which was official went on record and fixed and established a policy that the Council, as a Council, acting for the people of National City, was willing to concede this very basic thing, which to my mind could keep us from reaching an agreement. No matter how art- fully the Resolution may be drawn, and if there is anything that has caused offense, I certainly apologize because it was not the intent to do so. The whole thought was that National City should go on re- cord by the majority action of its City Council to agree in principle to the policy of the Joint Powers Agreement, or particularly the mat- ter of treating the underground waters and the National City well as it now is in operation the same as your overground waters so that on that basis it was felt that we could have an agreement. Now, if there is anything else that is significant in that Resolution, I think we should find out what it is." MR LEE: "I gather. First, I would like to ask, is: there any comment from any of our Board here or anyone else, any comment you want to make on this." MR. HELM: "I think that answers pretty well the question that we raised here. I did not have anything else that I wanted clarified in the Resolution.' MB. LEE: aI gather from your statement and the way it was worded in the agreement and discussed, and from the wording of the agenda here 'inserting a provision that any new water production developed by either agency and used soley and exclusively for governmental pur- poses of that agency does not become subject to this agreement', in short that is what you say.' CITY ATTORNEY CUR3AN: "Yes, the precise point raised there, Mr. Lee, is this: The suggestion has been made, I don't think it was ever made before at these meetings; suppose that Natiunal City determines that for its own use, for a park, there has been a park dedicated adjacent to the present National City 'fell, El Toyon Park. As the Agreement 9/5/57 70 now stands, National City as a user of the water, of course, would have to pay the going rate, and the production from the National City well would be subject to this agreement. In other words, the way it would work out would be whatever percentage is determined, whether it is two-thirds or sixty-five or thirty-five or seventy -thirty of that production would be South Bay water. The thought was put forth that without in any way disturbing that arrangement as to the exist- ing well, let us assume that National City wanted to venture "X" number of dollars to see if it could produce another well on land owned by the City for use of the land exclusively owned by the City for municipal purposes. Let us assume that National City wanted to expend money to see if they could bring in another well in order to take water to take care of El Toyon Park. Under the law, as I under- stand it, correct me if I am wrong, that any property owner has a right to sink a well and use that water on his own land, and that is exactly what National City would be doing in that event, and it was simply as a precaution because of the suggestion made that possibly that National City might want to do that such a provision would be inserted into the Agreement. Of course, it would not be couched in the terms that National City could do it, or it could do it in the park; because as everything else in this Agreement, it would have to be a quid pro quo, what is good for one has to be good for the other. If National City can do it, South Bay could do it, so, therefore, it is a matter of technical phraseology and in all those matters, I am sure that the Attorneys and the Engineers could work out that detail, but the same would apply if in the South Bay Irrigation District, it was felt that a new well could be developed exclusively, or suppose that South Bay bought a building, and South Bay wanted to use the water in its own building, and South bay built its own well, and it would have that water, and it would not be part of the general pro- duction, and that always depends upon that condition there.' MAYOR HODGE: ''Palm Valley." ATTORNEY CURRANT "Palm Valley or any place else, or Kimball Park, the City Hall, it could be right here too. But the basic point is that it would be new production, it wouldn't be any existing product- ion, it would be something that either agency would have to spend funds in order to produce for itself, and it would be restricted to use for either the City or for the South Bay Irrigation District." MR. LEE: For a point of information and clarification for myself, may I ask of you or Paul, isn't that now provided for in our present law?" ATTORNEY CURRAN: "I believe it is." ATTORNEY ENGSTRAND: "I think so. I agree with what Curran said about the law, that you can drill a well. Of course the thinking within this area is a little different." ATTORNEY CURRAN: "All, but the basic point is, assuming the two Attorneys are correct that that is the law, I think it is just a matter of precaution. pie have endeavored very hard that there will be no bugs, that there will be no hidden meaning, and so that it was simply an effort to bring out into the open the possibility which may 9/5/57 71 never cane to fruitation, but inasmuch as it is a possibility, I think it should be straightened out so that there is no avenue for contro- versary in the future, assuming that we have an agreement that we want to go ahead with, and live by." ATTORNEY ENGSTRAND: "May I ask a question, Bob? I take it, suppose this well that you were using water from to water the park, if water were used from that well in the system to furnish , that is not what you are talking about?" ATTORNEY CURRAN: "Not at all." ATTORNEY ENGSTRAND: "Then let me ask you another question. Due to the little peculiarity of the situation of the South Bay Irrigation District, if your suggestion were acceptable, would it be proper, take for example South Bay could have a well that would furnish part of the City of Chula Vista water." ATTORNEY CURRAN: "Yes, as a matter of fact that is something, of course, that would have to be resolved, and it would require some thinking before it was drafted." ATTORNEY ENGSTRAND: "It would take a little careful drafting." ATTORNEY CURRAN: 'The principle would be, I mean what you are talk- ing about is this: As I understand it, it is an effort to cut down the cost of water for public agencies and use, or even for your fire system; and if it is good for one, it has to be good for the other; so that is the whole point of it.4 COUNCILMAN FESSMAN: "A question, you mentioned the fire system, from a practical standpoint, how could that be? For instance, if you had a well for a park, how could water be put into the City+s mains for fire protection purposes to be used if there should be a fire, so much water being used, put that much water back in the system, how would that work?" ATTORNEY CURRAN: "Well, Mr. Fessman, I think this, that is the sort of thing the Attorneys and the Engineers spend, not hours, but days and weeks on in order to make sure that what we come up with is what we intend, and I think that is something that we would have to resolve. Off hand, I think it could probably be resolved by a meter, but we still have got our other problems, and I think we would want to check with the Engineers as to how functionally it would operate, and know- ing how it would operate functionally, how we could draft it. But, I see no problems that the technicians couldn't resolve if the prin- ciple is established on the policy level by the two agencies." COUNCILMAN HECK: " Mr. Chairman, on a point of order here, I would like to bring up, we have digressed considerably, we have jumped to Item No. 5 of the agenda proposed by the National City Council. we have suggested that we discuss Item No. 1, proposed by your Agency. I understand from the conversation that the South Bay Irrigation District and National City are proposing not to proceed the discussion 9/5/57 72 of this agenda within the framework then of the Joint Pewers Agree- ment. MR LEE: "If you are directing that question? °° COUNCILMAN HECK: "I am directing it to you, Mr. Chairman.°i MR. LEE: "I would have to answer it "no". Because I don't feel that I have the power or the authority to speak for this group. I am try- ing to act as Chairman to draw out their opinions and discussions. We are discussing the item which you mentioned, which your Attorney has very ably explained. I thi.ik it is now up to this group to dis- cuss that item further if they so desire, or go on to any other if they so desire.° COUNCILMAN HECK: "Aell, I feel this, Mr. Chairman, that if this group, National City Council and the South Bay Irrigation District, are in full agreement, that we should discuss the agenda. I would suggest then, that we start taking them item by item because there are certain subjects, I mean, even though this one item 5 might have been some- thing new, it was just a thought that we would have to discuss openly in this entire group here. But, before we start that, I mean we should determine whether we wish to confine ourselves to this agenda. I would like to have you poll the group, Mr. Chairman, to find out if we are not in full agreement to proceed with the agenda.' MR. LEE: What is the desire of this group, and if you wish I will start with Mrs. Hollingsworth and go right around. The statement as made by Councilman Heck, are we in agreement on the discussion of this agendaP COUNCILAOMAN HOLLINGS' ORTH: ^Yes°t. MR. LEE: °'Councilmen Heck," COUNCILMAN HECK: "I wish to go ahead and discuss the agenda from Item 1 on down." MR. LEE: °V Aa1t. °° MR. STEELE. "That part is perfectly all right as far, I am willing to discuss this agenda, but I do not know why we should be limited." MR. LEE: °'Charles.°° MR. BUTLER: "Yes, I'd say, go ahead," MR. LEE: "Luckie. °i MR. @TALLER: °'I don't like to see anything mandatory, and the discus- sion laid down;because I don't think we have come to the full agree- ment on everything." 9/5/57 73 MR. LEE: "Clarence. MR. HELM: 4I would like to have these points clarified, and I think now is the time to have them clarified. I would say it would be in order." MR. LEE: 4C ounci lman Fe s sman . 4' COUNCILMAN FESSI AN: 44I agree.° MR. LEE: "Mr. Mayor . 64 MAYOR HODGE: "Agreed." MR. LEE: "Well, I guess we are ready to discuss it. Let's take Item No. 1. 'Making the main 36 in. transmission line to Chula Vista, and its connecting links with the National City 26 in. transmission a part of the joint project.' Is there discussion or comment?" MAYOR HODGE: i4Do any of your Councilmen want to start that? John?4 COUNCILMAN FESSMAN: "Wait until I find the map and I'll start it. Well, Mr. Chairman, on page 2 of exhibit 2, map of this 26in. line for all practical purposes parallels the 26 in. line, or 24 or what- ever it is, different places, different sizes. If you notice, at a point about half way from the dam to the end of the line, there is a cross over; there is another, I think it is about Highland Avenue a 12 in. line, and I think in other discussions at which Mr. loulter was present, it would be necessary at a later date, in order to equal- ize the pressure in the lines between the two, it will be necessary to put a connecting line between the two lines down on the tidelands area. industrial area at a future date muhen the demand for water down there is greater than it is to date. For that reason those two lines will have to be used to balance one another, if I have the reasoning ex- actly in my mind; water pressures, etc. balancing one of the other, if one side gets a heavy demand, the other can feed it without nec- essarily having to have the water go from the dam clear down to that point. For instance, from the tidelands it can come down through both lines and feed across. From an engineering standpoint, I think it would be much more practical to have these two lines for any joint project than it would be not to have. If you notice, on the map they are almost, they are both of them largely close to the border of the two districts. The line that feeds the South Bay District is not too far from the one that feeds the National City part, and that was part of our thinking and perhaps some of the rest of you have other ideas, but that is my idea for it principally." Pohl. HELM: 44What proportion of ownership did you have in mind?i1 COUNCILMAN FESSIJ;AN: "Well, we haven't got to that. I think that is down in the next - it would be the same as the other part of the system, I would imagine. I think it is Item 2 on the agenda,brings up into that phase of it .'4 9/5/57 74 MR. "Various parts of this line feeding National City has dif- ferent ratios, don't they?" MR. nALLER: °In other words, National City would have its own trans- mission line and in addition, you would have an interest in Chula Vista's line. COUNCILMAN FESSMAN: "yica versa, you would too. You would have an interest in ours because.'+ MAYOR HODGE: "It would be both the same. In other words, it would be part of the joint owned property." MR. HELM: The various proportionments of those lines, one is 14 and 86, one is 43-57, one is 55-45, one 74-26, one is 63-37. COUNCILMiAN FESSMAN: "Those were apparently brought out, or developed by possibly Engineering or legal adviee, but it is possible that dur- ing some emergenoy or sometime the service for the tidelands area in the Chula Vista side of the boundary line there would be served from the National City 26 in. line, because the pressure on the Chula Vista side after the drop below to what it was on the other side, these other lines take up that slack. So actually they are both a part of the same system in that respect. And Mr. Poulter probably can answer that question, if it is necessary from an engineering standpoint, I guess it is, otherwise we wouldn't spend money to put those two lines together, MR. LEE: ''Is there any other comment? Al, do you have any remarks you would like to make in reference to this?° MR. POULTER: °No, I have none MR. LEE: Any of the Council of National City have anything to add to what Councilman Fessman has said?" MAYOR HODGE: "Is it clear to all you folks from the South Bay of the intention of having these two lines a part of the joint owned property, with the two lines, if theme is a leak in one, a repair job in one, we can temporarily use the other, and that is the reason it is that way. Any objection, on your part, to having this part?" MR. STELE: "It would probably require the Engineers or Attorneys to work it out." MAYOR HODGE: °It would require more than one meeting. National City has more than one line and Chula Vista has more than one line. But rather than have National City receive the water through one line and South Bay through another line, both lines should be the property of the joint owned property." MR. STEELE: ddif your connecting park line were jointly owned, it would give you the same effect. I wouldn't object to you owning part 9/5/57 75 of the 36 in. line, as far as I am concerned, because it would cost you some more money. If they were jointly owned, you would have the same situation as far as any benefits pro and con is concerned, I would think. MAYOR HODGE: That is the way I understand it is used now, the two parts are used together." MR. STEELE: °They are used together. Are the connecting links, they are not jointly owned, are they? Or are they as set out here?i ATTORNEY ENGSTRAND: "Yes.° ATTORNEY CURRAN: ''Not now It would be a part of the proposal. ° MR. STEELE: ^If those connecting links were jointly owned, that is all that it would take." ATTORNEY CURRAN: "That might well be the answer. That might be it." MR. LEE: "All of you discuss this among yourselves so that we can better understand it, get a clear understandialg of it, if we can.° ATTORNEY CURRAN: "Mr. Chairman, I think that Mr. Steele makes a real good point because if he is correct, and that is one of those things that the Engineers would want to be consulted about, he might have a simple solution which would solve the problem." MAYOR HODGE: "y'Jhat is that?0 ATTORNEY CURRAN: `That if the connecting links were jointly owned so there was no problem of inter exchange, that might be just as ef- fective as having joint ownership of both transmission lines.' MAYOR HODGE: °I get you. If the links were jointly owned, then you could cut in." ATTORNEY CURRAN: You could cut in into either." MAYOR HODGE: °How about using the be continuously pushing water back ATTORNEY CURRAN: "Those are things be consulted about.' compensating pressure, would you and forth.° that the Engineers would want to MAYOR HODGE: "It would also be used for compensating pressure, for equalizing pressure.° COUNCILMAN rES3NiAN: `'Only one objection to that, those three connect- ing links won't carry as much water as either the 24 or 30." ATTORNEY ENGSTrND: "According to the theory of the Engineers, the system should be designed and cut up, as it were, if there is going to be a cut up, should be cut up so that the system could be operated 9/5/57 76 as nearly like it is presently operated, if possible, so that in each one of these connecting links there are two valves which contemplate water going in both directions; one is going towards National City, it would be charged against your water account, one going the other way is charged against South Bay's water account. Except for that change, that is the only change that would be contemplated. As a matter of fact, the building of juds and reservoirs is supposed to help supply - keep a supply of water in National City. There has been contemplated no change in that by the Engineers. blhat the Engin- eers have tried to do is to reduce to the narrowest possible area the possible differences and consequently all of the joint ownership is tied to this one line instead of being split up between two lines, and that is the reason, of course, that National City's ownership of the one line is 84-16 instead of something else which contemplates both lines; but the need of either National City or South Bay for im- proved facilities or anything would occur at the same time, and in that line just the same as thon^h it were both lines. I know it is the Engineers thinking that this accomplishes the matter in the simp- lest way. It reduces the area of having to measure water for only arse line, etc. In other words, if both lines were jointly owned, then you would have problems of measuring the water that was being used in the South Bay, also the 36 in. line. While now all the water that goes through the 24 in. line in National City water taken off the line to serve the South Bay consumers. That is a little com- plicating feature that you have to live with. But, if you had both lines, you would have to live with it off both lines. This way it is only off the one line; and then that is the reason that this long 36 in. line is under the area that is subject to adjustment in the fut- ure. It and the booster station are the only items that are subject to adjustment in the future, and that is where your will come in." YIR. LEE: "Is there any further discussion on Item 1 with reference to 36 in. and 26 in. line? ATTORNEY ENGSTIAND: "I would just like to make one more comment. This is of course not a legal problem, and I am speaking only from what I understand.the Engineers said." ATTOOTNEY CUR AN:. "On that basis, I am wondering if the matter could- n't be cleared up by reference to the Attorneys if the principle was agreed as has been suggested by National City on Item I of the agenda, or as suggested by Mr. Steele, that the objective was achieved, then it would be a matter of draftsmanship to achieve the objective if the objective was agreed to in principle by both agencies." COUNCILWOLAN HOLLINGSugORTH: 'Mr. Chairman, I am a little confused. I am wondering if Item B "all other additions and improvements re- quired to perform this agreement, including, without limiting the generality of this foregoing", wasn't that the part, no, I am sorry, all other joint facilities; the 36 in. main is in the future, is that right?" 9/5/57 77 ATTORNEY CURRAN: ''No. COUNCILutiavAN HOLLINGS VORTH: ' Yes, but have we got it? a COUNCILMAN HECK: "Yes, it is an existing line and in full operation." MR. HELM: ''It is about 30 or 40 years old, isn't it Al?" COUNCILMAN HECK: 3What about the 24 in. line, Al? 4 vIR. POULTER: Most of that as laid in 1895 MR. LEE: 4Anyone else have anything further to add?" COUNCILMAN HECK: "Well, Mr. Chairman, I think Mr. Poulter practic- ally answered the question. I think it behooves us both, both ag- encies to go under this agreement, that we embrace both lines. One was laid in 1895 and the other in 1950 or 52, where we are both part- ners in the same project, that way we should both have the same lines." ATTORNEY ENGSTEAND: ''Let me speak for that. Leeds, Hill are well aware of all these facts, and we have discussed that point with them, and everything that I have said still - - - - and let's suppose that this line has to be replaced in five years, or two years, or some- thing, and it is a jointly owned line, and let's suppose that South Bay had no need to build a new line, and National City did have a need, now that would be, I suppose, from your standpoint, the worse thing that could happen. Now, what would happen under this agreement„ Well, the facts are that 84 percent, 86 percent of the line is yours anyway, and so if the line were replaced, you would have to bear 86 percent of the cost anyway, so the only contribution that you would not be giving the South Bay would be a 14 percent lack of contribut- ion. Now then, the key to it, from the Engineer's standpoint, the reason South Bay would not back is because under the con- tract each agency has capacity lines limited to their ownership, so South Bay only has the right to bring 14 percent of the water that comes through that pipeline to it, The fact of the matter is that South Bay takes more water through there than that because of the fact that National City gets so much of its water presently from the National City well. So, it would behoove South bay, there would be a community of interest to go into a joint discussion project, and even if they didn't go into the joint discussion project, the 86 percent of ownership of National City would still be to National City's in- terest to replace the line and charge bouth Bay 6 percent interest on the rest of the 14 percent, and, of course, in calculating these percentages of ownership and dividing it up, the zngineers have given credit or taken credit away for the estimated value of the line. It is 86 percent value of the north line is to be assumed is less than 86 percent value of the other line, and the Engineers have taken that into consideration, I don't know whether they have done it correctly or not . u 9/5/57 78 COUNCILMAN HECK: °In other words, Mr. Engstrand, let me get this straight. Supposing we assume, on the basis this agreement is now made, that National City buys a 62 year old line, constructed in 1895, South Bay in the purchase, of this, purchases a five year old line; now then, in five years hence from now, after the sale is con- summated and in operation, this 1895 line, or 67 year old line went out, we would have to assume then to replace those lines 86 percent of the construction cost.'' ATTORNEY ENGSTRAND: i'If you were going to maintain the same owner- ship as you presently have in it." COUNCILMiAN HECK: °Well, frankly, Pair. Ehgstrand, you are all business people here; that is probably the reason for Item No. 1 on the agenda. Letts be honest, are you going to compare a 62 year line against a five year old line. Let's be blunt and honest about it. MR. ¥ALLER: °You are only paying for a 65 year old line in your condemnation, so that it does not make a bit of difference.' ATTORNEY ENGSTRAND: "That, of course, has been taken into consider- ation by Leeds,Hill, and, as Mr. Poulter points out, the line was re - cemented in 1949, and I forget what they estimated, the Engineers estimate a cement relining line is, about 15 years, don't they Al, something like that?'' MR. POULTER: ''Another 50 years at least. ATTORNEY ENGSTRAND: 4'But whatever it is, I know that they have taken that into consideration. ° ATTORNEY CURRAN: ''But the answer to that goes back to the basic principle which perhaps we are forgetting, is that each party is going to pay in the end a lump sum, but that lump sum is cumputed from a number of various items; and they each have a certain percentage so that there isn't any question with what Mr. Steele suggests that South Bay would be very happy to let National City at this time pay a greater share, and that is what you would have to do if this was adopted, but the reason for that is because of that formula which is that you pay on a percentage basis which is the estimate of the En- gineers to the value proportionally to the total project, and nat- urally an old line isn't nearly as valuable to the total project as the new one, so I think that is one of the things that makes this agreement appear to be very complicated, but the reason was that the draftsmanship had to be that way in order to have a basic principle which was equitable." COUNCIL4aMAN HOLLINGSWORTH: '+Mr. Chairman, may I ask Mr. Fessman a question?s' B. LEE: 't Y ou may . COUNCILWOMAN HOLLINGS1JORTH: w r. ?essman, I believe the idea of this 36 in. line was your idea from the Mohr Adams Plourde report. J:uasn't there something brought in on that report2t' 9/5/57 79 COUNCILIAN FES uAN: °'Only that it would be necessary to tie them in together when the tidelands is developed, make another tie in there, probably put another 18 in. line or something down closer to the Bay." CGUNCILv LEAN HOL[ INGSC4ORTH: 40uell, couldn't that be done by a meter?" COUNCILMAN FESSMN: 4Sure, it wasn't my idea to bring up this 36 in, line on the Committee. It was somebody over there.' ATTORNEY ENGSTRAND: "Now, under the agreement as it exists, suppose down here, at the end here that Mr. Fessman is talking about some place, there vould be another need for a (cross tie?); under the terms of the agreement, let's suppose that South Bay had no interest in building that, wouldn't contribute to it, then of course National City would be entitled to build it themselves, and they would be entitled to the sole use of it. If South Bay used it, they would have their penalties and share the costs. MR. HELM: 4Mr. Chairman.4 MR. LEE: Clarence. MR. HELM: Our agreement, it would be better to own it jointly, but that is another argument for single ownership and operation. As long as we are discussing a joint venture here, it seems to me we would have to go along with the Engineer's recommendation for joint operation. a MR. LEE: Are there any other discussion with reference to Item 1? If we have discussed that and explored it as far as we choosed, do you, are you ready to go to Item 2?4 COUNCILiVAN HECK: °iI do think, Mr. Chairman, possibly we ought to reach some agreement with our group here tonight as proceed on this agenda so that we know that we are making some progress towards ul- timately bringing this thing to electorate. Maybe, possibly, there should be some agreement by poll, It can't be official, but I mean by some comments whether the South Bay Irrigation District and Nat- ional City Council are in agreement whether to make this part of a joint agreement or whether to leave it as the Engineers previously recommended or take Mr. Steele's proposal. MR. LEE: "It is doubtful; I am trying to rationalize the thinking when you say that we should agree; I don't know whether we can or cannot agree on any one section which might have very direct bearing on another. I believe the Engineers who worked out these formulas were very well qualified in their work. If we are going to accept one phase, probably we should accept them all. However, I feel that, to say that we ae at an agreement on this item as it may pertain to the Joint Powers Agreement, I don't know that we are ready to do that, even though we go back to its original state. If you have some defin- ite idea in mind, that you would like to put forward, we might try to vote on it." 9/5/57 80 COUNCILMAN HECK: 4No, Mr. Lee, the whole thing was this, we were trying to, I believe, that National City to make progress, we have had a couple of meetings, and to bring this thing to an ultimate con- clusion which we are, both agencies were obliged to do so. use are both representatives of our citizens; both agencies have spent an awful lot of money to make the progress we have now made, and I think it behooves both of our agencies to bring this to the quickest pos- sible conclusion, and the conclusion is by our agreeing here to the basic problems. We read in its entirety, the Joint Powers Agreement, our Attorney has made some corrections as we discussed it, there has been a few questions that have arose in our minds, and this meeting tonight is probably the culmination of the last two meeting of the reading of the Joint Powers Agreement where we have all asked quest- ions. I know the National City Council has had questions. That is why, I believe tonight, our agenda is proposed. But, I do feel that possibly this should be a meeting at which we could come to an agree- ment of minds here, tonight, and if we are in agreement, there is give and take on both sides. I believe our last meeting we discussed the - National City felt that they should have the underground water from the National City well. Since that time, as outlined by our Attorney, we have decided for the sake of cooperation that we would disband with that idea. But we also, in full spirit of cooperation, I think tonight we should reach some agreement so that if we could finally go through our questions, and frankly this agenda is not limited to just our questions. South Bay Irrigation, I am sure your members must have some questions too on the Joint Powers Agreement which within the Joint Powers Agreement you would probably like to discuss tonight, and then possibly we can reach a solution tonight. If so, then we can proceed with the final determination drawn up by our Attorney so that we can present it to the electorate,and then we will have a discussion whether we should present it to the elec- torate first or whether we should proceed with condemnation first. We have both spent so much money that frankly every month we delay, and there have been an awful many months, in fact we are in the years delay, the, MZr. Poulter can certainly bear me out on that, the value of the Water Company has so enhanced in value it is going to cost our electorate more money as it is now for the delays that we have already encountered. I think we certainly, everyone of us were obliged to give our citizens, whom we represent, the opportunity to determine whether they wish to purchase the Water Company or remain under the private ownership of the California Water & Telphone Com- pany. And that, Nor. Lee, is the only reason tonight I feel that as we go through these various items on the agenda that we should try to reach some agreement. True, we both have disagreements, but I don't know how important it is, and if it is a matter of bringing these points out to air them out to find out what everybody's feel- ings were on the matter.' COUNCILMAN PESSLAN: "Mr. Chairman.' Mr. LEE: it Mr. Pessman.:; 9/5/57 81 COUNCILMAN FESSMAN: "I would like to inquire of either Attorney. This proposal, as I understand this agreement here, the South Bay Irrigation District will operate the joint facilities. Now then, that being true, its incumbent upon the South Bay Irrigation District to supply water through these facilities. Now, as I understand it, this .04 in. pipe line is 14 percent owned by the South Bay Irrigation Dis- trict and 86 percent by National City under the proposal, and I am not sure, but I think the other one has a slight joint ownership too, doesn't it?" iia. LEE: "As I recall, I believe that is right. Paul do you remem- ber?" ATTWNEY CUiUAN: "100 percent". COUNCILMAN FESSMAN: "All right, suppose it is 100 percent South Bay, but is it still incumbent upon the South Bay Irrigation District to supply water to the National City line through these equalizing lines in case of failure of the 24 in. line or in case the capacity is not great enough; and vice versa, the some thing would apply if failure of the 36 in. line, National City's line to pass water up to the 32 in. and the 10 in. and the 12 in. line to supply the South Bay Dist- rict. If that be true, I wouldnIt see that it made any difference whether National City owned any part of that 36 in. line or not. ATTORNEY ENGSTRAND: "That is the sum substance, the underlying principle. The joint operation by South Bay is the duty they have, along with their responsibility they have the duty to maintain it, repair it and see that it furnishes water adequate for the need, that demand water from that line. The thing that I have been talking about is in the event if they don't do what they are supposed to do then what can you do. That is the reason I talked about National City having to go in and build or do something. That's presupposing that South Bay for some reason or other has failed to do what they are supposed to do." ATTORRNEY CURRAN: "Paul, I believe you are right. Of course the duties and obligations, etc. are spelled out. However, I don't at the moment recall anything that specifically states, and it might be that Mr. Fessman's point is that we should have a little clause in the agreement as part of the administration of the joint facilities that the obligation to deliver water to the lines is there. That would be a simple matter. ATTORNEY ENGSTRAND: "It might be well to have that." ATTORNEY CURRAN: "It is assumed, but it is not explicit." CCUNCILIM,AN FESS1 AN: "From a practical standpoint, suppose the pres- sure dropped 50 lbs. on National City's side, and there was a 100 lbs. on the South Bay side, then the water automatically would just float to the 12 in. line, the 10 in. line and the 32 in. line into National City's side, or vice versa, and it would be measured then by meters in those lines whichever way the water happens to be flow- 9/5/57 82 ing, and whichever agency was receiving the water would pay its bal- ance off each month and would pay for it, just the same as those meters that you would the one up at the dam. So, I can't see that it actually makes a whole lot of difference unless there is something that needs clarification.' MR. HELM: 'I would like to point out Mr. Steele's mention about these interconnecting lines. There are three interconnecting lines". ATTORNEY EN STRAND: °There are at the present time, yes.' MR. WALLER: 'Under this agreement here, those three connecting lines together with the owned 64 percent by South Bay and 36 percent by National City comes pretty close if you figure it out." MR. BUTLER: "Under discussion, we have had so fax No, 1. It seems that we all have a great deal to learn about engineering problems and the ramifications of this contract. The only people that seemed versed in it are the Attorneys and Councilman Heck seems very much concerned with the time element, getting on rith it, etc., and I am just wondering and for the sake and maybe saving some time discussing things that we don't seem to know too much about, at least I don't seem to know much about, and some of you sEem to be in the same shape, could we agree to accept this Joint Powers Agreement, as read, and as corrected by Counsel, as agreeable to both parties. Forget everything else but what Counsel has written, the result of Leeds report that we have read here, can we accept this document right here and pro- ceed from there. That will be a time saver, and you can get this report to your public if that is agreeable. Your Counsel and our Counsel have agreed on it. We get into engineering problems, we get into this and that, I donut know anything about, maybe you do, but I don't know too much about it." MR. WALLER: 'I don't know too much about engineering. The engineers have drawn this up, and it appears to be fair, the way it is drawn, We are discussing things that are way over my head; I can't see what difference it makes.' MAYCR HODGE: "I think you are an the right track. I think that is the thing to do. Then each one of these questions here.' MR. WAILER: 'They are automatically resolved.' MAYOR HODGE: oNo, they are not automatically resolved, they are still.' MR. WALL R: "They would be if you were to accept it. MAYOR HODGE: "If we were to accept it, yes, we want this accepted but with certain things brought up and discussed and possibly some changes made." MR. WALLER: ''In other words, you will not accept this document, as read? 9/5/57 83 MAYOR HODGE: °1I don't think you would either. That is the prin- ciple that we want. °i MR, wALLEER: 4But you won't accept the framework. With your modif- ications. ° MAYOR HODGE: °°With both our modifications. We want to talk over some of the things and these are some of the things to discuss that are on our agenda, that fell within this framework. This is the frame- work. °i MR. WALLER: °iI propose we accept it as is. Now we can vote that down very easily and very quickly if you want to call a vote or if you want to call people. I propose we acre t it as is without any deviation at all . ° MAYOR HODGE: °°I don't think that would be wise because that was not given to us as a definite thing. That was given to us as a proposal for us to discuss and change, etc.; but the framework, the general idea of the thing is the thing that we want to follow. There are same things in it that we want to change . ° MR. WALLER: °iI understand that there was an agreement between your Counsel and Our Counsel on the substance.. I don't want to be quot- ing Counsels here, but I understood it might be acceptable in the present form. °° ATTORNEY CURRAN: °Mt . Mayor, since that seems to be directed to the Counsel, I think this: I think that on the agenda here, No. 6, the arbitration was pretty well discussed and agreed to at the last time. No. 5 is a minor matter, that is by way of precaution and probably in agreement already. No. 4 is something that has arisen; that is the non -assignability. No. 3, the treatment plant has been discussed and was left open, and, of course, No. 2, the percentage of ownership originally was intended to be left open, Mr. Waller.°° MB. uALLLR: °1As I understand, the way that was set up was 70-30, and we agreed for bookkeeping purposes that 2-1 would be better.°° ATTORNEY CURBAN: °'That is just about it.° MR. °WALLER: °iThat is a very small item here.°° MAYOR HEDGE: °°That is what I mean. °i MR. WALLER: 1°That is the only item I can think of, and I think we would be agreeable to 70-30. I can't speak for the whole Board, but I think we would go letter for letter and word for word, because we are just as anxious as Councilman Heck to get this going. He ment- ioned it two or three times about getting it out.°° MR. LEE: i°Anyone Else i °° 9/5/57 84 ATTORNEY CURRAN: "Is your proposal, Mr, Waller, than that the few items here that should be discussed be agreed to, and then the At- torneys be instructed to come back with the final draft? That is really what you mean, isn't it?" MR. WALLER: "My whole quastion is to ask the Chairman, in the inter- est of expediting it, to poll the members. If they will accept this, as this, with the possible exception of the 70-30, or the 2-1 for bookkeeping, to take back to the respective bodies the final sub- stance." ATTORNEY ENGSTRAND: May I interject one thing, Mr. Waller. You remember that in this agreement, as presented, the treatment plant is a mandatory provision, and I was wandering if you feel that that should be discussed, or not." MR. WALLER: "It seems like we get into engineering problems, we get into this problem, we get into that. I don't understand them, and I don't think a lot of your boys do." COUNCILI'uAN HECK: "I don't. I am no engineer." MAYOR HODGE: The problem is this, we want to accept it just ex- actly like you say except that it was given to us as a frame with which to discuss and change; but the framework is there, and I would certainly go along accepting that; but not absolutely like it is, but in the framework, and I think if you should accept that, it should be with changes that should be discussed among us." MR. WALLER: "I don. ' t want to make a motion, but I can see this is going on and on. The only thing we can do is have faith. We haven't faith in ane another. we have demonstrated that. We are all pick- ing at one another here, picking on one another. +e seem to have faith in our Counsel, they have drawn this. Now either let's ac- cept what the Counsel says or else keep on wrangling." COUNCILMAN FESS AN: "Mr. Chairman, I agree, except that I think that these items 3, 4 and 5 should be understood by everybody in here, and possibly the time schedule for building a treatment plant is mandatory in the agreement. We ought, perhaps, understand when that might be commensed as far as the operation of the construction of it. Items 4 and 5, those are provisions that we agreed to or not agreed to, and there is no great problem in either one of those.' MR. LEE: "I think we are all anxious to reach a conclusion. Sit- ting here as your Chairman, I want to do it the way you want it done. If you want to continue to work an the items as proposed in this agenda, we shall proceed. If you want to work on the contract, as now drawn, eliminating the treatment plant entirely for future dis- cussion, or including it as is, it is up to what you people want to do. I will try and act accordingly. I think each and everyone of you know my feelings 100 percent.' 9/5/57 M YOR HEDGE: "Kell 85 have we done anything with item 1 on the agenda?" IvR. LEE: "Yes we had a lot of discussion." MR. BUTLER: "I don't know any more than I did before we started." MAYOR HODGE: "I would say then, Er. Chairman, that we skip and go to item 2." COUNCILMAN HECK: "Mr. Chairman, I think that possibly we could eliminate this item 1. I believe, as far as I am concerned, I am certainly no engineer, never have been, and had a difficult time in physics and math myself, but frankly I feel that if the Attorneys would, I believe among themselves clarify the intent that in the event that our, and that was my one thought was that our transmission line was old, and if the line went out, I was concerned as to how National City was going to get water. I think it was clarified, and I believe it can be done by both Counsels very simply. I certainly feel that item 1 is accomplished," IVIR. LEE: "Would this body be willing to withdraw that. Do you want to continue on this basis?" MR. BUTLER: "I don't think there is any doubt in anybody's mind that if the line, either one, went out, that water would be served. If we can get away from engineering and discuss some of these other items, I think we can get ahead further; we are not too familiar with an engineering problem." MR. LEE: "There has been a lot of discussion here for the very best interest. However, as it has been said, we have been discussing a problem that few of us are qualified to, not only hassle, but to deal with. I think that if we are going to sit here and debate engineer- ing problems, we will be here for a good long time. what do you want to do with your No. 1?" COUNCILUtiN FESSMIAN: "I move that we pass on over No. 1 and accept it as the agreement takes care of it." MR. LEE: "In effect would you withdraw this No. 1?" COUNCILMAN FESSIv N: "Yes, because I think the agreement takes care of that. That question asked a while ago that either body is oblig- aged to provide water for the other in case of failure of its line, and they certainly are, morally at least. And the meter is in be- tween them that water, and if the water has to be metered every day, I don't see any reason for that." MR. LEE: 'There are, I believe, a couple of items here which prob- ably should be discussed. oihich should come first, I don't know. I am going to leave that up to you gentlemen. You have here the proper percentage of ownership and the time schedule for building a treatment plant. To me that is about the two most important items. 9/5/57 86 The one down here about the arbitration clause, whether it should be permissive or mandatory, I think we all understand, the type- writer just made a mistake. Inserting a provision that any rights of property acquired is one that might be debated, but I think this 2 and 3 is the items we should try to settle, and if we are then, whether we are then.' IVIR. WALLER: ''Counsel could, Counsel is in consensus of opinion on it, didn't you Counsel when you said it was 70-30 and 2-1 for book- keeping purposes, isn't that the feeling of both you and our Attorney? ATTORNEY CURRAN: °Well the . as MR. WALLER: `aWe can get over it rapidly if you two boys agreed, and we agreed with you boys instead of agreeing with each other." ATTORNEY CURRAN: "Yes, well the." ATTORNEY ENGSTiAND: "I was going to say, as we have said before that 70-30 was the recommendation of the Engineers, 2-1, as Mr. Waller points out is for easier bookkeeping, and I don't think there is any- one that has a crystal ball to know which one is exactly right." ATTORNEY CURRAN: s'That is right, it could be either one IviiR. LEE: "Well in order to try to satisfy everyone then on this item, does someone have a figure to suggest. " MR. BUTLER: aaI would like to suggest one-third - two-thirds as fair.a' MR. LEE: Any comment?'a COUNCILwOMAN HOLLINGSwORTH: °Would that be 33 1/3 percent as ag- ainst 66 2/3 percent?" COUNCILMAN HECK: 'aTwa to one.aa COUNCILS OM .N HOLLINGSWWORTH: 'I was the one who came up with the 35 percent with the 65 percent, however, for bookkeeping purposes. COUNCILMAN FESSMvAN: a'Mr. Chairman, Exhibit 1, Part 3, Item E, Water nights in National City Well. Title held by National City, percentage of total value zero, percentage of ownership South Bay zero, National City 100 percent . Does this mean that we are arguing for something for nothing here, that the water rights from the well are 100 percent National City's?a' ATTORNEY ENGSTRAND : That requires some redrafting, but the owner- ship is 100 percent National City's. uv'hen you take the water out there is credit given.aa COUNCILMAN FESAN: a'Yes, but why should National City own it if they don't get the water rights, or get the water out of it?'a 9/5/5'7 8'7 ATTORNEY CURRAN: 'That does require redrafting a little, there is no question about it... COUNCILMAN FESSMAN: That would be a 2 to 1 - ownership of the well would be 2 to 1, like the rest of it. IVMB. BUTLER: °YThe well is yours, but the water that comes from the well - - -". COUNCILMAN FESSMAN: "Who maintains the well?" ATTORNEY CURRAN: "You do, National City." ATTORNEY ENGSTR?ND: You made a statercnt that the maintenance COUNCILMAN FESSMAN: "That is all right then, just as long as it stays one-third - two-thirds," MR. LEE: "Gentlemen, let's try to stay on iais, if we can. Can we made a decision? It has been suggested one-third, two-thirds, and that we follow the suggested, I guess you would. call it, percentages as outlined by our Engineering firm." COUNCILmAN HECK: "Well, Mr. Lee, I will, if you want to poll the group here, I certainly feel that two to one would be a very good deal, in other words, under &hibit 1, Part 1, percentages be 66 2/3- 33 1/3 and be done with it, and for bookkeeping two to one is a very easy method." MR. LEE: "Any other comment?" MR. HELM: "I think that 33 1/3 is fair, but I would like to one- third and two-thirds because it is easier to compute." COUdCILMAN HECK: "Mrs. Hollingsworth thinks 45-55 is fair, but is willing to go along.1° IViR. LEE: 'In order to try to reach a decision on this, will we do it by poll; whatever we do will be unofficial anyhow; it is just the thinking of this group.°1 MA OR HODGE: "Just call for ayes and nays, and if it isn't unan- imous, then call for a poll." vR. LEE: "Let's say then that those in favorof the one-third Nat- ional City, two-thirds South Bay, please signify by saying aye . " AYES: Unanimous. MR. LEE: "Contray no. Looks like the ayes have it. Let's go on then to the time schedule for building of treatment plant. As has been pointed out, it is now mandatory under the terms of the agree- ment that a treatment plant be built. :gnat is your pleasure?" 9/5/57 88 ME. BUTLER: °I would like to see a certain time set. There is go- ing to be a great deal of expense if this thing is accomplished, and rather than that be constructed at once, to get on our feet, and possibly, if might be possible to accumulate some money to put into that in a certain time rather than to start it at once" MAYCii HODGE: The changes to be agreed upon at a later date? MR. HELM: ''My idea was to put it on the ballot as a separate issue." MAYOR HG GE: At a later date." ATTORNEY ENSSTRAND: you don't want to confuse the layman. You don't want to be in a position of people voting on that and voting down CI MAYOR HO,DGE: That is like. a Democrat getting nominated on a Re- publican ticket." MR. HELM: °ell, Paul, that is if they vote on this agreement, wouldn't that automatically- defeat the? ATTORNEY ENGSTltVND: 'You could frame your proposition in that fash- ion, that is you can frame, you would have to frame a proposition that would say, all that is necessary to say, you would put an "if Prop- osition A carries", you could frame it that way.' COUNCILWON, N HOLLINGSWORTH: 'Mr. Chairman, supose one group de- cided they wanted a treatment plant, and the other didn't want a treatment plant, that should be considered, and also it seems to me that in Section 6 of this Agreement something has to be decided 'that acquisition price of the California Water & Telephone Company should include the price of the treatment plant'. MR. LEE: That is what we are going to have to hurtle after we de- cide whether we want the treatment plant, or not. F' COUNCILMAN PESSMAN: niait until they build one first. We have to wait until they build one, the Water Company builds one, they don't have one." COUNCILii)MI,N HOLLINGSWORTH: "In Section 6, Acquisition of water Pits, Construction of Treatment Plant and Additions, as to whether you should have construction of the treatment plant included with acquisition of the California Water & Telephone Company, or not." ATTO3NEY CURRAN: "That is a good point, I think, Mrs. Hollings- worth, in draftsmanship. Actually Mr. Engstrand and I aren't too happy with that. I think that should be cleared up. It is something we have discussed; in fact we weren't certain in our own minds as we would like after the revisions. You recall we did make suggested revisions. I think that needs a little work.' 9/5/57 89 MR. LEE: “If this group is desirous of laying the treatment plant to some later date, the framework on the agreement could remain the same. We would be just changing the time schedule, so to speak, and then we could proceed with that item. 0 if it is desirous to put it to a vote and let the people decide whether we do or don't." MR. WALLER: 'I will go along with Mayor Hodges proposal, that we wait a certain indefinite date." COUNCILMAN FESSMAN: And. that would be mutually agreed upon, be- cause the people of the South Bay Irrigation District would vote for it, and National City against it. we could both go ahead and build it according to this agreement; National City would still be stuck for its share of it. MR. LEE: "In order to try to dispose of this, the Mayor has just suggested that it be put off until some later date, and then be mut- ually agreed by both parties, it must be an unanimous agreement. Is that the way you want it? A majority agreement? How do you want it?" MAYOR HEDGE: 'It would have to be unanimous or South Bay could go ahead and build it and National Uity wouldn't have anything to say about it. MR. LEE: "Unanimous as far as Boards are concerned." ATTORNEY ENGSTRAND: "That would be mutual." MAYOR HODGE: "Yes, mutual." MR. LEE: "That is all I wanted to clarify. Now, are we ready?" COUNCILMAN HECK: "Mr. Lee, I want to clarify this. When you say later date, are you going to put in a time limit, say within five years, ten years?' M. LEE: "According to the Mayor's suggestion, no." �J OR HODGE: 'Whenever you or the people, or we, or somebody feels that it is necessary or we can afford it." COUNCILMAN HECK: "For sake of operation as proposed in this Joint Powers Agreement, revenue bonds were voted and the purchase was con- summated, who then would determine when the treatment plant would come into use." MR. LEE: .These two bodies, or whatever two b odies.were then in power; these same people or other people, but the same two bodies." COUNCILMAN HECK: ''As I take it, under this Joint Powers Agreement, the South Bay Irrigation District is the managing director, or man- aging partner of the operation, and they have full administration of 9/5/57 90 it. Would it be then if National City said they wanted one? We don't have any voice in the administrative operation of it. ° MR. LEE: 'According to the Mayor's suggestion, it is to be delayed until a later date until agreed upon mutually by these two bodies. The administrative head would have nothing to do; it would be just a mutual agreement by these two bodies.' MAYOR HODGE: "Itwould probably be a separte bond issue anyway. COUNCILMAN HECK: "Mr. Lee, I was going back frankly to our Leeds, Hill and Jewett report where it stated there on Page 35 "it is ant- icipated that construction of a water treatment plant would be de- ferred until it could be paid for at of surplus, thereby avoiding a second bond issue", and I was thinking along the lines of the Joint P givers drawn up by our Attorney here, possibly we should put in a time, because after all, as Mrs. Hollingsworth pointed out at prev- ious meetings here, we have to go out and sell this project to our people, and we are going to sell them two things; One or two things, we are going to sell them either cheaper water, or sell them, I won't say clean water, treated water, those are the only two things we are going to have to sell. So I do think in this Joint Powers Agreement we should have, the way it is now drawn up, within a period of time, not let it go indefinite so that at sane future date without a time limit specification inserted in there.' MAYOR HODGE: You can put in that it be brought up annually if you want to. Then every year it is brought up and discussed, and either turned down or not." COUNCILMAN FESSMAN: °Well, I feel it is too soon, frankly, because as Mr. Butler pointed out, after all, when we acquire part of this system, it is going to be a tremendous operation to switch over to operate it, and there is going to be a lot of trial and error met. It isn't going to run, probably, into a money making proposition right off the bat. We should, of course, consider building a treat- ment plant out of surplus, but it should be discussed,definitely written in this agreement within a certain specified time.' MAYOR HODGE: "I think after we have had a year to get set and a year for getting then you can talk more intelligently on it." COUNCILMAN HECK: ''Before I voted tonight on that, I just, at some future date, I don't think that is quite the - I think that should be spelled out in the agreement here." MAYOR HODGE: "For the discussion, or for the future, just a date set out, that it be brought up.° COUNCILMAN HECK: "I don't mean execution because frankly we are completely in the dark how it will go. 9/5/57 91 MR. LEE: i°uuould you like to have the Mayor add to his suggestion that it be brought up annually for discussion. Annually, I assume it would be by both bodies, by mutal agreement. Are you going to buy milk, or are you going to buy water? It has been suggested by the Mayor and an addition suggested that the building of a treatment plant be delayed to some future date, but brought up and discussed annually by the joint board, and when agreed on mutually by those joint boards that they proceed with the treatment plant. Is that about the way you want it? All those in favor signify by saying aye.° AYES: Unanimous. MR. LEE: °°Contrary, say no.i° MAYOR HODGE: F°We are getting right along.° MR. LEE: °°Yes, we are down to No. 4 now. Do you all have an agenda before you? that is your pleasure on item 4? Let's have Bob ex- plain it. °° ATTORNEY CURRAN: t°The thought is this: Assuming that either public agency should either be annexed to some other agency, or be dis- banded, or for some reason go out of business, then rather than the agency which supersedes the presently existing agency, be it National City or be it South Bay Irrigation District, acquiring the right, either by operation of law or by contract assignment rather than let- ting that happen the thuught is to be specific. Let's assume that National City were to be annexed to San Diego; rather than having San Diego acquire the rights of National City in this contract, it would be clear that that annexation could not accomplish that pur- pose, and that either by some adjustment in ownership or something that would have to be worked out, that South Bay Irrigation District would at least have a first claim to acquire National City's water rather than•. IVIAYOR HODGE: "National City's joint owned.f° ATTORNEY CURRAN: aRight. ATTORNEY ENGSTRAND: "I call that the annexation insurance policy.1° MAYOR HODGE: 4So that the survivor has an option to purchase.16 MR. LEE: "A buy and sell agreement between the two parties, whereby, we jointly own facilities, not the individually owned. Any other discussion? Do you have anything more to add to or take away?a COUNCIL'udCMAN HOLLINGS 4 BTTH: ''It is just like a partnership, the survivor's partner would have first option..° ATTORNEY ENGSTR ND: °°JNell, there is a lot of merit in what has been discussed, but I think from a practicaL standpoint you have the old problem that actually these public agencies, you get to thinking 9/5/57 92 that five men represent the City of National City, kind of represent something like a partner, like you say, etc., when actually you don't, you are just trustees for the water consumers, and let's just suppose that National City were annexed to the City of San Diego, certainly the people residing within the present boundaries of the City of National City want to continue getting water through the s`me pipes, in the same manner until some other means was pro- vided them. I even question the legal ability to draw a contract that would not give them the right at that time to continue getting water from the same facilities that they had always gotten it.' MAYOR HODGE: 'That is true, but still the surviving partner would own it. I mean the same, in other words, if National City annexed to San Diego, the South Bay would be the managing body of this joint owned property, the acquisition, etc., and then National City, as part of San Diego, would buy it from them, but if on the other hand South Bay annexed and National City didn't, then the only thing that would happen would be that National City would take over the manage- ment. ATTORNEY ENGST:LND: ''I see what you mean. chat you are saying then is that if South Bay would have an option to buy out National City, then National City consumers would become consumers of South Bay just like the consumers of the California water & Telephone Company at the present time. I doubt that this Council of National City could give an option to South Bay to purchase their interest in the water system at any time.' COUNCILMAN FESSMAN: 'If that happened, there probably wouldn't be any Council of National City and the City of San Diego would no doubt insist on operating their own water system in their own ,an- nexed territory." ATTORNEY ENGSTRAND: 'This presents some very interesting legal questions.' MAYOR HODGE: ''Suppose, for example, that South Bay was annexed, it could be, and then San Diego would take over your position right there. You would be non existing nearly, and then we would be part. We would be dependent wholly upon San Diego." ATTORNEY LNGSTRAND: ''You would be in the same position in San Diego as you are in South Bay." MR. LEE: 'You would be exactly in the same position." ATTORNEY ENGSTRAND: "You couldn't be any worse.' MR. LEE: 'You would have more water to draw upon at least. As I understand -it, if they were annexed they would acquire this agree- ment just as it may stand at that time. And you'll be in exactly the same position with San Diego as you were just previously with South Bay.' 9/5/57 93 A1'TORNEY ENGSTRAND: "The annexation of South Bay to the City of National City would not do anything to the water situation by reason of the annexation. Now, there are people that disagree with my opin- ion. At least that is mine, and it is considered. Now as far as annexation of National City to San Diego, I am not informed an that." ATTORNEY CURRAN: "Well, I think Mr. Lee, that you are correct, but neither agency could lose anything it had by the action of the other agency, that is clear. But the attempt here is to improve the pos- ition of either agency in the event of such , and I think that IVIr. Engstrand is probably right, there are a lot of legal quest- ions involved, and I think the matter could simply be either agreed to or not agreed to, if possible, as it is going to require some legal work. ATTORNEY ENGSTRAND: "Let me state, if that's your position, this group could do this: Say if it is possible, legally, and makes sense and we can come back and talk to them about it later; if it is pos- sible, legally, to improve the position of the surviving partner, let's call it, then it is the desire of this group to do it, is that the thinking?", COUNCILWOMAN HOLLINGSWORTH: "Mr. Chairman, may I ask a question? '[hat would happen if the South Bay Irrigation District and National City -do not purchase the California Water ec Telephone Company, and say Chula Vista or the South Bay Irrigation District decided to annex to San Diego, just where would the California eater & Tele- phone Company stand?" ATTORNEY ENGSTRAND: "Just where they are today. COUNCILw1vL.N HOLLINGS:+ORTH: ''That is just what I an trying to get out. Now, say the voters of National City went to the polls and voted to annex to San Diego, you remember it would have to be done by a vote, then would San Diego automatically get National City's Colorado allocation." ATTORNEY ENGSTRAND: "Well, I would expect so, but I haven't studied the results of annexation of cities to cities, although I have studied the annexation of areas to cities that involve irrigation districts." :s MR. LPL: "Is there any way we might encourage that?" CCUNCILWoMAN HOLLINGS FORTH: "No, I wouldn't want it, they'll have to carry me out." IM;R. HELM: "What happens if either agency goes broke and can't pay the bonds?" ATTORNEY CURRAN: "There is a covenant; the bonding people take care of themselves. 9/5/57 94 MR. LEE: dThey seldom lose. Where are we an this 4 now, do we want to have our Attorneys draw it out." MAYOR HODGE: t°We can give it to our Attorneys and if they can see any benefit by either surviving partner, it should be brought back." MR. LEE: "Is everyone satisfied with that? If you are, please signify by saying aye." AYES: Unanimous, MR. LEE: °'Contrary, no. No. 5 °iinserting a provision that any new water production developed by either agency and used solely and ex- clusively for governmental purpose of that agency does not become subject to this a;areement. I think we were onthat subject once fe- fore." MAYOR HODGE: ;q'de have got two new parks out here we are dedicating and -we think we can dig a well." MR. LEE: 'May I ask Counsel if that is now covered in our present laws." ATTORNEY CURRAN: "Of course we evening, Mr. Lee, and I believe and by giving a specific clause ency cannot raise a question of resolved, it is spelled out. have discussed this earlier in the it is; but 'think it is precaution then future members of either ag- possible disagreement because it is MMAYOR HODGE: "In other words, I think that was one of the reasons that the well was sold, was on accout of they thought otherwise." MR. HELM: ''By the same token then, any owner of property can build his own well". ATTORNEY CURRAN: "Mr. Engstrand and I believe that to be the 1aw.4 IviR. LEE: ''You don't agree with the Water Company?" ATTORNEY LNGSTRAND: "No, I have disagreed with them on other things.1° ivMR. LEE: "Al, would you care to comment on that. We would ratter you didn't, but if you want to you go ahead. Although we think it is covered in the present laws, it is the desire of this group to clarify it." Mr. Poulter's voice did not record. COUNCILMAN FESSMAN: ViWhat if there should be a future law suit." ATTORNEY CURRAN: "Well, I think.11 9/5/57 95 ATTORNEY ENGST AND: ''Mr. Foulter raises a point that we ought to have in mind. I am not familiar with the Sweetwater Fruit Company suit he talks about, but it is possibly a pumping water to the Sweetwater River itself, and I don't think there is much question but what the California Water & Telephone Company and the City of the Irrigation District as their successor would have a prior right to the waters of the Sweetwater River and the underground waters of the Sweetwater River itself which waters would be part of the joint project. Now that is not a well over here, that is your park site." COUNCILWOMAN HOLLIaGS 4ORTH: ''But if it came out of an underground water shed, you are taking about.ss ATTORNEY ENGSTRhND: ''If South Bay built a well down in the Sweet- water Valley next to the Sweetwater River and water dawn there.I MR. LEE: it would have to be owned. The property and the land on which it were used would have to be owned by the South Bay Irrigation District. 1 COUNCILMAN HECK: 'Tr the City of Chula Vista.' ATTORNEY ENGSTa ND: "If you people are wilii. ig to do that, that will be easy draftsmanship to take care of, it will be easy to take care of." COUNCILMAN HECK: 'In other words, dlr. Lee, if Chula Vista wished in their own park down there where they have that nice little lake and everything, if they wished to have a well down and fill that lake with well water, there certainly shouldn't be any reason why they shouldn't do s o. IR. HELM: "The City has a well there. They have a very good well at 4th and the Parkway." MR. LEE: ISay if that was clarified by our Attorney, would it be agreeable to this group?" COUNCILMAN HECK: It certainly would with me, Mr. Lee» R. LEE: "All those in favor signify by saying aye. AYES: Unanimous. MR. LEE: Contrary, no. Now the item 6, whether arbitration should be permissive or mandatory, has been discussed, and I think prob- ably more or less decided. What is your pleasure?'� COUNCILMAN FESSkAN: "I move it be permissive." CQ.INCILurcLVA.N HOLLINGSWORTH: "I'll second it. cs MR. LEE: "All those in favor of arbitration be be used instead of the word 'mandatory' signify word 'permissive' by saying aye.i 9/5/57 AYES: Unanimous. NCR. LEE: 'Contrary no. We are right down where we started. We talked about gaining time, and we haven't got an inch, Is there anything further that we do want to discuss with reference to the resolution, and if not, I think we have pretty well covered it, unless there is some other comment to be made." MAYOR HODGE: ''I think we might as well have your motion now to ac- cept that thing with these changes.' MR. LEE: "May I better understand that, your Honor? MAYOR HODGE: This gentleman here made a -notion to accept this as this contract as written, but I think that it is going to be ac- cepted as written with these changes that were covered tonight.3 MR. LEE: "I think we are open for discussion." MR. HELM: "ahat do you mean by accepting it?" MAYOR HODGE: 'Explain what you meant by accepting it» MR. WALLER: "I meant to accept this as the basis for the group. I did not know whether or not we would accept it. In other words, is this group, are we ready, are you ready to sit down with your people, your advisors and decide that you want to go before the Board and authorize condemnation proceedings on the basis of this report. Are we ready? Some of our members felt that we should go to the Chamber of Commerce, and that we should go to the Council of Chula Vista and explain to them that we have met with you, and that we have agreed and ask them if they would get behind such a proposal providing we had condemnation. We are also going to have to explain to these various advisors, people in public, also that this report, this feasibility report is based on condemnation fig- ures which were made several years ago, and which, in my own mind, I think are going to be very very much hiEher than what we have; and, of course, you get back to the point that the mayor raised a while ago, no I guess itvas Mr. Fessman said, you would have to go to the voters and either do one of two things, either have to sell them cheaper water, give them cheaper water or better water, We are going to have to decide in our own minds whether or not the condemnation figure is going to be what we may think it is, or as it is set out here. The difference between the two could very well mean whether or not we could do those things. There is a lot of difference between ten, twelve, fifteen million and thirty or Forty million dollars, and there is a lot of difference in going to tate people with that, and a lot of difference in the cost. The real estate market, such as it is, and the constant inflation, and the prices such as they are, the attitude of the jury and being gener- ous with money; the fact that either side is going to have to pay all of the cost, that is we would have to pay all of the Attorneys' cost, and the Engineers' cost and law suit cost which our Counsel 9/5/57 97 estimated might cost somewhere between a quarter of a million and a half a million dollars if we didn't accept the figure that the jury arrived at, we would be stuck and have to go back and assess a quarter of a million to half a million dollars. That is quite a decision for me to get in on, and I have got to do a little kick- ing around with it." COUNCILMAN FESSMAN: "'Well, Mr. Chairman, I would like to suggest that this agreement, with its corrections and additions, be rewrit- ten by the Attorney before it is presented to anyone. As it is now, and you give this to someone to read and then tell them 'well, that clause has been changed, and it has been changed here and there*, they will be confused as much as we have been, or worse, and 'think the presentation should be made from a completed final document which these two Attorneys can draw up in accordance with the instructions they have received from these two bodies, and then it is time to present it to those different people, the Chambers of Commerce, the City Council of Chula Vista and our voters over here and our people, and then there won't be any confusion. I think your ideas are well taken, bedause it is going to have to be com- pletely understood by the electorate, otherwise, there is a pos- sibility that it won't carry.' IvR. urALLER: 'I don't think you want it back on your neck, you will want to take it to the people and say there is the basis we worked out with those rascals of the South Bay Irrigation District, it is the best we can do." MR. LEE: If it is the pleasure of this body, then, that we have our Consel re -do, with proposals, making the changes as have been suggested here tonight and get it in form to where we might not necessarily accept it ourselves, but present it to people of our respective districts for their comments and decisions and thereby be guided whether we want to enter into this proposal. Is that the general thinking of the group?" MAYOR HODGE: "I think so." Nib. M: "Mr. Chairman." MR. LEE: 'Clarence." IViR. HELM: "I would like to read my own personal views on this which I think I have given to you fellows, but I would like to ex- press my views to the National City Council, they are short, if you don't mind.' IVi. LEE: "I would like very much to hear them." MR. HELM: "A considerable amount of money has already been spent on feasibility report of January 3, 1956 and the proposed Joint Powers Agreement of 1957, as well as other associate expenses. But these expenditures are very small a ompared with those facing us 98 in proceeding with the necessary steps in condemnation and ultimate _ purchase of the Sweetwater Water System. In consideration of these expenditures to be borne by the taxpayers of the South Bay Irrigat- ion District, I feel that ratification of any Joint Powers Agree- ment with the City of National City that is acceptable to the City Council of National City and the Directors of the South Bay Ir- rigation District is subject to a favorable expression in the Chula Vista administration, the Chula Vista Chamber of Commerce and as many other civic organizations as possible in order to determine the desirability of proceeding with condemnation and calling for a bond election in accordance with the Joint Powers :agreement. That is simply discussing the same views that have been expressed here by Mr. 'daller and Mr. Lee. I want to emphasize the fact that the Chula Vista City Council, the Chula Vista City government have all their water affairs in the South Bay Irrigation District, and we have the responsibility to the City Council of Chula Vista to take them into account. Do I make myself clear?s' MR. LEE: ''You do as far as I am concerned." tiR. w LLE;R: That was what I was waiting for, to have some kind of a final decision here, knowing that it was agreeable to these people so that we would have something to represent to the people. That is what IVir. Fessman anticipated. ° COUNoILI J FESSIviAN: Si That is right, you have to have it so that it can be understood, and it can't be understood as it is now. I don't hardly understand it myself.° MR. LEE: °Well, is there anything further that you wish to discuss? I think we are all in agreement that the agreement should be re- drafted, any corrections that have been discussed, or changes that have been agreed upon, I think our joint Counsels have notes on all of them and can redraft it according to our thinking. We then probably would have to review it and decide what steps we would take from there on. Is that the general feeling of what we want? Is there any further discussion?d ATTORNEY CURRAN: 41 think there should be specific instructions to the Attorneys to proceed with the draft." MR. LEE: 41 am going to ask Counsel for advice here, and anything again we do would probably be unofficial as an overall group. Should we take separate action in the direction of our Attorneys to prepare such a draft? c' ATTudiiEl ENGSTRAND: 41 think that would be educative, the rest of your actions were more informal, but you should instruct me • - -." MR. LEE: c'I then will entertain a motion by one of our members of the South Bay Irrigation District to instruct our Counsel to M - draft this proposed agreement." kal . BUTLER: 4 I' 11 so move. i' 9/5/57 99 IvR. HELM: °°I`11 second it.°P MR. LEE: "All those in favor signify by saying aye.i° AYES: Unanimous. MR. LEE: 'Contrary no. Your Honor?a MAYOR HODGE;: 4I would entertain a similar motion that this be redrafted with additions and corrections as indicated this evening.° COUNCILMAN FESSMAN : so move, Mr. Mayor. °1 COUNCILMAN HECK: f°I111 second it. i° IViAYUR HODGE: AAll in favor.°° AYES: Unanimous. IViYUi HODGE: 1iOpposed. Carried, and so ordered.°° MR. LEE: 'Any further business to come before this group. I see a hand up, Al . ° MR. 1CULTER: i1Yes, are you going to have representation at the meeting in Los Angeles?3 AMR. LEE: 4°We are going to have representation there. Whom it will be, at this time, I do not know. I will contact you later. We hope to have Ray Coyle attend, possibly someone else. We hope that you will also jointly represent us.°f MR. POULTER: Voice did not record. MR. LEE: °iDoes anyone have: any suggestions from our Board? Do any of you want to go up? Shall I then see if Ray can attend and jointly with Al and represent us?41 MR. STE..LE: 1fIf Paul can go. °1 ATTORNEY ENGST2ND: 1°I am not planning on going. i° MAYOR HODGE: 11While we are in this discussion, I will entertain a motion that National City Council adjourn." COUNCILMAN FESSNiAN: 61111 so move, Mr. Mayor.4° COUACILMiN HECK: °'Second.°P NAYOR HODGE: °'Did you second the motion that we adjourn? We will stop the recorder then. All in favor." 9/5/57 100 AYES: Unanimous. mAyoa HODGE: 4Opposed, carried, and so orderedou //a', MAYOR, CITY OF NATICAAL CITY, GJZIF0RNIA ATTEST: CITY CLERK V5/57