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09-09-2019 BPU RPT 08
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09-09-2019 BPU AGENDA
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PJ A r F R F N F R c v L I F E <br />RIVERSIDE PUBLIC UTILITIES <br />W& Board Memorandum <br />P U B L I C U T I L I T I E S <br />BOARD OF PUBLIC UTILITIES DATE: September 9, 2019 <br />ITEM NO: 8 <br />SUBJECT: FIRST AMENDMENT TO GROUND LEASE AGREEMENT WITH GWS#4 <br />DEVELOPMENT, LLC; FIRST AMMENDMENT TO WELL RELOCATION AGREEMENT <br />WITH HILLWOOD ENTERPRISES, L.P.; AND INCREASE WORK ORDER NO. <br />1709464 BY $788,474 FOR A TOTAL PROJECT AMOUNT OF $5,381,653 <br />ISSUES: <br />Approve the First Amendment to the Ground Lease Agreement with GWS#4 Development, LLC, which <br />redefines property easements and increases to City payments to Lessee as credits to monthly rent totaling <br />$493,179; approve the First Amendment to the Well Relocation Agreement with Hillwood Enterprises, L.P. <br />consistent with the redefined property easements in accordance with the amended Ground Lease <br />Agreement; and, approve an increase to Work Order No. 1709464 for additional work to construct Warren <br />4R potable water well in the amount of $788,474 for a total project cost of $5,381,653. <br />RECOMMENDATIONS: <br />That the Board of Public Utilities recommend that the City Council approve: <br />1. Approve the First Amendment to the Ground Lease Agreement with GWS#4 Development, LLC, <br />which redefines property easements and increases to City payments to Lessee as credits to <br />monthly rent totaling $493,179; <br />2. Approve the First Amendment to the Well Relocation Agreement with Hillwood Enterprises, L.P. <br />consistent with the redefined property easements in accordance with the amended Ground Lease <br />Agreement; and <br />3. Approve an increase to Work Order No. 1709464 for additional work to construct Warren 4R <br />potable water well in the amount of $788,474 for a total project cost of $5,381,653. <br />BACKGROUND: <br />On January 23, 2017, the Board of Public Utilities (Board) recommended that the City Council approve the <br />fifty-five year term Ground Lease Agreement with GSW #4 Development, LLC of Ontario, California, and <br />the Well Relocation Agreement with Hillwood Enterprises, L.P. (Hillwood), of Ontario, California. The two <br />(2) agreements allow Hillwood to lease the property and construct a warehouse and distribution building <br />located on the Waterman Golf Course Properties, as shown in Attachment 1. As a requirement to the <br />agreement, Hillwood is obligated to relocate the existing Warren 4 well, associated Rice -Thorne pipeline, <br />and perform numerous water facility abandonments. <br />The total cost estimate to relocate Warren 4 and the associated pipeline is $4,100,000, and is inclusive of <br />a $500,000 contingency. As provided in the Well Relocation Agreement, Hillwood will relocate the existing <br />
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