REPORT TO COUNCIL
SUBJECT
Title
Authorize the City Manager to Execute a Reimbursement Agreement with the Santa Clara Valley Transportation Authority (VTA) for the Relocation of City Water Facilities in Connection with the US 101 Express Lanes Project, Find that the Action is Exempt from the California Environmental Quality Act (CEQA) Pursuant to CEQA Guidelines 15301(c), and Approve Budget Modification No. 6 in the Amount of $300,000
Report
BACKGROUND AND DISCUSSION
The Santa Clara Valley Transportation Authority (VTA) is managing the US 101 Express Lanes Project (Phase 5), which will construct express lanes from Fair Oaks Avenue to the US 101 / I-880 interchange. As part of this project, VTA’s design includes widening the on-ramps at Lawrence Expressway. This will conflict with two existing City of Sunnyvale water valves located on an 18-inch water main.
To resolve the conflict, VTA’s freeway design includes removing the two existing valves and installing two new valves a short distance away along the same main. Staff worked with VTA to refine the design and ensure that the solution is consistent with City standards. The City will continue to own and operate the modified water main. Construction is not anticipated to cause any interruption of water service.
The existing water facilities were constructed in the 1950s under a California Department of Transportation (Caltrans) encroachment permit. Although the original permit document was not found among City and Caltrans records, standard encroachment permit language since the 1940s requires the utility owner to bear the cost of any relocations as needed to accommodate highway improvements. For this project, VTA has agreed to cover the cost of design. The City is required to reimburse VTA for the actual cost of construction.
Per standard Caltrans requirements, the utility reimbursement agreement must be executed prior to advertisement for bids. The final reimbursement amount will be based on actual construction costs, including any changes resulting from unforeseen conditions. VTA estimates the construction cost at $250,000. Staff recommends a budget modification for up to $300,000, which includes a 20% contingency. Staff will inspect the construction work at key stages to ensure proper installation and will review any changes to design and/or cost that may be proposed by the contractor. Staff estimates that the actual cost will not exceed $300,000 but if it does, staff will return to Council to authorize additional funding.
VTA intends to advertise the project in October 2026, with construction anticipated to begin in early 2027.
EXISTING POLICY
• City of Sunnyvale General Plan - Environmental Management, Chapter 7, GOAL EM-3 Reliable and Safe Water Distribution - Proactively maintain the water distribution system infrastructure to ensure the reliable and safe delivery of water under normal and emergency conditions to both current and future customers.
• Pursuant to Chapter 2.09 of the Sunnyvale Municipal Code, City Council approval is required for interagency agreements that may exceed $250,000.
ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) determination for this project is categorical exemption pursuant to CEQA guideline Section 15301(c) for the minor alteration of existing facilities involving negligible or no expansion of the existing use. Although VTA is managing the freeway project, Caltrans is the CEQA lead agency.
FISCAL IMPACT
Budget Modification No. 6 has been prepared to appropriate $300,000 from the Water Supply and Distribution Fund Rate Stabilization Reserve to project 837180 - Water System Transmission Line Valve Replacement and Upgrades.
Budget Modification No. 6
FY 2026/27
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Current |
Increase/ (Decrease) |
Revised |
|
Water Supply and Distribution Fund |
|
|
|
|
Expenditures |
|
|
|
|
Project 837180 - Water System Transmission Line Valve Replacement and Upgrades |
$450,000 |
$300,000 |
$750,000 |
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|
|
|
|
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Revenues |
|
|
|
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Water Supply and Distribution Fund Rate Stabilization Fund |
$30,263,492 |
($300,000) |
$29,963,492 |
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|
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RECOMMENDATION
Recommendation
Authorize the City Manager to execute a Utility Agreement with the Santa Clara Valley Transportation Authority in substantially the form as Attachment 1 to the report, to reimburse actual costs associated with relocation of City Water Facilities and approve Budget Modification No. 6 in the amount of $300,000.
Levine Act
LEVINE ACT
The Levine Act (Gov. Code Section 84308) prohibits city officials from participating in certain decisions regarding licenses, permits, and other entitlements for use if the official has received a campaign contribution of more than $500 from a party, participant, or agent of a party or participant in the previous 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html
An “X” in the checklist below indicates that the action being considered falls under a Levine Act category or exemption:
SUBJECT TO THE LEVINE ACT
___ Land development entitlements
___ Other permit, license, or entitlement for use
___ Contract or franchise
EXEMPT FROM THE LEVINE ACT
___ Competitively bid contract*
___ Labor or personal employment contract
___ Contract under $50,000 or non-fiscal
_X_ Contract between public agencies
___ General policy and legislative actions
* "Competitively bid" means a contract that must be awarded to the lowest responsive and responsible bidder.
Staff
Prepared by: Eric Evans, Senior Environmental Engineer
Reviewed by: Ramana Chinnakotla, Director, Environmental Services
Reviewed by: Matthew Paulin, Director, Finance
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. Utility Agreement for Reimbursement of Water Valve Relocation
2. Project Location Map