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HomeMy WebLinkAbout08 - Lower Bay Dredging: MOU for City Contributed FundsQ �EwPpRT c 9C/FOR TO: FROM: CITY OF NEWPORT BEACH City Council Staff Report PREPARED BY: PHONE: TITLE: ABSTRACT: July 26, 2022 Agenda Item No. 8 HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL David A. Webb, Public Works Director - 949-644-3311, dawebb@newportbeachca.gov Chris Miller, Administrative Manager, cmiller@newportbeachca.gov, 949-644-3043 Lower Bay Dredging: Memorandum of Agreement with the US Army Corps of Engineers for City Contributed Funds The US Army Corps of Engineers (USACE) is planning to dredge the federal navigation channels in Newport Harbor this fall. USACE has secured the necessary funding to complete the dredging project, assuming the City of Newport Beach (City) also funds 50% (up to $10 million) of the anticipated costs as it has committed. The City's adopted Capital Improvement Program (CIP) budget includes $10,000,000 in funding for this project. To memorialize the City's contribution to the federal government, USACE requires a Memorandum of Agreement (MOA). Lastly, because a portion of the dredging is over County of Orange (County) tidelands, the County desires to contribute funds to the City, which will pass those funds to USACE. In the near future and likely after bids are received, a County/City MOA will be presented to the City Council for consideration. RECOMMENDATION: a) Find that the approval of the MOA with USACE is covered by the Final EIR No. ER2021-001 (SCH No. 2109110340) in accordance with the California Environmental Quality Act (CEQA), and the Environmental Assessment (EA) and Finding of No Significant Impact (FONSI) prepared by USACE in accordance with the National Environmental Protection Act (NEPA), and that approval of the MOA with USACE will not result in new or additional significant effects on the environment; and b) Authorize the Mayor to execute an MOA with USACE relating to City financial participation in the Lower Newport Bay dredging project. DISCUSSION: Overview Newport Harbor is one of the largest recreational harbors in the United States. Natural processes of storm water and erosion flowing into the harbor, primarily from San Diego Creek, result in the movement and accumulation of sediment which must be dredged periodically to maintain the federally authorized channel depths for safe navigation. 8-1 Lower Bay Dredging: Memorandum of Agreement with the US Army Corps of Engineers for City Contributed Funds July 26, 2022 Page 2 The Federal Channels extend from the Entrance Channel to the Turning Basin (adjacent to the Newport Boulevard Bridge), and from the east anchorage between Bay Island and Lido Isle to the Marina Park area. These channels are the responsibility of and are maintained by the federal government via USACE. The City has, in the past, contributed funds to assist with the federal dredging effort because the dollar amounts historically allocated by the federal government are insufficient to properly maintain the channels to their necessary authorized depths. A portion of the Lower Newport Bay was dredged between May 2012 and January 2013, removing 600,000 cubic yards of material. Unsuitable material dredged during that project was placed at the Port of Long Beach's Middle Harbor Fill Site which was available at that time. The other dredged material that met the required standards was placed at the federally managed open ocean disposal site (LA-3) which is six miles from the Entrance Channel. Prior to the 2012-13 dredging project, approximately 270,000 cubic yards of clean material was removed in 1998 and 1999 from the Main Channel and Upper Bay Channels, and disposed at LA-3. USACE typically conducts annual bathymetric (depth) surveys to determine the amount of sediment that has accumulated in the Federal Channels and to assess the need for maintenance dredging. The 2018 USACE survey indicated that approximately 1.2 million cubic yards of sediment within the established channels requires maintenance dredging to reestablish authorized navigation depths. An updated bathymetric survey has now been completed, and it will be reconciled during final plan review before the project is bid in the fall. Recent sediment characteristic studies were also conducted to evaluate disposal options as required by the regulatory agencies. The most recent sediment sampling effort, conducted in 2018 and 2019, determined that most of the material was suitable for disposal at either LA-3 or within the nearshore disposal zone along the City's ocean beaches. However, some bottom material within the Federal Channels is unsuitable for open ocean disposal even though the material passed toxicity tests. Therefore, this material requires an alternative disposal location, and dredging these areas is not feasible without also identifying a practicable management option for this unsuitable material. As the local sponsor for the dredging project, the City is responsible for identifying a disposal location on behalf of USACE. To manage this unsuitable material, staff reviewed all viable sediment disposal solutions including placing the material at the local ports of Los Angeles and Long Beach as fill, and/or using the material for upland or aquatic disposal within a confined disposal facility (creating land). At this time, the most feasible and cost-effective option to dispose of this bottom sediment material is to construct a Confined Aquatic Disposal (CAD) site within the harbor. 8-2 Lower Bay Dredging: Memorandum of Agreement with the US Army Corps of Engineers for City Contributed Funds July 26, 2022 Page 3 A CAD is constructed underwater by digging a hole then disposing the initial material removed from the hole within the nearshore disposal zone along the City's ocean beaches for replenishment, then placing the non -open ocean quality bottom sediment back inside this hole. A cap of suitable material is then placed on top, creating a physical barrier between any contaminants and the overlying water column and benthic organisms. A defined portion of the CAD will be available for those Newport Harbor residents who might also have material within their slips and bay frontage that is unsuitable for open ocean disposal. At the May 25, 2021 meeting, City Council adopted Resolution No. 2021-46 which 1) certified Environmental Impact Report No. ER2021-001; 2) adopted the Mitigation, Monitoring and Reporting Program; 3) made Facts and Findings; and 4) approved the construction of the Confined Aquatic Disposal facility and dredging outside the Federal Channels in Lower Newport Harbor. USACE MOA From a funding perspective, USACE spent approximately $4 million in 2021 for Phase I, which consisted of dredging the Entrance Channel and repairing the east jetty. After receiving additional funds through the federal Infrastructure Investment and Jobs Act, USACE has approximately $12 million allocated toward completing the dredging project in Newport Harbor. With the ongoing estimate of $20 million, this represents more than half of the required funds. The City has also committed to a 50% match of the USACE project funding, up to $10 million in City funds. In order for the City to contribute funds, a formal MOA must be executed with USACE. (Attachment A). The attached MOA presented is essentially the same as the prior MOA executed between the USACE and the City. Public Works and the City Attorney's Office have reviewed the MOA for funding the Lower Bay Dredging project, and recommend the Council approve and execute this new funding agreement. Prior to USACE bidding the project, the promised City funds must be transferred to the federal government. If any City funds are remaining at the end of the project, USACE will return those unspent funds. County Contribution Because the project will be dredging a portion of County tidelands, the City has asked the County to consider contributing funds (about $2 million) to cover the associated project costs. Because the City is the lead local sponsor with USACE, and because the required timeframe for MOA pre -approval through the federal process is lengthy (at least nine months), staff suggests that the City be the repository of a County contribution even if it means the City will front the money and be reimbursed by the County in the future via a City/County MOA. The MOA would be developed in the near future and prior to contract award. (In 2012, the City and County approached the project in the same manner — the City passed the County funds along to USACE.) 8-3 Lower Bay Dredging: Memorandum of Agreement with the US Army Corps of Engineers for City Contributed Funds July 26, 2022 Page 4 FISCAL IMPACT: The project is estimated to cost approximately $20 million. Of this amount, approximately $12 million will be paid by the federal government leaving a funding shortfall of approximately $8 million. However, in today's current economic climate, including volatile fuel prices, the project may exceed the original estimate after bidding in the fall. The Council will consider contributing up to $10 million of Tidelands Funds toward this project. Also, the County has expressed an interest in, but has not yet finally committed to, contributing approximately $2 million in additional funds to cover dredging over County tidelands. In total, the project would potentially be funded up to $24 million, which should offset any adjustments caused by the current economic climate. The adopted FY 2022-23 Capital Improvement Program (CIP) budget includes $10,000,000 for this agreement. It will be expensed to the Tidelands Capital Fund in the Public Works Department, Account Nos. 10101-980000-18H07 and 10101-980000- 22H07. The Tidelands Capital Fund was created to allow for the sequestration of incremental increases from tidelands rent adjustments solely to finance critical in -harbor capital improvements like seawall repairs, piers and dredging. 4►1y/I:to]kiIJi1=11!11r_10NATAIATiTS Find that the approval of the MOA with USACE is covered by the Final EIR No. ER2021- 001 (SCH No. 2109110340) in accordance with the California Environmental Quality Act (CEQA), and the Environmental Assessment (EA) and Finding of No Significant Impact (FONSI) prepared by USACE in accordance with the National Environmental Protection Act (NEPA), and that approval of the MOA with USACE will not result in new or additional significant effects on the environment. NOTICING: The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENT: Attachment A — USACE Memorandum of Agreement for Dredging Newport Harbor RM ATTACHMENT A MEMORANDUM OF AGREEMENT BETWEEN THE DEPARTMENT OF THE ARMY AND THE CITY OF NEWPORT BEACH FOR MAINTENANCE DREDGING OF NEWPORT HARBOR, CALIFORNIA This MEMORANDUM OF AGREEMENT (hereinafter the "MOA") is entered into this day of , by and between the Department of the Army (hereinafter the "Government"), represented by the U.S. Army Engineer, Los Angeles District (hereinafter the "District Engineer"), and the City of Newport Beach (hereinafter the "Contributor"), represented by its Mayor. WITNESSETH, THAT: WHEREAS, the Newport Harbor, California maintenance project (hereinafter the "Project") was authorized by the River and Harbor Act of 1937, Pub. L. 75-392, 50 Stat. 844, 849, as amended by the Rivers and Harbors Act of 1945, Pub. L. No. 79-14, § 2, 59 Stat. 10, 21; WHEREAS, the amount of Federal funds available for maintenance dredging of the Project is sufficient to proceed with dredging contracts but insufficient to perform all scheduled work; WHEREAS, the Contributor considers it to be in its own interest to contribute funds voluntarily to be used by the Government to perform additional maintenance dredging of the Project (hereinafter the "Maintenance Work"); and WHEREAS, the Government is authorized pursuant to 33 U.S.C. 701h to receive and expend funds to be used for the Maintenance Work. NOW, THEREFORE, the Government and Contributor agree as follows: 1. The Contributor shall provide to the Government up to $10,000,000 to pay costs associated with the Maintenance Work, including the costs of environmental compliance, supervision and administration, and engineering and design. 2. Within sixty (60) calendar days of execution of this MOA, the Contributor shall provide the funds to the Government by delivering a check payable to "FAO, USAED Los Angeles" to the District Engineer or providing an Electronic Funds Transfer of such funds in accordance with procedures established by the Government. S-5 3. The Government shall not commence any Maintenance Work until all applicable environmental laws and regulations have been complied with, including, but not limited to, the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4347) and Section 401 of the Clean Water Act (33 U.S.C. 1341). 4. The Government shall provide the Contributor with quarterly reports of obligations for the Maintenance Work. The first such report shall be provided within thirty (30) calendar days after the final day of the first full quarter of the Government fiscal year following receipt of funds pursuant to this MOA. Subsequent reports shall be provided within thirty (30) calendar days after the final day of each succeeding quarter until the Government concludes the Maintenance Work. 5. Upon conclusion of the Maintenance Work and resolution of all relevant claims and appeals, the Government shall conduct a final accounting of the costs of such work and furnish the Contributor with written notice of the results of such final accounting. If the costs of the Maintenance Work are less than the sum of the Federal funds and the amount of funds provided by the Contributor, the Government shall refund the excess to the Contributor within thirty (30) calendar days of such written notice. 6. No credit or repayment is authorized, nor shall be provided, for any funds provided by the Contributor and obligated by the Government for the Maintenance Work. 7. Nothing herein shall constitute, represent, or imply any commitment to budget or appropriate funds for the Project in the future; and nothing herein shall represent, or give rise to, obligations of the United States. 8. The Contributor shall hold and save the Government free from all damages arising from the Maintenance Work, except for damages due to the fault or negligence of the Government or its contractors. 9. In the exercise of their respective rights and obligations under this MOA, the Government and the Contributor each act in an independent capacity, and neither is to be considered the officer, agent, or employee of the other. 2 :7 10. Notices. a. Any notice, request, demand, or other communication required or permitted to be given under this MOA shall be deemed to have been duly given if in writing and either delivered personally or mailed by first-class, registered, or certified mail, as follows: If to the Contributor: City Manager City of Newport Beach 100 Civic Center Drive Newport Beach, CA 92660 If to the Government: Chief, Navigation Branch U.S. Army Corps of Engineers 915 Wilshire Boulevard, Suite 1100 Los Angeles, CA 90017 b. A party may change the recipient or address to which such communications are to be directed by giving written notice to the other party in the manner provided in this paragraph. Any notice, request, demand, or other communication made pursuant to this paragraph shall be deemed to have been received by the addressee at the earlier of such time as it is actually received or seven (7) calendar days after it is mailed. 11. This MOA may be modified or amended only by written, mutual agreement of the parties. (Signatures on next page) 3 RM IN WITNESS WHEREOF, the parties have executed this MOA as of the day, month, and year first above written. THE DEPARTMENT OF THE ARMY BY: Julie A. Balten Colonel, U.S. Army District Engineer DATE: THE CITY OF NEWPORT BEACH Kevin Muldoon Mayor DATE: APPROVED AS TO FORM OFFICE OF THE CITY ATTORNEY A nH sty Attorney ATTEST: Leilani Brown City Clerk 4 .: CERTIFICATE OF AUTHORITY I, Aaron C. Harp, do hereby certify that I am the principal legal officer of the City of Newport Beach, that the City of Newport Beach is a legally constituted public body with full authority and legal capability to perform the terms of the Agreement between the Department of the Army and the City of Newport Beach, and that the persons who have executed this Agreement on behalf of the City of Newport Beach have acted within their statutory authority. IN WITNESS WHEREOF, I have made and executed this certification this day of 20_. Aaron C. Harp City Attorney CERTIFICATION REGARDING LOBBYING The undersigned certifies, to the best of his or her knowledge and belief that: (1) No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. (2) If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard Form-LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions. (3) The undersigned shall require that the language of this certification be included in the award documents for all sub -awards at all tiers (including subcontracts, sub -grants, and contracts under grants, loans, and cooperative agreements) and that all sub -recipients shall certify and disclose accordingly. This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by 31 U.S.C. 1352. Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure. Kevin Muldoon Mayor DATE: 8-10