For Water Subcommittee Meeting August 27, 2026
TO: Water Subcommittee Members
APPROVAL: Yazdan Emrani P.E., Director of Public Works
FROM: Nicole Hemmans, Senior Administrative Analyst
Title
Staff Request Water Subcommittee Receive an Overview of the Labor Reset Process and Result, and Provide Feedback on the 2020 - 2023 Labor Component Reset and Associated Staffing Adjustments Under the Rialto Water Services Operations and Maintenance Subcontract.
RECOMMENDATION
Staff recommends that the Water Subcommittee receive an overview of the Labor Reset process and result, and provide feedback on the 2020 - 2023 Labor Component Reset and associated staffing adjustments under the Rialto Water Services Operations and Maintenance Subcontract.
Body
BACKGROUND
On March 27, 2012, the City Council and the Rialto Utility Authority (RUA) approved a Concession Agreement (CA) with Rialto Water Services, LP (RWS), operated by Veolia North America (Veolia). Articles VIII and XIV of the Concession Agreement establish the compensation framework for wastewater and water services, including the Labor Component.
Sections 8.11 and 14.11 of the Agreement require that the Labor Component be recalculated every fourth (4th) Contract Year using the methodology defined in the Operations and Maintenance Subcontract (OMS).
On March 26, 2026, Staff presented the proposed 2020-2023 Labor Component Reset and associated staffing adjustments to the Water Subcommittee for review and feedback.
Staff have worked with RWS to finalize the calculations to confirm the Fixed Labor Service Fees for the next four-year period 2024 to 2027. The Water Subcommittee at a previous meeting concurred with the hiring of the Lab Tech position. Both staff and RWS are in agreement with these labor-related fees and the three additional positions as proposed by RWS.
ANALYSIS/DISCUSSION
The Labor Component Reset remains under review by Staff and Veolia. An update to the Labor Reset will be presented to the Water Subcommittee for consideration as the review and coordination process continues.
ENVIRONMENTAL IMPACT
The proposed action is not a “Project” as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. According to Section 15378(b), a Project does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.
GENERAL PLAN CONSISTENCY
Approval of the proposed action also complies with the following City of Rialto Guiding Principles, General Plan Goals and Policies: “Our City government will lead by example, and will operate in an open, transparent, and responsive manner that meets the needs of the citizens and is a good place to do business.”
LEGAL REVIEW
The City Attorney's Office has reviewed the staff report.
FINANCIAL IMPACT
Operating Budget Impact
There is no fiscal impact associated with receiving this update at this time.
The proposed staffing adjustment includes three wastewater-dedicated positions, two Collection System Technicians and one Laboratory Technician, with an estimated ongoing annual cost of approximately $286,000. On average, each position represents a fully burdened cost of approximately $90,000 to $100,000 annually.
Overall, the proposed staffing adjustment represents a modest increase to the systemwide labor component, primarily supporting regulatory compliance, increased operational demands, and system growth.
Capital Improvement Budget Impact
There is no impact on the Capital Improvement Budget.
Licensing
This action does not require a business license.
ATTACHMENTS
1. Veolia Labor Reset Memo - 8/18/2026