For Water Subcommittee Meeting September 25, 2025
TO: Water Subcommittee Members
APPROVAL: Tanya Williams, City Manager
FROM: Tim Sullivan, Assistant City Manager
Title
Staff Requests that the Water Subcommittee Provide Feedback on the Automatic Meter Infrastructure (AMI) Project
(ACTION)
body
RECOMMENDATION
Staff recommends that the Water Subcommittee provide feedback on a Final Construction Work Authorization (FCWA) with Rialto Water Services, as operated by Veolia North Operating Services, Inc. for the Automatic Meter Infrastructure Project (AMI), for an amount not to exceed $7,998,719.
BACKGROUND
On March 27, 2012, the City Council and Rialto Utility Authority (RUA) took several actions related to the approval of a Concession Agreement (CA) with Rialto Water Services, LP, (RWS), as operated by Veolia North Operating Services, Inc. (Veolia). This public-private partnership assigned the operation and maintenance of the City’s water and sewer/wastewater utilities to RWS. Pursuant to Article XII “Water Facility Improvements and Capital Projects” of the CA, certain capital projects were identified by the CA for implementation by RWS.
ANALYSIS/DISCUSSION
The City of Rialto (City) and Rialto Utility Authority (RUA) have secured $8,000,000 in grant funding for the Advanced Metering Infrastructure (AMI) Project: $6,000,000 from the California Department of Water Resources’ Urban Community Drought Relief Grant (DWR) and $2,000,000 from the U.S. Department of Interior, Bureau of Reclamation (USBR). The DWR grant agreement requires funds to be expended by November 1, 2026, and the USBR funds by December 31, 2026.
To align with state and federal grant requirements, the City’s Public Works Department issued a revised bid for the AMI Project under Request for Proposals (RFP) #25-047 on July 10, 2025. Bids closed on August 12, 2025, with two firms submitting responsive proposals: Thirkettle Corporation/Aqua-Metrics and Utility Service Co. Inc./USG Water Solutions (USG).
A panel of ten evaluators with expertise in AMI project implementation, engineering, capital improvement project delivery and inspection, and grant management from both RWS-Veolia and the City reviewed the proposals using three categories: Team Qualifications and References, Technical Requirements, and System Integration Experience. Cost proposals were submitted separately and were not included in the ranking criteria to ensure an objective and fair evaluation process.
Based on these criteria, the evaluation panel determined that USG ranked highest overall. Following the evaluation, City and RWS representatives began good-faith negotiations with USG to finalize the project scope, pricing, and deliverables, with the goal of establishing a contract that meets both technical and grant compliance requirements.
FCWA Cost Proposal
RWS-Veolia is committed to completing the project by December 31, 2026, in alignment with the grant timeline.
ENVIRONMENTAL IMPACT
The proposal 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 IMPACTS
Operating Budget Impact
By implementing an AMI meter system, it is anticipated that there will be a reduction in Veolia’s field service staff due to reduced field visits. The reduction will be calculated during the 2024-2027 Labor Reset of the Concession Agreement for Water and Wastewater with Rialto Water Services.
Capital Improvement Budget Impact
The Project will be funded through $8 million in grant funds to implement the Advanced Metering Infrastructure (AMI): Department of Water Resources Urban Community Drought Relief Grant Funds for $6,000,000 and the U.S. Department of Interior, Bureau of Reclamation Grant Funds for $2,000,000.
The grants will go before the City Council for acceptance of the grant monies at the same time that the FCWA is awarded to Veolia for the AMI project.
The Veolia Recovery, 2017-24 Project Development fee of $350,000 will be paid from the Water Fund’s Rate Stabilization Account.
ATTACHMENTS
FCWA with Rialto Water Services, as operated by Veolia North Operating Services, Inc., for the Automatic Meter Infrastructure Project.