WORKSHOP SESSION -- DIVISION OF CLEAN WATER PROGRAMS
ITEM 13: RECOMMITMENT AND EXCHANGE OF STATE REVOLVING FUND (SRF) LOAN COMMITMENT FROM FFY 1998 TO FFY 1999 AND FFY 2000 FOR SAN LUIS OBISPO COUNTY SERVICE AREA NO. 9 -- LOS OSOS/BAYWOOD PARK WASTEWATER PROJECT SRF NO. C-06-4014-110
DISCUSSION: By Resolution No. 90-19 dated February 15, 1990, the State Water Resources Control Board (SWRCB) provided a funding commitment for this project for $47 million ($40 million from FFY 1992 funds and $7 million from FFY 1993 fund). The project consists of sewage collection, treatment and disposal for approximately 6,900 existing residences. Project construction will prevent further groundwater nitrate contamination caused by on-site systems and remedy existing violations of the Basin Plan and Regional Water Quality Control Board Orders.
Due to legal actions by some property owners in opposition to the project, the project experienced extensive delays in 1990 through 1992. On January 21, 1993, the SWRCB adopted Resolution No. 93-7 amending Resolution No. 90-19 by exchanging the earlier SWRCB's commitment for FFY 1992 and FFY 1993 funds to FFY 1995. In addition, Resolution No. 93-7, granted the project first priority for funding from the available 1995 SRF repayment money.
In 1993, the legal actions were resolved in favor of the County. However, due to the continuing organized opposition by the same property owners, and lengthy additional studies conducted by consultants at the direction of the County, the project sustained more delays. On January 18, 1996, the SWRCB adopted Resolution No. 96-4 amending Resolution No. 93-7 by exchanging the SWRCB's commitment from FFY 1995 SRF repayment funds to FFY 1998 SRF repayment funds. Resolution No. 96-4 also required that the County submit biddable plans and specifications by September 1, 1997, or the preliminary loan commitment would be withdrawn.
The County did not meet the September 1, 1997, deadline for submittal of plans and specification. In August of 1997, the County appeared before the California Coastal Commission seeking a construction permit for the project. Due to voiced opposition at the meeting from members of the Los Osos/ Baywood Park Community, the Coastal Commission has postponed its decision until a full hearing can be held. This hearing is tentatively scheduled for January 1998.
San Luis Obispo County remains in violation of Cease and Desist Orders No. 89-125, 89-126 and 89-127 issued by the RWQCB, Central Coastal Region. These orders required compliance with the Basin Plan mandate to cease discharging from individual on-site waste treatment systems by August 31, 1994. This deadline was an extension of the original compliance date of November 1, 1988 required by RWQCB Resolution 83-13. The RWQCB, at its meeting of October 13, 1995, seriously considered the imposition of Administrative Civil Liability penalties totaling $300,000 on the County as a result of these continued violations. However, based on the County's progress and current situation regarding the Coastal Commission permit, the RWQCB has postponed indefinitely the imposition of any monetary penalties. There is still substantial organized opposition to the proposed project from some of the ratepayers within the project service area.
The County's current schedule for the project has the final design of the project being finished in September of 1998 and the project going to construction in March of 1999. This schedule assumes that the County will be granted a construction permit by the Coastal Commission at its January 1998 hearing. If the permit is not issued or the decision is appealed, a longer time line will likely result. The RWQCB has yet to adjust the current Time Schedule Order also, pending the outcome of the January 1998 Coastal Commission hearing. The County has been consulted and agree with the staff recommendation.
POLICY ISSUE: 1.Should the SWRCB exchange its loan commitment for Los Osos/Baywood Park project from FFY 1998 to FFY 1999 and FFY 2000?
2. Should the SWRCB, in accordance with Section VIII(J) of the February 16, 1995, SRF Policy, require the expiration of this revised loan commitment, if the project construction does not commence by April 1, 1999?
RWQCB IMPACT: None
FISCAL IMPACT: According to SWRCB Resolution No. 97-001 (Approval of a Staff Proposal to Better Manage the SRF Repayment Account), the SWRCB may approve preliminary loan commitments against the current FFY account and against 125 percent of future repayment funds based on scheduled loan dates.
The SRF account balances, anticipated repayment amounts, and project approvals under consideration by the SWRCB in November 1997 are as follows:
|FFY 97 Carryover:||$30,067,202|
|Est. FFY 98 Cap. Funds:||$92,500,000|
|1996 Bond Funds:||___________||$67,520,976||$315,156|
|San Luis Obispo County||4014-110||$47,000,000||-$22,000,000||-$25,000,000|
|City of San Jose||4220-xxx||-$40,000,000|
|City of San Diego||4119-xxx||-$13,201,000||-$43,525,000||-$10,910,000|
|City of San Diego||4542-110||-$7,342,470||-$678,850|
|City of Sacramento||4441-xxx||-$28,000,000||-$24,000,000||___________|
Balance after Approval
STAFF RECOMMENDATION: That the SWRCB adopt a resolution approving the exchange of SRF loan funding commitment of $47 million from FFY 1998 to FFY 1999 and FFY 2000 (Based on current construction schedule) for the Los Osos/Baywood Park project and require the expiration of the loan commitment, if project construction does not commence by April 1, 1999?
October 27, 1997 DRAFT
1. The State Water Resources Control Board adopted Resolution NO. 96-4 on January 18, 1996, approving a State Revolving Fund (SRF) loan commitment of $47 million to San Luis Obispo County Service Area No. 9 for the Los Osos/Baywood Park Wastewater project (Project);
2. Resolution No. 96-4 gave the project first priority for a SRF loan from the available FFY 1998 repayment SRF money;
3. The project is currently almost eight years behind the schedule included in the original facilities plan approval letter of January 31, 1990;
4. The County's current schedule indicates that final design will not be complete until September of 1998 and construction will begin by April 1, 1999; and
5. This exchange of funding, will make $47 million of FFY 1998 SRF funding available immediately to fund other eligible projects ready to proceed.
THEREFORE BE IT RESOLVED THAT
The State Water Resources Control Board:
1. Amends Resolution No. 96-4 by exchanging the commitment for a SRF loan of $47 million to San Luis Obispo County Service Area No. 9 from FFY 1998 SRF repayment funds to $22 million from FFY 1999 and $25 million from FFY 2000 SRF repayment funds, with a repayment period of twenty (20) years and the first repayment due one (1) year after completion of construction; and
2. Will withdraw this $47 million preliminary loan commitment if construction of the project does not commence by April 1, 1999. The Division may approve up to a ninety (90) day extension of this date for good cause.
The undersigned, Administrative Assistant to the Board, does hereby certify that the foregoing is a full, true, and correct copy of a resolution duly and regularly adopted at a meeting of the State Water Resources Control Board held on November 18, 1997.
Administrative Assistant to the Board