ITEM 6:APPROVAL OF A STATE REVOLVING FUND (SRF) FOR THE CITY OF SAN DIEGO, POINT LOMA DIGESTERS 7 AND 8 AND GAS SYSTEM UPGRADE PROJECT, SRF LOAN PROJECT NO. C-06-4383-110
DISCUSSION: In accordance with the State Water Resources Control Board's (SWRCB) Policy for Implementing the State Revolving Fund (SRF) for Construction of Wastewater Treatment Facilities (Policy), adopted on February 16, 1995 and amended on January 18, 1996, projects on the adopted priority list need SWRCB approval to receive a SRF loan. Loans can be approved by the SWRCB after the Division of Clean Water Programs (Division) has approved the facilities plan, including (1) the project report; (2) environmental documents; (3) the draft revenue program; and (4) the water conservation plan.
On July 8, 1997, the Division issued Facilities Plan Approval to the City of San Diego (City) for the Point Loma Digesters 7 and 8 and Gas System Upgrade Project, and the City agreed in writing with the approval on July 10, 1997.
The City of San Diego is located in southern California (see attached location and vicinity map). The City owns and operates the Point Loma Wastewater Treatment Plant (Point Loma Plant), which currently accommodates a service area population of 1,868,000.
The Point Loma Plant treats an average of 179 million gallons per day utilizing advanced primary treatment. The main treatment processes consist of primary clarifiers and anaerobic digesters. Ferric chloride and polymer are added to the influent to improve solids capture. Effluent is discharged to the Pacific Ocean and digested biosolids are pumped offsite for dewatering and disposal.
The Point Loma Plant has six anaerobic digesters. In order to meet the City's future needs, and meet the minimum 15 day retention time for pathogen reduction mandated for Class B biosolids, two additional digesters are necessary.
Construction for this project began in July 1996 and it is about 50 percent complete. The final plans and specifications were approved by the Division July 17, 1997. In accordance with the SRF Policy, all construction costs incurred prior to the date of final plans and specifications approval are not eligible. Because construction was initiated before the facility plan could be reviewed by the Division, the project had to be retroactively approved.
During the planning process, the City did not complete the State Historic Preservation Office Cultural Resources evaluation. Under the SWRCB's operating agreement with the EPA, cultural resources clearance is considered part of the Federal environmental "cross-cutting" requirements. According to the Code of Federal Regulations, only applicants whose projects are funded with monies directly made available by Federal capitalization grants need comply with applicable Federal authorities. Funds directly made available by capitalization grants are any funds equaling the amount of the capitalization grant.
The SRF program in California met its equivalency requirements in 1994, and there is about $450 million of potential excess equivalency monies in the SRF account. The SWRCB can therefore, at its discretion, commit up to this amount for "non-equivalency" projects. The Division requests funding for this project from non-equivalency funds. The estimated project cost is $21,200,000, and the estimated loan eligible cost is $10,896,340.
The City meets about 75 percent of its water needs through purchases of imported water from the San Diego County Water Authority (Water Authority). The remainder of the domestic water supply demand are provided by local surface water supplies amd recycled water. The Water Authority is a member agency of the Metropolitan Water District of Southern California, which imports water from the State Water Project and the Colorado River. Both the Water Authority and the Metropolitan Water District have adopted long term plans designed to ensure the adequacy and reliability of water supplies to their service areas beyond the next twenty years. In accordance with the SRF Policy requirements for water conservation, the City is a signatory to the "Memorandum of Understanding Regarding Urban Water Conservation in California".
The City prepared an EIR which was distributed to the public and circulated through the State Clearinghouse (SCH# 95011057) for a 45 day review period in May 1995. During the review period the City received comments from two Federal agencies, three State agencies, and five private organizations or interested parties.
The City provided adequate responses to all comments received during the review period. On November 20, 1995, the City Council certified the EIR. On November 22, 1995, the City filed a Notice of Determination with the San Diego County Clerk and the Governor's Office of Planning and Research.
An Addendum to the EIR was prepared on September 25, 1996, to address the relocation of the Central Boiler Facility. The City determined that the changes were minor and would not result in any new significant impacts or mitigation. The City certified the Addendum and approved the changes on November 18, 1996, and filed a Notice of Determination with the San Diego County Clerk and the Governor's Office of Planning and Research on November 22, 1996.
The City requests the SWRCB approve a loan of $10.9 million for this project and agrees to pay back the loan in accordance with the SRF Policy. Construction was initiated for this project in FFY1996 and will continue through March 1999 and therefore part of the loan commitment may be made against future SRF repayment monies.
POLICY ISSUE: Should the SWRCB approve SRF loan funding for the proposed project, including a twenty (20) year repayment period, with the first repayment due one (1) year after completion of construction.
RWQCB IMPACT: None
FISCAL IMPACT: The SRF account balances, anticipated repayment amounts, and project approvals under consideration by the SWRCB in September 1997 are as follows:
|City of Colton||4251-110||$8,100,000|
|Santa Ynez CSD||4357-110||$508,000|
|City of San Diego||4383-110||$10,900,000|
|City of Auburn||4471-110||$3,200,000|
|Balance after Approval:||$36,815,155||$5,654,499||$11,592,174|
STAFF RECOMMENDATION: That the SWRCB adopt a resolution approving a SRF loan for the proposed project, with a repayment period of twenty (20) years, and with the first repayment due one (1) year after completion of construction.
September 9, 1997 - DRAFT
1. The State Water Resources Control Board, on February 16, 1995, adopted the "Policy for Implementing the State Revolving Fund (SRF) for Construction of Wastewater Treatment Facilities," and revised it on January 18, 1996;
2. The State Water Resources Control Board, on September 19, 1996, adopted the FFY 1996 SRF Loan Program Priority List which included the Digester Facility Upgrade and Expansion for the City of San Diego in Priority Class B;
3. The Division of Clean Water Programs (Division) has approved the project report, environmental documents, and draft revenue program for the City's project;
4. The water purveyors for the service area are signatories to the "Memorandum of Understanding Regarding Urban Water Conservation in California";
5. The City could not meet the Federal Cross Cutting requirement for cultural resources because the project was already under construction when the SWRCB review process began. There is, however, $450 million in potential non-equivalency funds that the SWRCB can commit for non-equivalency SRF loans; and
6.The City of San Diego certified an EIR and Addendum (State Clearinghouse # 95011057) which have been reviewed and considered, and it has been determined that:
(a) As stated in the EIR, even with the implementation of mitigation measures (landscaping and planting with earth tone colors), the project may result in significant and unavoidable impacts with respect to visual inpacts from the construction of a retaining wall and a berm.
The SWRCB hereby adopts the following statement of overriding considerations to address the unmitigatable impacts that may potentially occur from approval of the project:
Implementation of the project will result in the following benefits: (1) it will enable the Point Loma Wastewater Treatment Plant to meet new Federal treatment standards related to biosolids; (2) it will provide a key element in meeting the California Coastal Commission's mandate to relocate the existing sludge drying operations at Fiesta Island; (3) it will allow for proper maintenance, repair, and upgrade of the plant, alleviate several existing problems and constraints in the operations of the plant; and (4) with respect to the long term effects of the berm, it will maintain, protect, and ultimately enhance public views from within the Cabrillo National Monument, and reduce air quality and traffic impacts associated with hauling the overburden offsite.
In balancing the project benefits against the potential significant impacts regarding visual impacts, the SWRCB finds that the public benefits of the project outweigh the unavoidable impacts and therefore determines that the impacts are acceptable.
(b)With respect to other potentially significant environmental impacts identified in the environmental documents, appropriate changes and alterations are not within the responsibility and jurisdiction of the SWRCB. Such other changes or alterations have been adopted or should be adopted by other agencies.
THEREFORE BE IT RESOLVED THAT:
The State Water Resources Control Board approves a SRF loan of $10.9 million to the City of San Diego for the construction of the Point Loma Digesters 7 and 8 and Gas System Upgrade Project, with a repayment period of twenty (20) years, and the first repayment due one (1) year after completion of construction;
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 September 18, 1997.
Administrative Assistant to the Board