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HomeMy WebLinkAboutBOARD MINUTES 06-10-76 792 MINUTES OF AN ADJOURNED REGULAR BOARD MEETING OF THE DISTRICT BOARD CENTRAL CONTRA COSTA SANITARY DISTRICT TO BE A HEARING ON ENVIRONMENTAL QUALITY CHARGE JUNE 10,1976 The District Board of the Central Contra Costa Sanitary District convened in an adjourned regular session at the Supervisors' Chambers, Room 107, County Administration Building, Martinez, County of Contra Costa, State of California, on June 10, 1976 át 7:30 P.M. President Boneysteele called the meeting to order and requested the Secretary of the District to call roll. PRESENT: Members: Gibbs, Mitchell, Allan and Boneystee1e ABSENT: Member: Rustigian (excused) President Boneysteele stated that Member Rustigian indicated at the meeting of June 3,1976 that he would be unable to attend this meeting and requested to be shown as excused. ' 1. OPENING REMARKS President Boneysteele thanked the members of the audience for attending. He then outlined the sequence and procedures to be followed during the Hearing. President Boneysteele explained to those present that the reason for the Hearing was to determine the manner in which the charges would be collected, i.e., whether the charge is to be placed on the tax roll or billed direct; however, the Hearing is now extended to include any matters regarding the charge. President' Boneysteele advised legislation which could affect the Member Allan, who has been working later in the meeting. the audience that there is pending Environmental Quality Charge and that with Congressman Miller, will discuss this II. DISCUSSION OF PROPOSED CHANGES TO ENVIRONMENTAL QUALITY CHARGES President Boneysteele called on Mr. Bohn, Special Counsel to the District, to explain the amendment to Ordinance 117, An Ordinance Adopting the Environmental Quality Charge. Mr. Bohn stated that Section 11-702, Basis of Charge, is proposed to be amended to affect only "improved properties." If this amendment is passed, it will eliminate owners of unimproved property from the Environmental Quality Charge. President Boneysteele thanked Mr. Bohn and asked for any further comments from the Board. There being no further discussion, it was moved by Member Gibbs, seconded by Member Mitchell, that Ordinance No. 118, An Ordinance Limiting the Environmental Quality Charge to Improved Property, be adopted and that this ordinance shall be a general regulation of the District and shall be published once in the Contra Costa Times, a newspaper of general circulation published and circulated in Contra Costa Sanitary District and shall be effective upon expiration of the week of publication. 06 1'0 76 793 ORDINANCE NO. 118, AN ORDINANCE LIMITING THE ENVIRONMENTAL QUALITY CHARGE TO IMPROVED PROPERTY Mot.ion carried by the following vote: AYES: NOES: ABSENT: Members: Members: Member: Gibbs, Mitchell, Allan and Boneysteele None Rustigian (excused) III. PUBLIC HEARING ON USE OF TAX ROLL FOR PURPOSE OF COLLECTING ENVIRONMENTAL QUALITY CHARGES AND RELATED MATTERS President Boneysteele opened the Hearing and introduced Mr. Horstkotte, General Manager-Chief Engineer, of the Central Contra Costa Sanitary District to make a presentation regarding the history and statistics of the District. a. PRESENTATION BY GENERAL MANAGER-CHIEF ENGINEER Mr. Horstkotte stated that when the District started in 1946, there were 20,000 people and it had an assessed valuation of $16,000,000. Since that time, the served population of the District has grown to 300,000 people, requiring 900 miles of pipeline to provide service. The plant has . been improved from the original capacity of 4,000,000 mgd to its presently designed capacity of 45,000,000 mgd with 30,000,000 mgd to receive tertiary treatment. ' As a result of the passage of the Clean Water Act in 1970, the District received certain requirements that had to be met to continue water treatment. In 1972, the Clean Water Act Amendments were approved, which stipulated that the collection of revenue for maintenance and operation of sanitary agencies would be required to change from the "ad valorem tax" method to a "benefit charge" basis. Mr. Horstkotte further stated that we are now facing a mandate which is reflected in Federal Regulations and the purpose of the Hearing this evening is to determine the manner in which this charge is to be collected. Member Allan reported on recent developments at the Federal level and as a result of the developments, Congressman George Miller is attempting to respond to the needs of this area by taking action, which Mr. Eugene Ross, representing Congressman Miller, will explain. Expressing his concern regarding the Environmental Quality Charge, Mr. Ross asked the Board of Directors to make implementation of the Environmental Quality Charge, contingent upon the action taken by the congress on the 1972 Clean Water Act Amendments. Congress is now considering HR9560 having to do with conditions of the Use Charge and Ad Valorem taxes. Congressman Miller is concerned about the problem of tax deductions and whether the Use Charge is a tax deduction. Mr. ,Ross encouraged the Board to stay within the confines of the ad valorem system. Mr. Horstkotte, General Manager-Chief Engineer, stated that while this Board appreciates the efforts Congressman Miller has made in our behalf, we have no assurance that this Bill will pass. We must determine now whether the money comes from Use Charge or Ad Valorem tax. The District cannot work on speculation and it is his recommendation that the Board take action to guarantee that the District can operate within the fiscal year. President Boneysteele queried as to the effect of SB90 on the District. 06 10 76 794 Mr. Bohn, Special Counsel for the District, stated that even with the passage of the statute, you are dealing with a statistical problem, however, it is possible that a 'combination can be worked out modifying the Use Charge. Member Mitchell commented that since we have a 6l~ tax rate, 6~ of which is for paying off bond financing, at the present time SB90 would limit us to 55~. He queried if we were to lower the tax rate in conjunction with the Environmental Quality Charge, would the District be limited to the 37~ tax rate. It was Mr. Bohn's opinion that the District has the right to go to the rate at which it was frozen (55~) but cannot give a firm answer without further research. Member permanent. we have the maintenance balance. Allan stated that any action the District takes is not necessarily If the legislation (HR9560) is successful in September or October, choice of going back to the Ad Valorem tax for a portion of and operation costs and use a service charge (EQC) for the Mr. District effect. present Charge" Dalton, Deputy General Manager-Chief Engineer, commented that the can return to the 55~ rate established in 1972 when SB90 went into President Boneysteele asked Mr. Dalton if the District retains the 6l~ tax rate, of which 55~ applies to the operation, will a "Use s~ill be required. Mr. Dalton answered in the affirmative stating that the tax rate of 55~ would not derive the required revenue. At the present time our Revenue Program is the only source for operations and maintenance cost permitted by the State of California. Mr. Ross stated that he was leaving a copy of HR9560 with Mr. Hopkins, Secretary of the District. Member Mitchell then informed Mr. Ross that the District has to adopt a Revenue Program before the Federal and State Agencies will approve any more grant fund payments. The deadline for initiating a program is this month, therefore, it is imperative that a program be adopted at this time. b. PRESENTATION BY CONSULTANT ON REVENUE PROGRAM President Boneysteele introduced Mr. Mike Verlander, Lead Economist with Brown and Caldwell, the District's Revenue Program Consultant. Mr. Verlander explained that the rates for the Environmental Quality Charge are a result of a long-range project that was started in the early '70's. In 1971, the Regional Water Quality Control Board issued interim requirements for treating waste water to the tertiary level. To come up to the Federal Guidelines, it became necessary to expand our Treatment Plant Facilities. The District was able to obtain Federal and State grant funding of up to 87-1/2% or $60,000,000 for this project, leaving a cost of $10,000,000+ to expand the facility to 30,000,000 MGD advanced treatment. The addition of Solid Waste Recovery will reduce the maintenance cost requirements. In order"to obtain the grants, the District had to meet three requirements: l. 2. 3. Managerial ability Financial capaèity Fair and equitable rates , 06 10 76 795 Property taxes will continue to be used as a revenue source for capitalization. The Environmental Quality Charge will pay for the Maintenance and Operating costs of the District. With the use of slides and charts, Mr. Verlander explained the amount of sewage and quantities of pollutants the typical residence discharges during one year and the annual cost incurred by the District for treating this waste, thereby being a basis for determining the $72 charge. The charges for Commercial and Industrial users will be a good deal higher since it is proposed to bill them on strength 'and volume of their dis charges. c. DISCUSSION,OF WRITTEN PROTESTS SUBMITTED TO THE BOARD President Boneysteele stated that Mr. Hopkins, Secretary of the District, has advised the Board that there have been 97 protest letters received to date. He further indicated that Mayor Sparacino of Martinez wished to be recognized to read a letter on behalf of the citizens of Martinez. Mayor Sparacino read his letter stating that he understands the District's need to develop new revenue and that the Federal government has limitations as to the alternatives for raising funds, still, he is deeply concerned about the inequality of this charge as it affects various householders. Also, the impact of the charge placed on the commercial user could put a number of Martinez residents out of work. He hoped the Board would give this matter serious consideration before making a final decision. President Boneysteele thanked Mayor Sparacino and asked if any other official or candidate wished to be heard. Mr. Geno Banducci, candidate for the County Board of Supervisors, 30 Descanso Drive, Orinda, approached the podium and stated that he agreed with Mayor Sparacino. Mr. Banducci asked the Board, since the charge on undeveloped property has been amended, does this mean that the charge for residential users would be raised. President Boneysteele replied that it would not be raised. Mr. Banducci stated that even though SB90 lowers the tax rate to 37ç and implements the $72 charge, he feels it won't be long before we are paying the 55ç tax rate again, plus the $72. Member Mitchell stated that the Board has never collected revenue other than that necessary to operate the District. It has met its obligations through tax revenue and monies collected from connection fees and annexation charges. Now, with the tertiary treatment requirements and the necessary plant expansion, the cost is going to be tremendous. President Boneysteele thanked Mr. Banducci and then stated that at the beginning of the meeting he requested people who wished to'address the Board regarding the charge to fill out the provided form and present it to the Secretary. The "Complaint Review and Request" forms will be reviewed by staff for subsequent action. President Boneysteele recessed the Hearing at 8:29 P.M. President Boneysteele reconvened the Hearing at 8:35 P.M. d. PROTESTS AND QUESTIONS FROM THE FLOOR The following are the persons addressing the Board with respect to the Environmental Quality Charge: 06 10 76 796 . Mr. Derek R. Augood, 151 Camino Amigo Ct., Danville - Mr. Augood dbjected strenuously to the charge stating that he is on septic tank and therefore, not a user. Member Mitchell stated even though he is not a user, if you are within 200' of a sewer line you are considered a user. The Health Department Officer denies septic tank permits if there is a sewer within that distance. Mr. T. B. Strand, 1229-1233 Boulevard Way, Walnut Creek - Mr. Strand stated that he has 60 small low-rent units, of which 90% are rented to Senior Citizens. In most cases, there is only one occupant per apartment and therefore, feels this charge is unfair. Hr. William P. Baker, 820 Main Street, Martinez - Mr. Baker, Executive Vice President of the Contra Costa Taxpayers Association, stated that it is hard to find an equitable solution to this problem. Property tax is ,deductible - service charges are not. The Central Contra Costa Sanitary District cost figures are higher than those of other Districts because we are treating our wastewater at a tertiary level. He also stated that the District should review the cost figures and perhaps, the $72 figure could be lowered for the first year. He concluded by stating that the District should use its authority in cases where this charge would drive people out of their homes and businesses. Member Mitchell commented that the cost aspect is due to the State requirements. The District is also endeavoring to set up a solid waste fuel system to use garbage in place of natural gas. We are attempting to reduce costs wherever we can. J. W. Sandusky, 1536 Rancho View Drive, Lafayette - Mr. Sandusky, representing the Rancho View Knolls Home Owners Assn., stated that they regard this charge as an attempt to circumvent the tax ceiling. The Association recommends close observation of maintenance as it applied to the $72 charge. Mr. Leslie Benson, 119 Aspen Drive, Pacheco - Mr. Benson stated that there is no line available to him for connection. Board members requested that he fill out the complaint form and District staff will explore the situation. The Board responded and indicated that if there is no. service available, the property will be exempt. Mr. John Sustek, 1731 Candelero Ct., Walnut Creek - Mr. Sustek stated that the ad valorem tax is a much more equitable way of measuring residential use than a sewer use charge. If we must have a charge, then it should be as low as possible and the ad valorem tax raised to make up the difference. Member Mitchell responded stating that he would like to see legislation where a more equitable distribution could be accomplished and that until two years ago, the District did not anticipate the charge. Mr. Verlander commented that the State requirements for user charges are much more stringent than those of the Federal Government. Mr. R. A. Beeton, 2048 Oak Park Blvd., Pleasant Hill - Mr. Beeton stated that he was shocked by the proposed service charge and the inequity of it. Albert I. Rieger, 701 Escobar, Martinez - Mr. Rieger asked if there was any other means of financingjthe plant expansion. Mr. Dalton, Deputy General Manager-Chief Engineer, responded to Mr. Rieger and explained the District's methods of financing capitalization cost and the use of revenue derived from the $72 charge. 06 10 76 797 Robert Barge, 1640 Botelho Drive, Walnut Creek - Mr. Barge explained that his property is an unimproved vacant lot and he objects to the charge~ President Boneysteele stated that the Ordinance has been amended this evening to eliminate the charges on unimproved property. Mr. Edward Mecchi, 3394 Angelo, Lafayette - Mr. Mecchi stated that his property is such that he cannot connect to the sewer. President Boneysteele replied that the District staff would investigate the situation. Mr. Barry Burlingame, 2755 Acacia Drive, Walnut Creek - Mr. Burlingame questioned the Board and staff on the cost factors used in establishing the revenue program. Mr. Dalton responded to Mr. Burlingame's questions. President Boneysteele recessed the Hearing at 9:56 P.M. President Boneysteele reconvened the Hearing at 10:08 P.M. Mr. Ray Ruggles, 125 Vista Del Diablo, - Mr. Ruggles stated that the District did not give the public an opportunity to become aware of the plant expansion and that the public was not given any detailed breakdown of the $72 charge. Member Mitchell informed Mr. Ruggles that the District tries to keep the public informed. Mr. Leslie C. Gallaugher, 3104 Perra Way, Walnut Creek - 11r. Gallaugher stated that he is on septic tank, has never used the sewer and already pays the 6lç tax rate and assessment bonds. He feels that the amended ordinance should also exclude all septic tank users. Mr. Robert W. Reading, 953 Escondido Court, Alamo - Mr. Reading requested the Board to define a user. He feels it is unfair to charge people not connected to the sewer line and questioned the legality of doing this. He also stated that in his case it was not economically feasible to connect. Member Mitchell responded stating that he was impressed by his argument and understands that people on a septic tank have received quite a jolt. Perhaps there is some justification for eliminating septic tank users from the charge and there may be some compromise between 0 & $72. Robert M. Heath, Executive Vice President, Martinez Chamber of Commerce. Mr. Heath read a letter to the Board from the President of the Martinez Chamber of Commerce wherein much concern was expressed for people on fixed incomes and specifically, the commercial rate proposed for the Martinez laundry. The chamber would appreciate a review of the Revenue Program. ltt. John Bauer, 24 Oak Road, Orinda - Mr. Bauer requested a copy of the Budget and was informed by Mr. Dalton that it had not been completed as yet. Mr. Bauer stated that there should be an open hearing on the buget. Member Gibbs informed Mr. Bauer that the District does have an open hearing on the budget and we announce this in the papers. Member Allan advised Mr. Bauer that we have two regular meetings each month that are open to the public. During these meetings the staff has been presenting reports of these very budget questions and the mechanics of setting the $72 charge. 06 10 76 798 Mr. J. Richard Maffei, 1070 Bristol Court, Walnut Creek, representing a Home Owners' Association - Mr. Maffei complimented the Board on their proceedings and stated that it is obvious that the charge has to be established. However, he felt that details regarding cost should be made available to the various users. Mr. Maffei questioned the costs for removal of phosphorous. Mr. Horstkotte, General Manager-Chief Engineer, responded stating that the District submitted a budget report in 1972 to the regulatory agencies and at that time, they established parameters including the removal of bio-stimulant materials. Mr. Ron Sieger, Consultant from Brown and Caldwell, indicated that the use of lime keeps the phosphate in control. Mr. Verlander referred Mr. Maffei to the tables in the revenue book to help answer his question. Mr. John C. Lonzo, 1984 Magnolia Way, Walnut Creek - Hr. Lonzo objected to the tax rate. Mrs. Alice Link, 132 Meadow Lane, Orinda- was speaking on behalf of the senior citizens. chargèshould be paid out of the property taxes in accordance with personal income. Mrs. Link stated that she She does not feel that the but should be proportioned Member Mitchell stated that by accepting the grant, the plant has been financed from income, but the District is not authorized to collect operating and maintenance costs from income. Mr. Richard P. Karnan, General Partner, Concord Cascade Mobil Home Park, Pacheco - Mr. Karnan stated that the proposed charge represents an"increase of 6.8 times the present rate. It is his contention that someone in a business such as his, should be allowed to spread the charge over a period of time rather than having to pay a lump sum. Mr. John Thorp, 3065 No. ~fuin Street, Walnut Creek - Mr. Thorp, an apartment house owner, stated that the charge applied to his property amounts to a 500% increase and the quantity discharged from an average residence is much greater than the discharge from an apartment. He therefore feelsthat the charge is disproportionate. Mr. Ralph L. Meilandt, 30 Bolla Avenue, Alamo - Mr. Meilandt stated that he prefers the ad valorem tax rather than a service charge. Mr. Derek Augood asked the Board why the District went to the tertiary treatment if it was not required. President Boneysteele responded, saying that Control Board recommended this level of treatment that by going to the tertiary treatment, we would funding. the State Water Resource and assured the District be eligible for grant Member Gibbs stated that there is reason to believe that within three to five years, that this will be required in any event. Mr. Edward Mecchi thanked the Board for their patience and courtesies. At 11:36 P.M., President Boneysteele recessed the Hearing. At 11:45 P.M., President Boneysteele reconvened the Hearing. There being no further comments, President Boneysteele declared the Hearing closed. 0/6 10 76 799 President Boneysteele stated that the comments of the people who, appeared before the Board could be grouped in the following categories: 1. Improved properties within 200 feet of a sewer and not connected. 2. Regressivity of the charge. 3. Representatives of business community. 4. Charge as it affects single occupant homes and mobile homes. Member Mitchell queried staff if they could give a figure as to how many residents are on septic tank and within 200 feet of a sewer line. Staff was unable to give a number or the affect on the revenue program at this time, but would check into the matter. It was moved by Member Gibbs, seconded by Member Allan, that staff be directed to initiate a study to ascertain a reasonable estimate of the number of developed properties within 200 feet of a main sewer that are being served by septic tanks. Motion carried by the following vote: AYES: NOES: ABSENT: Members: Members: Member: Gibbs, Mitchell, Allan and Boneysteele None Rustigian (excused) After further discussion it was moved by Member Gibbs, seconded by Member Mitchell, to adopt the following resolution: RESOLUTION NO. 76-136, A RESOLUTION ADOPTING THE REPORT OF THE GENERAL MANAGER-CHIEF ENGINEER FIXING THE AMOUNT OF THE ENVIRONMENTAL QUALITY CHARGE FOR RESIDENTIAL USERS FOR THE FISCAL YEAR 1976-1977, AND PROVIDING FOR THE COLLECTION THEREOF ON THE TAX ROLL Motion carried by the following vote: AYES: NOES: ABSENT: Members: Members: Member: Gibbs, Mitchell, Allan and Boneysteele None Rustigian President Boneysteele thanked the people for attending the Hearing and adjourned the meeting at 12:13 A.H. June 11,1976. £: President of the Board of D ectors of Central Contra Costa Sani ry District of Contra Costa County, State of California COUNTERSIGNED: :~" . Secret ry of the 'oard of Directors of Central Contra Costa Sanitary District of Contra Costa County, State of California 06 10 76