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Home My WebLink About07.c. Update on Satellite Water Recycling Facility (SWRF) - Diablo Country Club Demonstration Project s Central Contra Costa Sanitary District DATE: FEBRUARY 18, 2016 TO: HONORABLE BOARD OF DIRECTORS VIA: ROGER S. BAILEY, GENERAL MANAGER JEAN-MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES 00i 4;,/0-;4F FROM: DANEA GEMMELL, PLANNING AND DEVELOPMENT DIVISION MANAGER DAN FROST, SENT R ENGINEER DF SUBJECT: UPDATE ON POSSIBLE SATELLITE WATER RECYCLING FACILITY DEMONSTRATION PROJECT WITH DIABLO COUNTRY CLUB PURPOSE At the September 17, 2015 Board Meeting, the Board of Directors directed staff to investigate implementation models with Diablo Country Club (DCC) and Town of Danville officials with regard to ownership, maintenance, and operation of the proposed Satellite Water Recycling Facility (SWRF) project at DCC. At the December 18, 2015 Real Estate, Environmental & Planning Committee (BEEP) meeting, District staff reported progress on the SWRF after having met with the Town of Danville, Contra Costa County Department of Conservation and Development, State Water Resources Control Board Water Recycling Funding Program and Jim Brezack, DCC's engineering consultant. If the District proceeds with this Demonstration Project, then staff will pursue a $150,000 State Revolving Fund Planning Grant to develop criteria and framework for implementing the SWRF. Staff has discussed DCC's willingness to participate by providing the fifty percent match required for the grant to ensure there is no net cost to the District. Pursuing the grant was supported by the REEP Committee at this meeting. At the February 9, 2016 BEEP Committee meeting, District staff presented various project implementation models with varying division of responsibilities regarding ownership, operations, and maintenance. The Committee was in favor of proceeding with Implementation Model 3 where the District owns, operates, and maintains the SWRF at DCC provided that risks are mitigated and the project is at no net cost to the District. C:\Users\dandersonWppData\Local\Microsoft\Windows\Temporary Internet Files\Content.Outlook\IM9F5ZMU\2-18-16 SWRF Memo.dou At the February 18, 2016 Board Meeting, District staff will be seeking project direction from the Board of Directors in order to proceed with the SWRF Demonstration Project with DCC. PROJECT BACKGROUND On April 23, 2015, the Board of Directors authorized the General Manager to execute a memorandum of understanding (MOU) with the DCC. The MOU documented the mutual agreement of the District and DCC as to the benefits of a Satellite Water Recycling project and to identify and resolve technical issues to the mutual benefit of all parties at no net cost to the DCC also executed a MOU with the East Bay Municipal Utility District (EBMUD) to obtain EBMUD approval to explore the project further because the SWRF Demonstration Project would reduce potable water demand from EBMUD's service area. The proposed SWRF Demonstration Project includes diversion of wastewater from a District sewer trunk line near DCC, a SWRF located on DCC property to treat the wastewater and produce Title 22 recycled water for golf course irrigation, and return of the process solids back to the District's wastewater collection system. The goal of the Demonstration Project is to provide an alternative source of water supply for use by DCC's golf course landscape irrigation using recycled water, and minimize their reliance on EBMUB potable water. In addition to the SWRF Demonstration Project, DCC is planning to implement concurrent water conservation and water storage improvement projects to address their long-term water supply concerns. District staff has also been working with DCC and DCC's consultant, Brezack & Associates Planning (Brezack), to address technical challenges associated with the SWRF. Some issues include determining whether or not sufficient wastewater is available in the District's collection system to meet DCC's recycled water demand at their proposed point of diversion, determining required on-site storage, identifying options for wastewater diversion to the SWRF, identifying operational schemes to minimize risk of collection system overflows/odors/blockages, and determining how to manage waste streams and discharges from the SWRF to the District's collection system. This proposed SWRF with DCC is intended to be a long-term Demonstration Project to inform the District on implementation of potential future SWRF projects. This Demonstration Project supports Goal Four of the District's Strategic Plan ("Be a Leader in the Wastewater Industry") and Strategy 2 to "Collaborate with regional water and wastewater agencies to augment the region's water supply while expanding access to recycled water for Central San customers". PROJECT DELIVERY OPPORTUNITIES, RISKS, AND MITIGATIONS In addition to the originally envisioned SWRF Demonstration Project with DCC, District staff explored other project implementation models with varying divisions of responsibilities regarding ownership, and operations & maintenance. Each project implementation model has its own benefits and disadvantages, and risks that would C:\Users\danderson\Desktop\2-18-16 SWRF Memo(Rev).docx require mitigation. At the February 9, 2016 REEP Committee meeting, District staff presented the five project implementation models below. For all models, the District would ensure that the project is cost neutral to the District. However,'it is important to note that none of these options has been thoroughly reviewed for legal constraints or risks. 1. Implementation Model 1: DCC Finances/Owns/Operates the SWRF (This is the implementation model referred to in the District's existing MOU with DCC). The DCC would likely contract Operations and Maintenance of the SWRF to a third party. 2. Implementation Model 2: DCC Finances and Owns the SWRF. DCC would contract Operation of the SWRF to the District. 3. Implementation Model 3: The District Finances, Owns, and Operates the SWRF. DCC would pay for the full cost of recycled water supplied. 4. Implementation Model 4: The District contracts with a third party to Finance, Own, and Operate the SWRF (Public-Private Partnership). DCC would pay for the full cost of recycled water supplied. 5. Implementation Model 5: The District would partner with DCC, Contra Costa Water District (CCWD), and EBMUD to implement a "Water Wheeling" project. DCC would participate in financing improvements required for the District to provide recycled water to a nearby refinery within CCWD's service area, and in turn CCWD would provide raw water supply rights to EBMUD for an equivalent value of water, and EBMUD would provide guarantees to DCC for a long-term, lower cost supply of potable water for irrigation. Any facilities required would be constructed at the District's treatment plant in Martinez; therefore, this implementation model does not require construction of a SWRF. The attached PowerPoint Presentation summarizes the various DCC SWRF project implementation models, risks, and proposed mitigations. The REEP Committee was in favor of proceeding with Implementation Model 3 where the District owns, operates, and maintains the SWRF at DCC provided that risks are mitigated and the project is at no net cost to the District. At the February 18, 2016 Board Meeting, District staff will be seeking project direction from the Board of Directors in order to proceed with the SWRF Demonstration Project with DCC. Attached Supporting Document(s): 1. PowerPoint Presentation: Satellite Water Recycling Facilities- DCC Demonstration Project. DF:DSG/sdh C:\Users\danderson\Desktop\2-18-16 SWRF Memo(Rev 3).docx ATTACHMENT Item No. 7.c. Satellite Water Recycling Facilities DCC Demonstration Project February 18, 2016 Board Meeting _ � Central Contra Costa Sanitary District � .SWRF DCC 2. SWRF DCC DCC Demonstration Project 0 0 Satellite Water Recyc in aci inty Implementation Models Finances/Owns/ Finances/Owns & Operates ISO �_ 1 i Satellite Water Recycling Facility Concept Screenings Hauled Off-Site ti \_ Chemical/Supplies Deliveries to Site , Pumped Process Solids Wastewater Returned to Withdrawal Collection System Lateral CCCSD Collection System 1 -DCC Finances/Owns/Operates SWRF (Current MOU) Pros Cons • Lowest risk to CCCSD • Does not require CCCSD capital 0 Raw wastewater availability may funds not meet DCC needs • Does not impact CCCSD borrowing 0 Nearby agency concerns capacity 0 Potential impacts on collection • Does not require CCCSD O&M staff system and treatment plant O&M and resources 0 Potential zoning concerns • Reduced effluent discharge D O 2 —DCC Finances/Owns SWRF& CCCSD Operates Pros Cons • Requires additional CCCSD O&M • Does not require CCCSD capital staff and resources funds • CCCSD potentially responsible for • Does not impact CCCSD regulatory compliance borrowing capacity Raw wastewater availability may • Reduces nearby agency concerns not meet DCC needs (e.g. odors, SSOs) Potential impacts on collection a Reduced effluent discharge system and treatment plant O&M • Potential zoning concerns � - D 3 - CCCSD Finances/Owns/Operates Pres Cons • CCCSD has experience • Requires long-term, secure form of owning/operating WWTPs debt repayment • Reduces nearby agency • Potential impact on CCCSD future concerns (e.g. odors, SSOs) borrowing capacity • Eligible for SRF loan • Requires additional CCCSD staff and • Eliminates potential zoning resources concerns • CCCSD responsible for all regulatory Reduced effluent discharge compliance • Raw wastewater availability may nog meet DCC needs • Potential impacts on collection system and treatment plant O&M D 4 - Public Private Partnership ( P3) - Third Party Finances/Owns/Operates Pros Cons • Lower risks to CCCSD • Does not require CCCSD capital funds • Does not impact CCCSD borrowing Contract operations Flaw wastewater availability capacity • Does not require CCCSD O&M staff and may not meet DCC needs Potential impacts on resources • collection system and P3 experienced in owning/operating WWTPs treatment plant O&M • Private partnership interest exists Potential zoning concerns Reduced effluent discharge D O 5 - Regional Water Partnership ("Water Wheeling ") Pros Cons • Centralized recycled water production • More complex (Utilization of existing Filter Plant)) coordination/agreements • Optimizes O&M efficiency • Offset refinery recycled water project between water agencies • State concurrence on water costs • offset concept Lower cost recycled water compared to • Current recycled water quality SWRF (economies of scale) provided by CCCSD may not • Eligible for SRF loan & better positioning match water quality required for grant funding • by DCC Raw wastewater availability nearly • Longer implementation guaranteed • schedule Reduced effluent discharge i _ � Regional Water Partnership ("Water Wheeling ") for DCC Tesoro Refinery i I n a 1 eCCCSD ,� ox p � ice o � c � o � � Implementing DCC SWRIF Demonstration Project -11- M- operations and Financia! Maintenance Impacts Financial Risks Mitigations 1 . How to ensure full cost recovery 1 , Follow EBMUD R.A.R.E of services? financial model 2. How guarantee repayment of 2. Senior Debt on DCC property debt service? and a payment reserve 3. What is impact on District Debt 3. This must be a cost neutral Capacity and Credit Rating? project for District 4. Will O&M costs be considered 4. Meet annually and include in too high over time? agreement 5. How to ensure replacement costs 5. Set up a replacement fund as of SWRF infrastructure are part of payment plan funded in the future? D O 0& M Risks Mitigations 1 . Increased maintenance of 1 . Maintain minimum flow and collection system velocity in collection system downstream of diversion structure 2. Responsibility for complaints 2• Develop SOPs to respond to (e.g. odor, traffic) odor complains and set up truck deliveries in off hours D SWRF DCC Impacts Risks Mitigations 1 . Raw wastewater 1 . DCC to build additional on site availability may not meet storage during periods of low DCC needs flow and use EBMUD water supply to supplement need 2. Interruption of Service: 2. DCC to build additional on site Operations or technical storage during periods of low issues flow and use EBMUD water supply to supplement need 3. Water Quality may not 3. Include agronomist and turf meet DCC expectations specialist on the peer review for end use team when design SWRF and train DCC staff on WQ needs D Legal and Regulatory Risks Mitigations 1 . Will recycle water offsets 1 . Only applicable to Model 1 No (Wheeling concept) be position available at this time challenged? 2. Ongoing Title 22 Compliance. 2. SWRF design criteria and training of operation staff 3. CEQA challenges for SWRF 3. Only applicable to Models 1 , Facility 2, and 4 4. Who owns spills and non- 4. Only applicable to Models 1 , 2 compliance? and 4 L-41 - D Public Perception Risks Mitigations 1 . What is the benefit of the 1 . Alternate source of water project for the public at supply and meet Gola and large? reducing discharge to Suisun Bay 2. Treatment facilities in 2. SWRF to be located inside a residential neighborhoods building on DCC property (NIMBY) D O QUESTIONS D