HomeMy WebLinkAbout06. Continue to waive volumetric fee for Commercial Recycled Water Truck Fill Program Page 1 of 3
Item 6.
CENTRAL SAN BOARD OF DIRECTORS
POSITION PAPER
MEETING DATE: NOVEMBER 19, 2020
SUBJECT: AUTHORIZE THE GENERAL MANAGER TO CONTINUE TO WAIVE THE
VOLUMETRIC FEE FOR COMMERCIAL RECYCLED WATER TRUCK FILL
PROGRAM CUSTOMERS UP TOA LIMIT OF 100,000 GALLONS PER YEAR,
PER CUSTOMER FOR CALENDAR YEARS 2021 AND 2022
SUBMITTED BY: INITIATING DEPARTMENT:
RICHARD FOSS, ASSOCIATE ENGINEER ENGINEERING AND TECHNICAL SERVICES-
PDS-PLANNI NG AND APPLI ED RESEARCH
REVIEWED BY: DAN FROST, SENIOR ENGINEER
DANEA GEMMELL, PLANNING AND DEVELOPMENT SERVICES DIVISION
MANAGER
JEAN-MARC PETIT, DIRECTOR OF ENGINEERINGAND TECHNICAL
SERVICES
Roger S. Bailey
General Manager
ISSUE
Since the assessment of recycled water rates is codified in the District Code, the Board of Directors
(Board) must authorize any modifications.
BACKGROUND
I n November 2015, the Board approved a one-year emergency drought relief pilot project to waive the
volumetric fee for the cost of recycled water obtained through Central San's Commercial Recycled Water
Truck Fill Program as a way to encourage the use of recycled water to save limited potable water
resources. I n April 2015, Governor Jerry Brown issued an executive order directing mandatory water use
reductions for the first time in California's history, saying the state's four-year drought had reached near-
crisis proportions after a winter of record-low snowfall. I n that executive order, Governor Brown directed
November 19, 2020 Regular Board Meeting Agenda Packet- Page 38 of 152
Page 2 of 3
the State Water Resources Control Board to impose a 25 percent reduction on the state's 400 local water
supply agencies. These restrictions were later lifted in May 2016.
When the one-year pilot was complete, the Board authorized the General Manager to continue to waive the
volumetric fee for calendar years 2017 and 2018, as a continued incentive to use recycled water. In 2018,
the Board authorized the continuation of the fee waiver for calendar years 2019 and 2020, with a limit that
the fees would be waived for each customer up to their first 100,000 gallons of recycled water used.
Since the fee waiver program was extended in 2018, Central San has provided over 4.5 million gallons per
year to Commercial Recycled Water Truck Fill Program customers. I n 2020 (to date), there have been 10
customers with usage ranging from around 1,000 gallons to several millions of gallons. Nearly 75 percent
of the recycled water used in 2020 was for the nearby Interstate 680/State Route 4 Interchange
construction project. The number of customers and usage by customers fluctuates each year, and total
program usage is mostly influenced by large construction projects that elect to use recycled water, and
when drought restrictions encourage or require contractors to use recycled water in lieu of potable water.
Below is a table summarizing the Commercial Recycled Water Truck Fill Program usage for the last four
years.
2020
Commercial Recycled Water Truck Fill Program 2017 2018 2019 (as of
10/13/20)
Total Recycled Water Gallons Provided to Customers 637,340 600,240 4,679,814 4,548,861
Total Recycled Water Value (if 100% of usage were billed to customers) $2,242 $2,201 $17,662 $17,532
Limit on Annual Waiver of Recycled Water Fees No No 100,000 100,000
Limit Limit Gallons Gallons
Total Recycled Water Billed to Customers $0 $0 $16,261 $16,079
Number of Customers 11 11 12 10
Number of Customers Using More than 100,000 Gallons per Year 2
Amount of Recycled Water Provided to Customers Using Less than 59,473 39,537 75,174 182,129
100,000 Gallons per Year
Value of Recycled Water Not Billed to Customers $2,242 $2,201 $1,403 $1,453
The current fee waiver provides an incentive to use recycled water but places a limit on the extent to which
Central San provides this valuable resource at no cost to the customer, while recognizing that producing
recycled water comes at a cost. If the Board approves this extension, staff will return to the Board at the
end of calendar year 2022 to seek direction on this issue for calendar year 2023.
ALTERNATIVES/CONSIDERATIONS
Alternative 1: The Board could choose to begin re-assessing the volumetric fee for all recycled water
obtained through the Commercial Recycled Water Truck Fill Program and not renew the fee waiver.
Alternative 2: The Board could continue to waive the volumetric fee for all recycled water obtained through
the Commercial Recycled Water Truck Fill Program, regardless of volume used.
FINANCIAL IMPACTS
Commercial customers obtaining recycled water for truck filling have historically been assessed Central
San's recycled water rate, which is currently$3.91 per 1,000 gallons (effective July 1, 2020). The latest
effective recycled water rate would be applied to each customer's usage that exceeds the limit of 100,000
November 19, 2020 Regular Board Meeting Agenda Packet- Page 39 of 152
Page 3 of 3
gallons per year. Staff time associated in preparing the customer billings is estimated to be approximately
four hours per month.
COMMITTEE RECOMMENDATION
The Real Estate, Environmental & Planning Committee reviewed this item at its November 2, 2020
meeting and recommended Board approval.
RECOMMENDED BOARD ACTION
Authorize the General Manager to continue to waive the volumetric fee for Commercial Recycled Water
Truck Fill Program customers up to a limit of 100,000 gallons per year, per customer for calendar years
2021 and 2022.
Strategic Plan Tie-In
GOAL ONE: Customer and Community
Strategy 1—Deliver high-quality customer service, Strategy 2—Maintain a positive reputation
GOAL THREE: Fiscal Responsibility
Strategy 2—Ensure integrity and transparency in financial management
November 19, 2020 Regular Board Meeting Agenda Packet- Page 40 of 152