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HomeMy WebLinkAbout06. Consider approval of proposed Guiding Principles for Satellite Water Recycling Facility Projects Page 1 of 7 Item 6. CENTRALSAN Jdf A- hom CENTRAL CONTRA COSTA SANITARY DISTRICT January 27, 2022 TO: HONORABLE BOARD OF DIRECTORS FROM: MELODY LABELLA, RESOURCE RECOVERY PROGRAM MANAGER REVIEWED BY: JEAN-MARC PETIT, DIRECTOR OF ENGINEERING AND TECHNICAL SERVICES KENTON L. ALM, DISTRICT COUNSEL ROGER S. BAILEY, GENERAL MANAGER SUBJECT: CONSIDER APPROVAL OF PROPOSED GUIDING PRINCIPLES FOR SATELLITE WATER RECYCLING FACILITY PROJECTS Staff initially reviewed proposed Guiding Principles for Satellite Water Recycling Facility (SWRF) projects with the Board of Directors (Board) at the December 16, 2021, Board meeting. Based on the discussion at that meeting, staff has incorporated the Board's input and is returning with those proposed edits. See Attachment 1 for a redlined version, highlighting edits to Guiding Principles two through five, and Attachment 2 for the new proposed version of the Guiding Principles for the Board's consideration. Strategic Plan Tie-In GOAL ONE: Customer and Community Strategy 2—Maintain a positive reputation GOAL TWO: Environmental Stewardship Strategy 3—Support regional development of local water supply GOAL THREE: Fiscal Responsibility Strategy 1—Maintain financial stability and sustainability ATTACHMENTS: 1. SWRF Guiding Principles - Redlined 2. SWRF Guiding Principles - Proposed January 27, 2022 Special Board Meeting Agenda Packet- Page 42 of 84 Page 2 of 7 ATTACHMENT 1 DRAFT CENTRAL SAN'S GUIDING PRINCIPLES FOR SATELLITE WATER RECYCLING FACILITY PROJECTS Wastewater is a valuable resource for California's water supply. Based on projections of future California population expansion and, even with water use efficiency, demand for water will continue to increase and will rely on including wastewater and recycled water as part of the portfolio of water resources. Accordingly, the value of recycled water and wastewater as a new supply will increase. In order to benefit the greatest number of Central San's customers with this valuable resource, it is Central San's preference to provide recycled water service to interested customers from Central San's main treatment plant in Martinez. If such centralized service is determined to be infeasible technically, financially, geographically, and/or timing-wise, Central San will support the development of Satellite Water Recycling Facility (SWRF) Projects. Central San's authorization to enter into a memorandum of understanding (MOU) and/or subsequent agreement(s) will be conditioned upon the MOU, agreements, and the operation adhering to these Guiding Principles. Each term in a SWRF Project's MOU and/or agreement will be developed in a manner consistent with the terms listed below. A. Guidin_g Principle 1: Cost Neutrality 1. SWRF Projects will be cost neutral to Central San ratepayers. 2. During the planning of a SWRF Project, and consistent with Central San's approach on new development projects, appropriate Central San staff time spent supporting the project's development will be paid by the project applicant. 3. During the start-up and operation of a SWRF Project, any additional operational or maintenance costs borne by Central San will be fully reimbursed by the project applicant. 4. Any regulatory fines or legal penalties resulting from sanitary sewer overflows from Central San's collection system that are caused by a SWRF Project's wastewater diversion and/or discharge of waste-activated sludge will be reimbursed by the project applicant. 5. Central San revenues, generated from the sewershed upstream of a SWRF Project's wastewater diversion location, will not be shared. These revenues include sewer service charges, Ad Valorem taxes, and capacity fees. 6. Central San provides wastewater treatment, by a contract with the City of Concord, for the cities of Concord and Clayton. Payment for this service is based on the flow ratio into Central San's wastewater treatment plant. Therefore, accurate metering and regular reporting of the amount of wastewater flow diverted from Central San's collection system will be required. B. Guiding Principle 2: Community InputConsent Community in utGe4sent for the overall project concept, its location, and the financial/structural arrangements for its construction, long-term operation, and Page 1 of 3 January 27, 2022 Special Board Meeting Agenda Packet- Page 43 of 84 Page 3 of 7 DRAFT maintenance is essential for the successful implementation of any SWRF Project. This includes inputt by Central San customers and any jurisdiction having authority over all or portions of the SWRF Project, including the applicable water purveyor, a city, town, and/or Contra Costa County. C. Guiding Principle 3: Wastewater Supply Availability 1. Central San's mission is to protect public health and the environment. Central San is committed to considering diversion of its available raw wastewater flow for potential SWRF Projects, with the understanding that Central San's first priority is the safe and effective operation of its wastewater collection system. 2. As Central San cannot control the volume of wastewater generated in the upstream sewershed, Central San cannot guarantee the volume, quality, and availability of wastewater flow to a proposed SWRF Project. 3. Potential regulatory changes, outside of Central San's control, could impact the upstream wastewater supply volume available to a SWRF Project, including reductions to indoor water use targets, which can lead to lower wastewater generation rates. 4. To the extent it is within Central San's control, Central San will protect the upstream wastewater supply at a proposed SWRF Project's identified diversion location by not approving any diversions from Central San's upstream sewershed, if inadequate wastewater supply exists to achieve the downstream SWRF project's recycled water supply goals. D. Guiding Principle 4: Mitigation of Technical and Operational Impacts 1. The proposed SWRF Project will need to be designed and constructed in a manner that does not damage Central San's infrastructure as a result of the diversion of wastewater or interfere with Central San's main treatment plant as a result of its treatment process discharges into Central San's collection system. 2. Central San must maintain a minimum amount of wastewater flow in its collection system to prevent solids from settling. If low flows from a SWRF Project's diversion causes solids settling or odor issues, Central San will enlist its collection system operations' crews to clean the impacted portion of the collection system and the project applicant will need to be reimburse Central San for that additional cost and remedy the cause. E. Guiding Principle 5: Readiness and Ability to Proceed Interested applicants should be aware that implementing a SWRF Project will require substantial planning and development and a significant capital investment in addition to ongoing operation and maintenance costs. To assure the efficient use of Central San's staff resources and forward momentum on SWRF Projects, the following requirements will be employed: Page 2 of 3 January 27, 2022 Special Board Meeting Agenda Packet- Page 44 of 84 Page 4 of 7 DRAFT 1. Two-year terms will be used in all preliminary MOUs and up to five-year terms will be used in planning agreements, based on scheduling input from the project applicant, and both would have the ability to extend the termination date by executing an Amendment. Lw#ile longer terms (20-30 years) will be used for diversion and/or operations and maintenance agreements. 2. Completion of a feasibility study by the project applicant will be required. Details of the study contents will be determined by Central San staff. Page 3 of 3 January 27, 2022 Special Board Meeting Agenda Packet- Page 45 of 84 Page 5 of 7 ATTACHMENT 2 DRAFT CENTRAL SAN'S GUIDING PRINCIPLES FOR SATELLITE WATER RECYCLING FACILITY PROJECTS Wastewater is a valuable resource for California's water supply. Based on projections of future California population expansion and, even with water use efficiency, demand for water will continue to increase and will rely on including wastewater and recycled water as part of the portfolio of water resources. Accordingly, the value of recycled water and wastewater as a new supply will increase. In order to benefit the greatest number of Central San's customers with this valuable resource, it is Central San's preference to provide recycled water service to interested customers from Central San's main treatment plant in Martinez. If such centralized service is determined to be infeasible technically, financially, geographically, and/or timing-wise, Central San will support the development of Satellite Water Recycling Facility (SWRF) Projects. Central San's authorization to enter into a memorandum of understanding (MOU) and/or subsequent agreement(s) will be conditioned upon the MOU, agreements, and the operation adhering to these Guiding Principles. Each term in a SWRF Project's MOU and/or agreement will be developed in a manner consistent with the terms listed below. A. Guidin_g Principle 1: Cost Neutrality 1. SWRF Projects will be cost neutral to Central San ratepayers. 2. During the planning of a SWRF Project, and consistent with Central San's approach on new development projects, appropriate Central San staff time spent supporting the project's development will be paid by the project applicant. 3. During the start-up and operation of a SWRF Project, any additional operational or maintenance costs borne by Central San will be fully reimbursed by the project applicant. 4. Any regulatory fines or legal penalties resulting from sanitary sewer overflows from Central San's collection system that are caused by a SWRF Project's wastewater diversion and/or discharge of waste-activated sludge will be reimbursed by the project applicant. 5. Central San revenues, generated from the sewershed upstream of a SWRF Project's wastewater diversion location, will not be shared. These revenues include sewer service charges, Ad Valorem taxes, and capacity fees. 6. Central San provides wastewater treatment, by a contract with the City of Concord, for the cities of Concord and Clayton. Payment for this service is based on the flow ratio into Central San's wastewater treatment plant. Therefore, accurate metering and regular reporting of the amount of wastewater flow diverted from Central San's collection system will be required. B. Guiding Principle 2: Community Input Community input for the overall project concept, its location, and the financial/structural arrangements for its construction, long-term operation, and Page 1 of 3 January 27, 2022 Special Board Meeting Agenda Packet- Page 46 of 84 Page 6 of 7 DRAFT maintenance is essential for the successful implementation of any SWRF Project. This includes input by Central San customers and any jurisdiction having authority over all or portions of the SWRF Project, including the applicable water purveyor, a city, town, and/or Contra Costa County. C. Guiding Principle 3: Wastewater Supply Availability 1. Central San's mission is to protect public health and the environment. Central San is committed to considering diversion of its available raw wastewater flow for potential SWRF Projects, with the understanding that Central San's first priority is the safe and effective operation of its wastewater collection system. 2. As Central San cannot control the volume of wastewater generated in the upstream sewershed, Central San cannot guarantee the volume, quality, and availability of wastewater flow to a proposed SWRF Project. 3. Potential regulatory changes, outside of Central San's control, could impact the upstream wastewater supply volume available to a SWRF Project, including reductions to indoor water use targets, which can lead to lower wastewater generation rates. 4. To the extent it is within Central San's control, Central San will protect the upstream wastewater supply at a proposed SWRF Project's identified diversion location by not approving any diversions from Central San's upstream sewershed, if inadequate wastewater supply exists to achieve the downstream SWRF project's recycled water supply goals. D. Guiding Principle 4: Mitigation of Technical and Operational Impacts 1. The proposed SWRF Project will need to be designed and constructed in a manner that does not damage Central San's infrastructure as a result of the diversion of wastewater or interfere with Central San's main treatment plant as a result of its treatment process discharges into Central San's collection system. 2. Central San must maintain a minimum amount of flow in its collection system to prevent solids from settling. If low flows from a SWRF Project's diversion causes solids settling or odor issues, Central San will enlist its collection system operations' crews to clean the impacted portion of the collection system and the project applicant will need to be reimburse Central San for that additional cost and remedy the cause. E. Guiding Principle 5: Readiness and Ability to Proceed Interested applicants should be aware that implementing a SWRF Project will require substantial planning and development and a significant capital investment in addition to ongoing operation and maintenance costs. To assure the efficient use of Central San's staff resources and forward momentum on SWRF Projects, the following requirements will be employed: Page 2 of 3 January 27, 2022 Special Board Meeting Agenda Packet- Page 47 of 84 Page 7 of 7 DRAFT 1. Two-year terms will be used in all preliminary MOUs and up to five-year terms will be used in planning agreements, based on scheduling input from the project applicant, and both would have the ability to extend the termination date by executing an Amendment. Longer terms (20-30 years) will be used for diversion and/or operations and maintenance agreements. 2. Completion of a feasibility study by the project applicant will be required. Details of the study contents will be determined by Central San staff. Page 3 of 3 January 27, 2022 Special Board Meeting Agenda Packet- Page 48 of 84