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March 22, 2022
ITEM TITLE
Master Fee Schedule: Increase in Industrial Wastewater Discharge Permit Fees by Amending the Master Fee Schedule
Report Number: 21-0204
Location: No specific geographic location
Department: Engineering
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
Recommended Action
Adopt a resolution amending the Master Fee Schedule to increase the industrial Wastewater Discharge Permit Fees.
SUMMARY
The City of Chula Vista’s Industrial Users (IU) must obtain permits to discharge into the City’s sewer system to meet pretreatment program requirements. Due to the limited number of IU permits within the City, the services needed to meet the pretreatment program requirements were contracted out to City of San Diego (San Diego) for economic and efficiency reasons. On September 21, 2021, San Diego’s City Council approved a resolution to increase the permit fees for IUs. To ensure compliance with the City’s cost recovery policies, the City is proposing to pass through the increase to the permit fees for the IUs to be in line with the San Diego fees and the addition of a City administrative fee for manual bill processing. The resolution proposes to amend the Master Fee Schedule, Section 12-200, which summarizes the IU permit fees and administrative fee.
ENVIRONMENTAL REVIEW
The Director of Development Services has reviewed the proposed activity for compliance with the California Environmental Quality Act (CEQA) and has determined that the activity involving an increase in Industrial P a g e | 2
Wastewater Discharge Permit Fees is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because it will not result in a physical change in the environment; therefore, pursuant to Section15060(c)(3) of the State CEQA Guidelines, the activity is not subject to CEQA. Thus, no environmental review is required.
BOARD/COMMISSION/COMMITTEE RECOMMENDATION
Not applicable.
DISCUSSION
Background
The City of Chula Vista (City) owns and maintains the sewer collection system which transports the City’s sewage to the City of San Diego’s (San Diego) regional system. Ultimately, City’s sewage is treated at San Diego’s publicly owned treatment works (POTW). Based on federal and stat e regulations, all POTW’s are required to maintain a compliant pretreatment program.
In addition to the regulatory requirements, under the 1998 and 2021 Metro Sewer Agreement between the City and San Diego, the City has a contractual obligation to ensure all industrial users of its wastewater system are regulated by an effective pretreatment program that conforms to all applicable laws, rules and regulations, and is acceptable to the City of San Diego.
Due to the City’s few industrial waste permits (und er 50), it is most efficient and economical to contract pretreatment services to San Diego. The 1993 Interjurisdictional Pretreatment Agreement (Pretreatment Agreement) between the City and the San Diego includes the performance of technical and administr ative activities necessary for implementation of a pretreatment program such as: 1) updating the industrial waste survey; 2) providing technical services, such as sampling, process chemical analysis and engineering advice; 3) permitting; 4) compliance moni toring; and 5) enforcement support. Costs for the services are assessed by San Diego and invoiced directly to the City.
Changes to San Diego Fees Charged to Chula Vista
San Diego’s 1984 Resolution R -260133 (1984 Resolution) includes an annual permit fe e for industrial dischargers that match Chula Vista’s Master Fee Schedule Section 12-200. On September 21, 2021, the San Diego City Council updated for the first time the 1984 Resolution through the approval of Resolution R - 313725, which initiated an incr ease in fees starting July 1, 2022 , with phased in full cost recovery in four annual 25% increments. The phased in amounts are shown in Table 1 and the permit categories are generally defined in their 2020 Industrial Waste Control Program Cost Allocation Study & Model User Guide (Attachment 1).
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City of Chula Vista’s Cost Recovery
City Council Policy 159 -03 on Citywide Cost Recovery includes that city services mainly benefiting specific individuals or businesses should pay for the benefit in proportion to the benefit received. As such the proposed resolution will pass on the costs c harged by San Diego for managing each IU permit on to the individual IU. Chula Vista IU Permit holders will be charged the same amount as the San Diego IU permits holders commencing July 1, 2022, with the addition of an administrative fee to recover Chula Vista’s cost to prepare and send out m anual billing. The administrative fee proposed to be applied to each IU Permit represents the approximate resources needed to process each individual bill , which is reflected in the proposed update to the Master Fee Schedule Section 12-200, Attachment 2.
Outreach Efforts
The City of Chula Vista provided direct noticing to each IU permit holder, prior to San Diego’s passage of Resolution R-313725, and highlighting that the San Diego fee increase would likely translate into a similar City of Chula Vista fee increase due to established cost recovery policies. The letter sent on 3/15/21 to each IU permit holder included the IU’s current annual fee and the proposed full cost recovery annual fee , and provided contact information for City of San Diego staff regarding the proposed fee increases. An example is provided in Attachment 3. Additionally, the following outreach meetings were conducted: Chula Vista City Council informational meeting on 3/23/2021 and Chula Vista Chamber of Commerce meetings on 3/31/21 and 5/26/21.
DECISION-MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is not site-specific and consequently, the real property holdings of the City Council members do not create a disqualifying real property-related financial conflict of interest under the Political Reform Act (Cal. Gov't Code § 87100, et seq.).
Staff is not independently aware and has not been informed of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter.
CURRENT-YEAR FISCAL IMPACT
The increase in the proposed Industrial Wastewater Discharge Permit Fee will ensure the program is recovering the associated costs . T here will be no net change in the Sewer Services Revenue Fund in the current fiscal year.
ONGOING FISCAL IMPACT
Table 1. SAN DIEGO RESOLUTION R -260133 PHASED IN COSTS FOR IU PERMIT CATEGORIES Starting Date
Permit Type 07/01/2022 07/01/2023 07/01/2024 07/01/2025 SIU-Standard $ 2,250 $ 4,500 $ 6,749 $ 8,999 SIU-Complex $ 7,476 $ 14,952 $ 22,427 $ 29,903 Non-SIU/ Categorical $ 1,319 $ 2,639 $ 3,958 $ 5,277 Enhanced Source Control $ 651 $ 1,302 $ 1,952 $ 2,603
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The proposed Industrial Wastewater Discharge Permit Fee increase will ensure the program is recovering the associated costs. There will be no net change in the Sewer Services Revenue Fund in future years.
ATTACHMENTS
Attachment 1 – 2020 San Diego’s 2020 Industrial Waste Control Program Cost Allocation Study & Model User Guide
Attachment 2 – Proposed Master Fee Schedule Section 12-200 Attachment 3 – Example IU Letter Regarding Industrial Discharge Permit Fees Staff Contact: Staff Contact: William Valle, Director of Engineering and Capital Projects/City Engineer and Beth Gentry, Senior Civil Engineer