EPAST
EAST PALO ALTO SANITARY DISTRICT
BOARD OF DIRECTORS 901 Weeks Street
Bethzabe Yañez, President East Palo Alto, CA 94303
Martha Stryker, Vice President Phone: (650) 325-9021
Glenda Savage, Secretary
Dennis Scherzer, Director www.epasd.com
Joan Sykes-Miessi, Director
Via E-Mail and Certified Mail Akin Okupe, M.B. A, P.E, General Manager April 06,2022
Jaime M Fontes
City Manager
City of East Palo Alto
2415 University Ave
East Palo Alto, CA 94303
Dear Mr Fontes,
This acknowledges receipt of the City of East Palo Alto's ('City") letter to the East Palo Alto Sanitary District ("District"), dated March 4, 2022, concerning the 185-unit affordable housing project at 1805 East Bayshore Road ("Project") by Light Tree Two, L.P. ("Developer").
The City has proposed the following courses of action as the basis of a Memorandum of Understanding to move the Project forward:
1. The Project move forward with construction shown in segments A through 6 of the Exhibit A
2. The City will issue an encroachment permit for all work required in segments A through 6, and the California Environmental Quality Act (CEQA) clearance for that permit and work is documented in the Notice of Exemption filed by the District on March 23, 2021 pertaining to the 1805 East Bayshore Road Sewer Main Replacement Project ("Sewer Main Replacement Project").
3. The District begins construction work on segments A through 6.
4. The California Environmental Quality Act environmental review of the construction and
installation of the sewer lines in Segment 7 will be included in the California Environmental Quality Act environmental review for the District's Trunk Line Project
5. Pursuant to the Sanitary District Act of 1923, the District is authorized to charge fees or charges for services and facilities in connection with its sanitation or sewerage system. However, revenues derived from such fees or charges may not be used for the acquisition or construction of additional local street sewers or laterals which are an augmentation to an existing system. (Health & Safe. Code, § 6520.5.) It is for this reason that the District and Developer entered into the Wastewater Service Agreement, dated June 12, 2020 ("Agreement"). The Agreement provides that Developer is required to,
fund the sewer system expansion improvements for the Project, and Recital E of the Agreement specifically states that such improvements shall be at no cost to the District except as explicitly set forth in the Agreement. As a result, an Initial Study will be required to analyze environmental impacts, and additional measures may be required to minimize impacts moving forward, including a regulatory permit from the U.S. Army Corps of Engineers.
The Agreement does not require that the District expend any of its own funds to address this issue. This provision, amongst others, reflects the clear statutory prohibition against spending customer-provided revenues on expansion of system infrastructure to accommodate new development.
As such, the District proposes to proceed as follows: the Sewer Main Replacement Project will be bifurcated into two phases to allow for completion of a segment of the project as depicted on Exhibit A. The District will commence the remaining segment of the Sewer Main Replacement Project after CEQA analysis is completed and all necessary permits are obtained by the District, provided it shall not be at the expense of the District. The District will not be responsible for additional costs, if any, associated with serving the development.
Please also note that the Developer cannot connect the additional units to the District's collection system until the improvements are completed. Please contact me with any questions or to discuss further. The District's goal is to resolve this issue in a timely and fair manner.
If you have any questions or concerns, please give me a call at (650) 325-9021 Very truly yours,
Akin Okupe
General Manager
East Palo Alto Sanitary District
EXHIBITA
Source: Exhibit C, Wastewater Services Agreement; Freyer and Laureta Table 5 June 9, 2020 lINE. LLIA
NAY WAY
SPAIN SET CAMELLIA
FEN, VERBINA
DRIVE GARDENIA
M34
STREET
DRIVE
DRIVE STREET CAKES,
- WAY TATE
„ARDIA
MOUTON CIR STREET
TINSLEY
S1
LOTUS MOUTON CIR
WILKEŚ STREET
WISTERIA GATES STREET
STRE
DAISY
HIBISCUS Cl
LIGHT TREE - EPASD WASTEWATER SERVICES AGREEMENT - EXHIBIT C MAP