OF EAST PALO
CITY OF EAST PALO ALTO
Office of the City Manager
INCORPORATED
May 5, 2022
Rob Bartoli
Executive Officer
San Mateo Local Agency Formation Commission
455 County Center, 2nd Floor
Redwood City, CA 94063
[email protected]
RE: Municipal Service Review Updates for the City of East Palo Alto, East Palo Alto Sanitary District, and West Bay Sanitary District
Mr. Bartoli,
This letter serves as the City of East Palo Alto's official response to the Draft Municipal Service Review (MSR) for the City of East Palo Alto (EPA), East Palo Alto Sanitary District (EPASD), and West Bay Sanitary District (West Bay) published by your agency on March 28, 2022.
On behalf of the City Council, staff, and the community of East Palo Alto, I want to thank you and the team at Berkson Associates for investing so much time in understanding and reviewing this critical issue.
The Draft MSR is a comprehensive document that provides robust analysis of the three subject entities and an accurate account of current issues impacting the ability of the East Palo Alto Sanitary District to meet the needs of East Palo Alto residents and taxpayers to advance new development ranging from individual accessory dwelling units (ADUs) to larger development projects consistent with the General Plan.
Development that is stalled due to inadequate sewer infrastructure is essential to meet the City's affordable housing and employment opportunities and accommodate much needed services including a health care clinic and job training facility to the benefit of city residents and taxpayers.
Since its incorporation in 1983, the City has struggled to achieve economic growth and financial sustainability, especially in comparison to other nearby communities. To address this reality, the City's leadership has ensured a strong focus on actions that strengthen the City's economic profile, with the ultimate goal of improving the lives and enhancing the well-being of East Palo Alto residents. To that end, the City became successor to the East Palo Alto County Waterworks District in 2001 and the Ravenswood Lighting and Drainage Maintenance Districts in 2005. Establishing the EPASD as a subsidiary district of the City, an alternative supported by the MSR, would make the City whole as a land use agency and utility provider.
From 2010 to present, the City, City Council, and residents advanced several policy and development actions to support the City's affordable housing and economic development goals, as shown in the table below:
CITY OF EAST PALO ALTO ADVANCEMENTS IN POLICY AND DEVELOPMENT Year Action
Approval of the Ravenswood / 4 Corners Transit Oriented Development 2013
(TOD) Specific Plan
2016 Approval of the Vista 2035 East Palo Alto General Plan Approval of Water Rights Transfer Agreement with the City of Mountain 2017 View to provide adequate water to support the City's future development objectives
Passage of Measure HH (by 79.58%), a $2.50 per square foot tax on 2018 certain development to support the City's affordable housing goals and provide residents with access to jobs in the S.T.E.M and building trades Approval of City-Wide Development Impact Fee Program to ensure new 2019 development in the City provides fair-share contributions to pay for much needed infrastructure
Approval of new contractor (Veolia North America') to operate and 2020
maintain the City's water system
2022 (In process) Potential update to the General Plan to account for additional growth
The City Council and staff have demonstrated a strong commitment to positioning the City to achieve a level of economic self-sufficiency to improve the quality of life for residents, business owners, and visitors.
For the last three years, several members of the City Council, City staff, consultants, and other stakeholders have attempted to collaborate with EPASD in an effort to develop solutions that would: 1) facilitate the advancement of City-approved development projects, and 2) ensure that those interested in developing in East Palo Alto are able to obtain the necessary information to make informed decisions. To date, very little tangible progress has been made. There has been one (1) project for which EPASD committed in an agreement to provide a sewer connection once the development was completed, and the EPASD has failed to meet the timelines specified in that agreement. Subsequently, the EPASD has stated that they will agree to a revised timeline, dependent upon the receipt of payment from the developer or City that is not based on any agreed-upon calculation.
1 Veolia North America also operates and maintains sanitation infrastructure in other communities.
Considering the amount of time and effort that the City has committed to coordinating with EPASD, the lack of progress to date essentially has created a development moratorium in the City. The City's land use authority is being significantly compromised, as funding demands from EPASD may prevent all development from moving forward.
In addition to this major concern, the City submits other information in response to the Draft MSR, including:
• Failure to implement the capital improvement plan for the aging sanitary sewer infrastructure poses a public health and safety risk to current East Palo Alto residents and impedes even minor development such as accessory dwelling units by existing rate payers
• City Attempts to Interface with EPASD of Policy Initiatives and Development Projects • City Grant Experience Since 2010|
• Additional Meetings and Coordination
Failure of EPASD to Implement Capital Improvement Plan (CIP) The MSR documents that aside from improvements needed for new development, there is an estimated cost of $23.9 million to replace and upsize pipe sections to eliminate potential surcharges and sanitary sewer overflows (SSOs). The District's failure to implement the CIP poses health and safety risk to the current rate payers. In addition, current residents are unable to obtain "will serve letters" for accessory dwelling units permitted by State law and the City General Plan.
City Attempts to Interface with EPASD on Policy Initiatives and Development Projects
On several occasions, representatives from the EPASD stated publicly they have not been informed of the City's General Plan/Zoning Update, nor have they received notice of new development projects being considered for City approval. However, the current chair of the EPASD Board of Directors is acknowledged as a key contributor in the City's General Plan document. Regarding notification about potential City development projects, the table below illustrates the submission timeline for key policy documents (General Plan/Development Code) that are required to be submitted by the City to all agencies for each project. All the documents identified in the chart below also are available in the State Clearinghouse database located at: https://ceqanet.opr.ca.gov
CITY POLICY DOCUMENTS SUBMISSION TIMELINE
(Notice of Final EIR
Policy/Project Draft EIR
Preparation) NOP
General Plan Update 3rd September, 2014 January, 2016 August, 2016 Zoning Update 3rd September, 2014 N/A- Exempt N/A- Exempt Primary School 18th May, 2017 5 November, 2018 April, 2019 965 Weeks N/A-MND N/A-MND N/A - MND
Light Tree N/A-MND N/A-MND N/A - MND
Sobrato Phase Il 18th May, 2017 December, 2018 September, 2019 2020 Bay Road | 18th May, 2017 TBD TBD
The project notification process involves documented communication with EPASD, in addition to invitations to community meetings that have been extended to the District.
City Grant Experience Since 2010
As mentioned in the Draft MSR, the City has pursued many grants to support essential projects, in alignment with the infrastructure and construction needs of the City. In the last ten years, the City has received more than $110 Million in Federal, State, County, and other grants to support City infrastructure projects and initiatives. An additional $18 Million in grants is pending, as the City awaits notification of potential awards.
Not every grant application submitted by the City has been successful, but every grant process is beneficial because the City gains an understanding of possible improvements to future applications. Since 2010, the City has submitted grant proposals amounting to $31 Million that were not selected.
Many grant and low-interest loan options could be sought to improve the sanitation infrastructure immediately. The City agrees that significant efficiencies in planning and seeking financing for the City's water system and sanitation infrastructure may be achieved.
Additional Meetings and Coordination
From May through October 2020, the City of East Palo Alto - East Palo Alto Sanitary District (EPASD) Joint Intergovernmental Committee (Committee) hosted seven meetings to identify strategies for advancing City-approved development projects, with specific attention to projects requiring entitlements from EPASD. The Committee was comprised of two EPASD Board Directors and two City Council members.
While City staff is grateful the Committee was reestablished to discuss critical topics of mutual importance for EPASD and the City, the work of facilitating, hosting, supporting, and managing all meetings was the sole burden of the City. Due to a reported lack of capacity and interest by EPASD, the City was required to draft all meeting reports in accordance with the Brown Act and host every virtual meeting. As such, the City contributed hundreds of staff hours, including City Clerk and City Attorney time, while EPASD provided very little assistance to supporting these joint meetings and offered little in collaboration.
From past practice, these joint meetings will continue to present an unbalanced burden on the City unless different expectations are established. For example, the City would consider the joint meetings be conditioned upon two things: 1) the District matching staff time in conducting the joint meetings and 2) the joint meetings focus on the illustrative CIP Finance Plan contained on page 147 in the MSR.
In conclusion, the City is greatly appreciative of the thorough analysis in the Draft MSR and the recommendations aimed at resolving documented inadequacies of the sewer infrastructure, lack of a CIP, and impasse regarding a funding formula to eliminate an intractable barrier to the achievement of critical City goals. For the past decade and beyond, the City has consistently built its capacity to attain economic self-sufficiency, through policy decisions, funding options, and strategies that result in beneficial development. The current issue of ensuring the District's sanitation infrastructure can support City-approved development is a challenge that must be resolved so all residents may benefit from citywide improvements and mindful growth. say tha
Patrick Heisinger
Interim City Manager