EFAST
EAST PALO ALTO SANITARY DISTRICT
BOARD OF DIRECTORS 901 Weeks Street
ethzabe Yañez, Presider East Palo Alto, CA 94303
lartha Stryker, Vice Presider Phone: (650) 325-9021
Glenda Savage, Secretary Fax: (650) 325-5173
Joan Sykes-Miessi, Director www.epasd.com
Dennis Scherzer, Director
Akin Okupe, M.B.A, P.E., General Manager
September 14, 2022
NATURE OF ITEMS
This item is required to discuss options at financing infrastructural upgrades for development projects pursuant to the need of the 2035 General Plan of the City of East Palo Alto.
BACKGROUND
East Palo Alto Sanitary District and the City of East Palo Alto have been discussing ways of funding the needed infrastructure to provide wastewater services that meets the requirements of the 2035 General Plan. A master plan addendum was prepared by consultants that identified the needed upgrade required. According to the master plan addendum, it would cost approximately $40 million to upgrade the present infrastructure to serve the proposed development as contained in the 2035 General Plan.
STAFF COMMENTS/RECOMMENDATIONS
In view of the need to fund the infrastructural upgrade, staff researched various steps as discussed below:
1. Raising the connection fees: A consultant was hired to calculate a new connection fee that will incorporate the projects identified in the Master Plan Addendum. In pursuant to this, the consultant prepared the attached report. This option will require a rate increase as identified in the rate study report prepared by Alex Handlers of Bartle Wells and Associates.
2. Capital Improvement Plan: A contractor was hired to perform a closed-circuit televised monitoring of the collection system; this project is still ongoing. It is the intention of the District to spend $18 million of the reserve to repair old mains that are in deplorable conditions. A capital project in excess of $20 million dollars have been identified so far.
3. Rate study: The rate study report prepared by Bartle wells revealed that the rate would need to go as high as $1100 to be able to bond the infrastructures needed for development project. This total amount excludes the Capital Projects for existing rate payers.
4. Mello-Roos Tax: This option is still work in progress, a consultant has been hired to come up with a plan for the implementation of this strategy, this is an alternative to the Capacity fees option. It will require coordination with developers and voters' approval.
ACTION OPTIONS
There are no actions needed at this time
NEXT STEPS
The District will be scheduling meetings with developers to identify options of mutual benefits
3. Rate study: The rate study report prepared by Bartle wells revealed that the rate would need to go as high as $1100 to be able to bond the infrastructures needed for development project. This total amount excludes the Capital Projects for existing rate payers.
Mello-Roos Tax: This option is still work in progress, a consultant has been hired to come up with a plan for the implementation of this strategy, this is an alternative to the Capacity fees option. It will require coordination with developers and voters' approval.
ACTION OPTIONS
There are no actions needed at this time
NEXT STEPS
The District will be scheduling meetings with developers to identify options of mutual benefits