STAFF REPORT
City of Lancaster
HA CC 2
9/8/2026
TN
Date:September 8, 2026
To:Mayor Parris and City Council Members
From:Patti Garibay, Director - Community Development
Becky Bartlett, Manager – Community Development
Subject:Cost Recovery Program from Lahontan Regional Water Quality Control Board for Housing and Neighborhood Revitalization-1
Recommendations:
1.Approve the Cost Recovery Program from Lahontan Water Quality Control Board (LRWQCB) in the amount not to exceed $200,000 as the agreement continues in full force and effect until project completion.
2.Authorize the City Manager, or his designee, to finalize and execute all documents related to the Cost Recovery Program.
G.C. Section 84308: No
Fiscal Impact:
Amount not to exceed $200,000 as the agreement continues in full force and effect until project completion. Funding for the current fiscal year is available in Account No. 314.22000.5710.
Background:
The Housing Authority owns Housing and Neighborhood Revitalization-1 (HNR-1), which consists of twenty (20) parcels totaling approximately 5.7 acres located on the southwest corner of West Avenue I and Sierra Highway in a residential and commercial area of Lancaster.
Prior to the City’s acquisition, HNR-1 was developed with residences, retail businesses, gas stations, and automobile repair facilities. All the previous structures were demolished between approximately 2003 and 2011. HNR-1 is currently vacant and unpaved.
Soil and soil vapor sampling conducted between 2021 and 2024 at HNR-1 identified subsurface impacts in soil, soil vapor, and groundwater. The predominant chemical of concern 2 5
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(COC) is perchloroethylene (PCE), which was identified primarily in the Western portion of the Subject Property. Based on the results of off-site soil vapor samples, Waterstone Environmental Inc. (Waterstone) conducted off-site indoor air sampling in residential properties to the south and commercial properties to the north to evaluate the potential for vapor intrusion. No PCE was detected in any indoor air samples.
Waterstone and City staff met with LRWQCB on December 2, 2024, to discuss the Subject Property’s history and findings to date. On December 27, 2024, the LRWQCB sent the City an Initial Cost Recovery Program letter. The Cost Recovery Program proposal is prepared on an annual fiscal-year basis, and a new proposal will be submitted each fiscal year. The Housing Authority received authorization for spending on April 8, 2025.
Porter-Cologne Water Quality Control Act (California Water Code), section 13304, allows the California Regional Water Quality Control Board, Lahontan Region (Water Board), to recover reasonable expenses from responsible parties to oversee the cleanup and abatement of discharges that have adversely affected waters of the State. A cost recovery account will be established for the HNR-1 project, and through that account, the Regional Water Board will charge labor costs for regulatory oversight associated with cleanup efforts at the site. LRWQCB has determined, based on on-site characterization investigations, that there are impacts to the subsurface and groundwater that warrant the need for additional investigations and cleanup of solvents and petroleum hydrocarbons.
LRWQCB estimates that it will require approximately 60 hours at a cost of $245 per hour during Fiscal Year 2026-2027 to perform oversight activities associated with the project.
The LRWQCB is required to provide the City of Lancaster annually with the following information:
1. A detailed estimate of the work to be performed or services to be provided, including a statement of the expected outcome of that work, based upon data available to the agency at the time;
2. The billing rates for all individuals and classes of employees expected to engage in the work or services; and
3. An estimate of all expected charges to be billed to the responsible party by the agency.
Estimate of Work to be Performed
Water Board staff estimates that the following work will be performed during Fiscal Year 2026- 2027 (July 1, 2026, through June 30, 2027):
1. Review and comment on semi-annual groundwater monitoring reports and investigation or remedial action work plans and reports;
2. Conduct site visits and/or technical consultations (e.g., meetings and/or telephone conversations with you or your consultant), phone calls, and meetings to keep informed on the remediation progress; and
3. Prepare any necessary written correspondence, such as internal Water Board communications (e.g., memorandum, meetings, and briefings to management or Board Members), administrative billings, annual cost estimate letter, or other relevant documentation.
The Cost Recovery Program is set up so that reasonable expenses incurred by governmental agencies, such as the Regional Water Boards, in overseeing water quality cleanup matters, can be recovered from the discharger/responsible party. City Staff will meet with the City Attorney regularly to monitor progress and invoices. 2 5
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Attachment:
Exhibit A – Annual Estimate for Cost Recovery Program – W. Avenue I Properties (East) Exhibit B - Annual Estimate for Cost Recovery Program – W. Avenue I Properties (West)