ITEM 4. 6
CITY MANAGER' SREPORT
SEPTEMBER 14, 2026 CITY COUNCIL REGULAR MEETING
ITEM: POLICY AND PROCEDURE TO PRIORITIZE WATER
AND SEWER SERVICE FOR AFFORDABLE HOUSING
DEVELOPMENT
RECOMMENDATION: Adopt Resolution to Approve a Policy and Procedure to Prioritize Water and Sewer Service for Affordable
Housing Development
SUMMARY:
The City of Lathrop' s 2023-031 Housing Element requires the City to establish conformance with Program # 4 ( Priority Sewer and Water for Affordable Housing) of its Housing Element by adopting policies and procedures to provide priority water service for developments that include lower income housing units pursuant to California Government Code Section 65589. 7.
BACKGROUND:
In 2005, the State Legislature of California enacted Chapter 727 ( Senate Bill 1087), which amended California Government Code Section 65589. 7to require all public and private utility providers of water and sewer services to grant priority for such services to proposed developments that include housing units that are affordable to lower income households. -
Furthermore, California Government Code Section 65589. 7 (as amended with Senate Bill 1087) also requires that all public agencies that provide water and sewer services to adopt written policies and procedures with specific objective standards by July 1, 2006, and at least once every five ( 5) years thereafter, to establish such priority for affordable housing projects. Since the City of Lathrop is its own water and sewer provider, the City of Lathrop is subject to compliance with the requirements of California Government Code Section 65589. 7.
ANALYSIS:
Lower income households are defined in California Health and Safety Code Section 50079.. as people and families whose income does not exceed the qualifying limits for lower income families as established and amended from time to time by the federal government under Section 8 of the United States Housing Act of 1937.
Developments that qualify for service prioritization must include units reserved for lower income households that are sold or rented at an affordable cost under the terms of California Health and Safety Code 50052. and 50053. Senate Bill 1087 requires all agencies providing sewer or water services to adopt written policies and CITY MANAGER' S REPORT PAGE 2
SEPTEMBER 14, 2026 CITY COUNCIL REGULAR MEETING
POLICY AND PROCEDURE TO PRIORITIZE WATER AND SEWER SERVICE FOR
AFFORDABLE HOUSING DEVELOPMENT
procedures with specific objective standards for providing the priority service by July 1, 2006, and once every five ( 5) years thereafter. ,
The policy must account for regulations and restrictions relating to water shortage emergencies, water supply availability as described in an urban water management plan and existing agency policies used to administer service determinations.
The City Council is being asked to approve the attached resolution, policy, and procedures, so that the City will continue to maintain compliance with its 2023-031 Housing Element and with California Government Code Section 65589. 7. Once approved, the City will begin implementing the service prioritization policy. The policy will be revised ( if necessary) and brought to the City Council at a minimum of every five ( 5) years to maintain compliance with Senate Bill 1087.
CEQA REVIEW:
This action does not constitute a project within the meaning of the California Environmental Quality Act under Public Resources Code Section 21065. It has no potential to cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment and, therefore, does not require environmental review.
REASON FOR RECOMMENDATION:
Staff recommends that the City Council approve the proposed policy and procedure to prioritize water and sewer service for affordable housing development.
FISCAL IMPACT:
There is no fiscal impact to the City of Lathrop, only staff time to prepare the report.
ATTACHMENTS:
A. Resolution to Approve a Policy and Procedure to Prioritize Water and Sewer Service for Affordable Housing Development.
B. City of Lathrop Policy and Procedure to Prioritize Water and Sewer Service for Affordable Housing Development.
CITY MANAGER' S REPORT PAGE 3
SEPTEMBER 14, 2026 CITY COUNCIL REGULAR MEETING
POLICY AND PROCEDURE TO PRIORITIZE WATER AND SEWER SERVICE FOR
AFFORDABLE HOUSING DEVELOPMENT
APPROVALS:
1/ 0616
Bra f
Taylor Date
Pub is Works Director / City Engineer
9 • Z - Zo2( 0
Michael King Date
Assistant City Manager
9, Log
Salvador Navarrete Date
City Attorney
Stephen J. Salvatore Date
City Manager
RESOLUTION NO. 26 -
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LATHROP TO
APPROVE A POLICY AND PROCEDURE TO PRIORITIZE WATER AND SEWER
SERVICE FOR AFFORDABLE HOUSING DEVELOPMENT
WHEREAS, the State Legislature of California has enacted Chapter 727, Statues of 2005 ( SB 1087), which amends California Government Code Section 65589. 7 and requires water and sewer providers to grant priority water and sewer services for proposed developments that include housing units affordable to lower income households; and
WHEREAS, the City of Lathrop' s2023-031 Housing Element requires the City to establish conformance with Program # 4 ( Priority Sewer and Water for Affordable Housing) of its Housing Element by adopting policies and procedures to provide priority water service for developments that include lower income housing units pursuant to California Government Code Section 65589. 7; and WHEREAS, proposed developments that include housing units affordable to lower income households are defined as dwelling units that shall be sold or rented to lower income households, as defined in Section 50079. of the California Health and Safety Code, at an affordable housing cost, as defined in Section 50052. of the California Health and Safety Code, or an affordable rent, as defined in Section 50053 of the California Health and Safety Code; and
WHEREAS, California Government Code Section 65689. 7requires that the public agency that provides water and sewer services adopts written policies and procedures, not later than July 1, 2006 and at least once every five ( 5) years thereafter, to establish such priority for affordable housing projects; and WHEREAS, the City of Lathrop is the water and sewer provider for the City of Lathrop and is, therefore, subject to the requirements of Government Code Section 65589. 7; and
WHEREAS, this action does not constitute a project within the meaning of the California Environmental Quality Act under Public Resources Code Section 21065. It has no potential to cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environmental and, therefore, does not require environmental review; and
WHEREAS, the City of Lathrop staff has prepared the required policy and procedures listed as attached" Attachment B" of the September 14, 2026 Staff Report in compliance with California Government Code Section 65589. 7.
Resolution No. 26-
NOW THEREFORE, BE IT RESOLVED, by the City Council of the City of Lathrop does hereby approve the policy and procedures to prioritize water and sewer services for proposed developments that include housing units affordable to lower income households, as provided in the City Council Policy listed as " Attachment B" of the September 14, 2026 Staff Report that accompanied this resolution.
Resolution No. 26-
The foregoing Resolution was passed and adopted this 14th day of September 2026, by the following vote of the City Council, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Paul Akinjo, Mayor
APPROVED AS TO FORM:
Teresa Vargas, City Clerk Salvador Navarrete, City Attorney Resolution No. 26-
Attachment B
Ciity of
Lahro;p
DATE: September 14, 2026
RESOLUTION NO.: 26 -
SUBJECT: Water and Sewer Service Priority Policy for Proposed Developments that include Housing Units Affordable to
Lower Income Households.
PURPOSE
The purpose of this policy is to establish conformance with Program # 4 ( Prior Sewer and Water for Affordable Housing) of the City of Lathrop' s2023-031 Housing Element and with California Government Code Section 65589. 7 by memorializing written procedures to prioritize water and sewer service needs for proposed developments that include housing units affordable to lower income households.
POLICY
In accordance with Senate Bill 1087 and California Government Code Section 65589. 7, the City shall grant sewer and water service priority for proposed developments that include housing units affordable to lower income households as defined in Section 50079. of the California Health and Safety Code.
PROCEDURE
The following definitions shall apply to this policy:
1. "Proposed developments that include housing units affordable to lower income households" means that dwelling units shall be sold or rented to lower income households, as defined in Section 50079. of the California Health and Safety Code, at an affordable housing cost, as defined in Section 50052. of the California Health and Safety Code, or an affordable rent, as defined in Section 50053 of the California Health and Safety Code.
2. "Water or sewer services" means the supply of a service through a pipe or other constructed conveyance system for residential purposes. This does not include the resale of water for human consumption from one water supplier to another. This also does not include passing sewerage from one sanitary agency' scollection system to another.
Attachment B
This policy shall be implemented and enforced per the conditions listed herein:
1. Based upon existing regulations and restrictions relating to water shortage emergencies, coupled with the availability of the water supply as determined by the City of Lathrop, the Public Works Director/ City Engineer shall ensure that priority for waterandsewer services is given to proposed developments that include housing units affordable to lower income households.
2. The City shall not deny or condition the approval of an application for water or sewer services to, or reduce the amount of services applied for by, a proposed development that includes housing units affordable to lower income households unless the City makes specific written findings that the denial, condition, or reduction is necessary due to the existence of one of the following:
a. The City does not have " sufficient water supply as defined, by Section 66473. 7(a)( 2) of the California Government Code.
b. The City is operating under a water shortage emergency as defined by Section 350 of the California Water Code.
c. A written engineering analysis and report demonstrate the existing water distribution system does not have sufficient water distribution capacity to serve the proposed development.
d. A written engineering analysis and report demonstrate the existing sewerage collection system does not have sufficient collection capacity . to serve the proposed development. :
e. The State Water Board Division of Drinking Water, State Water Resources Control Board, Central Valley Regional Water Quality Control Board and/ orthe San Joaquin County Department of Environmental Health issues an order to the City that prohibits new water connections or that prohibits new sewer connections.
f. The developer has failed to agree to reasonable terms and conditions relating to the provision of service generally applicable to development projects seeking service from the City, including, but not limited to, the requirements of local, state, orfederal laws, codes, standards, regulations or payment of a fee or charge imposed pursuant to California Government Code Section 66013.
3. The City shall revisit, revise ( if necessary) and readopt an update to these procedures and policies at least once within five ( 5) years of the issuance date.