CITY OF PACIFICA
CITY COUNCIL MINUTES
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Mayor Mary Bier
Mayor Pro Tem Tygarjas Bigstyck
Councilmember Mike O'Neill
Councilmember Sue Vaterlaus
Councilmember Sue Beckmeyer
City Council Special Meeting 1 February 15, 2022
SPECIAL MEETING
February 15, 2022 (TUESDAY)
6:00 PM
www.cityofpacifica.org
Mayor Mary Bier called the meeting to order on February 15, 2022 at 6:02 PM 6:00 PM OPEN SESSION
Call to Order
Mayor Bier called the meeting to order at 6:02 p.m.
Attendee Name Title Status Arrived
Mary Bier Mayor Present
Tygarjas Bigstyck Mayor Pro Tem Present
Mike O'Neill Councilmember Present
Sue Vaterlaus Councilmember Present
Sue Beckmeyer Councilmember Present
City Clerk Coffey took a verbal roll call.
Staff Present: Kevin Woodhouse, City Manager; Megan Burke, Asst. City Attorney; Tina Wehrmeister, Asst. City Manager/Planning Director; Lisa Petersen, PW Director; Yulia Carter, Chief Financial Sustainability Officer; Maria Aguilar, Wastewater Plant Manager; Brian Martinez, Collection System Manager-Wastewater; Nelson Schlater, Senior Engineer; Jason Bustria, IT Analyst; Sarah Coffey, City Clerk.
Reading of Land Acknowledgment
City Clerk Coffey explained the conditions for having Council meetings pursuant to the provisions of Government Code Section 54953 (as amended by AB 361) which authorizes teleconferenced meetings under the Brown Act during certain proclaimed states of emergency.
She also explained that the public can observe and participate in the meeting via the Zoom link provided in the Agenda or by phone to the dial-in number and Webinar ID provided in the Agenda. This meeting can also be viewed live via local TV Channel 26 or online at City Council Special Meeting 2 February 15, 2022
www.cityofpacifica.org/LiveStream. City Clerk Coffey also gave information on how to present public comments via email or live if participating by Zoom or phone.
Mayor Bier read the Land Acknowledgment.
Salute to the Flag led by Councilmember Vaterlaus
Mayor Bier asked for confirmation that they will not have Oral or Council communications because it is a special meeting.
City Clerk Coffey confirmed that is correct.
CONSIDERATION
1. A Resolution of the City Council of the City of Pacifica Stating Its Intention to Hold a Public Hearing and Consider Updating the City’s Sewer Service Charges Beginning Tax Year 2022-2023 for a 5-year period from FY 2022/23 to FY 2026/27 and Provide Direction on Sewer Capacity Fees Related to Accessory Dwelling Units.
PROPOSED ACTION: Move to Adopt a Resolution of the City Council of the City of Pacifica Stating Its Intention to Hold a Public Hearing and Consider Updating the City’s Sewer Service Charges Beginning Tax Year 2022-2023 for a 5-year period from FY 2022/23 to FY 2026/27 and Provide Direction on Sewer Capacity Fees Related to Accessory Dwelling Units.
PW Director Petersen introduced the city team, and consultants from Bartle Wells. She began the staff report, then turned to the consultant to continue the presentation.
Michael DeGroot, consultant of Bartle Wells, continued the presentation.
PW Director Petersen completed the presentation.
Councilmember O’Neill asked, if they waive lower fees for an ADU that is below market rent, how that would be enforced and are held accountable for following through with that.
PW Director Petersen asked if they can get Asst. City Attorney Burke to respond to that question.
Asst. City Attorney Burke stated that they have put some thought in how they would structure the program to ensure that they are in compliance with the law and not triggering prevailing wage for the project while ensuring that the units would be restricted in terms of the rent moving forward. She stated that a lot of cities have programs where they don’t charge for ADUs at all because they see ADUs as naturally more affordable type of residential unit or they don’t charge fees for those ADUs that agree to be rent restricted moving forward. She stated that they can have them enter into an agreement, but they need to create a resolution that lays out that the fee is not due for any rent restricted unit and that it is a choice by the developer / applicant and how the agreement would be set forth.
Councilmember O’Neill stated that the state used to have a program for seniors where they could waive their property taxes by having a lien put on the property and, at some point when City Council Special Meeting 3 February 15, 2022
the house changed owners, the property taxes would be paid back, and asked if it would be possible for an ADU to put a lien on the property for the amount of the fees and, at some point, if they refinanced or sold, the city would get the fees for the ADU.
Asst. City Attorney Burke stated that she would have to look into that to figure it out as she was not aware of any cities doing it that way. She thought there may be practical issues with administering that kind of program, depending on how many and whether or not it was worth it.
She stated that they can look into that if Council is interested.
Councilmember Vaterlaus stated that she never heard of a program like that, and stated that she would look it up. She stated that the thing about what is affordable today versus what was affordable tomorrow is that the rates for rents are increasing and she didn’t know how you determine that. She thought there were standards on what income is for affordable housing, but they are also very high now. She wasn’t sure how they would determine that.
Mayor Bier opened public comments.
There were no public comments.
Councilmember O’Neill didn’t know how popular ADUs would be in Pacifica because of the parking situation, mentioning Fairmont, etc., where they get chronic complaints for parking and vehicle traffic. He understood why people want to do ADUs, but he hasn’t thought through waiving the fees for the sewers as that was a major capital expense. He stated that the park fees they discussed at the previous night’s meeting, those are more of a soft cost but this is a hard cost to the city. He was interested in other people’s thoughts.
Mayor pro Tem Bigstyck stated that the thought he had when they had the meeting in advance sticks to him even though it is overly simplistic. It occurred to him that an ADU would probably be $7,800 in fees and at the meeting he thought about what it would look like if it was only $5,000 instead of $8,000. He thought his concern about lowering it was that somehow the fee would be prohibitive in someone’s mind for constructing an ADU that would be helpful to the city. He didn’t know of lowering it would make a difference one way or the other, and that was a thought he wanted to explore in any appropriate way.
Mayor Bier thought the ADUs were important to Pacifica because we don’t have a lot of multifamily buildings and no one is coming in to build them. She stated that, if we are going to create housing for our community, this is one way we can, and for her, incentivizing that is really important. She referred to Councilmember Vaterlaus’ question, stating there was a formula that they use.
Councilmember O’Neill referred to the thought that they are not allowed to make a profit on something and are only allowed to recoup our costs for doing this, and for the city to waive the fees on an ADU would be an actual cost to the enterprise fund, and he asked if that subsidy would have to be made up somewhere else in rates or do ADUs count towards our RHNA numbers.
Asst. City Manager/Planning Director Wehrmeister stated that they do.
Councilmember O’Neill asked, based on the theory that they are not allowed to make a profit on something, if there was another rate that would have to increase in order to subsidize waiving fees or reducing fees for ADUs.
City Council Special Meeting 4 February 15, 2022
Asst. City Manager/Planning Director Wehrmeister stated that she wasn’t sure if she was answering his question, but she has a suggestion as ADUs are important and they came up at the previous meeting as well as this meeting. She suggested that, during our housing element process, we dive into and look at whether or not our fees are in a more scientific way cost prohibitive to construction, as now we are looking at them fee by fee and worrying about whether or not we’re impacting that type of development. She thought it was better to have a more scientific way of looking at it and, if they have fees that could be impactful, at that point, they can do that through a housing program and figure now they can mitigate that rather than sell themselves short on each fee as it comes along.
Councilmember O’Neill stated that, if this fee is waived and it has to be made up somewhere else in order to keep this in the enterprise fund, then a woman who got a $500 social security check but no loan on their house is going to be subsidizing it. He stated that the minimum sewage fee would have to go up. He stated that seniors can waive parcel taxes but not bonds.
He stated that there is no way they could waive a minimum sewage fee because they are pertaining to a service.
Councilmember Beckmeyer wanted to follow up on what Asst. City Manager/Planning Director Wehrmeister was saying about looking at this when they work on the housing element and looking at all of our fees across the board. She thought that was already on their docket and in other conversations they have had, the answer has been that they will look at that when they look at the overall fees. She asked how postponing would bear on what was before them at this time, i.e., if they make a decision or direction to staff and in a year they look at their fees and how would they change it or what catch up would they do. She asked what the process would be.
PW Director Petersen asked to clarify that she was talking about the capacity fee if they postpone implementing that.
Councilmember Beckmeyer stated that, if they say they are not going to charge and ADU, but they then look at it later and say that they should be or they should charge them half or something like that. She was trying to understand the difference between what they were being asked to look at during this meeting and how it could be impacted by looking at their fees as a separate project.
Mayor Bier thought it was interesting that she saw it the other way around, as when Asst. City Manager/Planning Director Wehrmeister described it, she thought they were going to go ahead with it at this meeting and then look at the housing element and then see if they have to reduce things.
Mayor pro Tem Bigstyck stated that is how he was looking at it.
Mayor Bier thought it was interesting that they look at it differently.
Councilmember Beckmeyer thought it was because they are not charging it presently, and all jurisdictions that have ADUs charge it.
PW Director Petersen stated that they are probably not charging the fee for ADUs. She would ask the question to consultants Doug Dove or Michael DeGroot. It is a good question that, if people aren’t paying these fees, then who is absorbing that cost. She thought the answer would City Council Special Meeting 5 February 15, 2022
probably be the people who currently are paying the fees and paying through the capital improvement program.
Asst. City Attorney Burke thought she could address that question and some of the other ones that have come up. She stated that, if you don’t charge the full amount for ADUs, your sewer utility is an enterprise fund and it doesn’t receive additional funds from other sources so if you don’t charge, you always have the discretion to not charge a full capacity fee, but if not charging a full capacity fee, there is some amount of money that needs to be picked up from other sources. She stated that, for an ADU, if you’re not having a ton of ADUs, and you look at your overall budget for the utility, it is probably not a significant amount of money that is being distributed elsewhere but, if you are not recouping funds from capacity of new developments, you do have to get those funds from somewhere else. She stated that, as far as the timing in terms of what you would do in this process, your capacity fees have not been updated since 1974. She stated that it has been a long time and they are in desperate need of an update aside from the ADU issue and it is usually good practice, since they are moving forward with updating sewer service charges and sewer rates, that they do it at the same time as it is involving the same CIP plans and the same financial projections and you’re having your Proposition 218 public hearing for the sewer rates anyway. It is a good practice to try to update the sewer capacity fees and the sewer rates at the same time. She stated that, if they are uncertain and they feel like the ADU fees themselves may need some additional study or thought, she agreed with Asst. City Manager/Planning Director Wehrmeister’s thoughts that it might be a good idea to move forward with adopting the capacity fees which apply to all types of development, not just ADUs, and also maybe adopt a specific amount that would apply to ADUs because you have to calculate those fees a little bit differently as you do it by drainage fixture unit or square footage in your case drainage fixture unit. She stated that they can have the ADUs fees not go into effect for another year or it could go into effect immediately and, as they study it, it was probably not going to be that many ADUs between the adoption of the fees and when they put in a potential program in the future. She stated that she would have them deal with it by adopting the capacity fees now, including an ADU fee and then either keeping the ADUs fees from going into effect immediately or adjusting it with some program in the future.
Wastewater Collection System Manager Martinez added that it has been said that they haven’t charged anything for ADUs and that is not exactly correct. He stated that they currently have a municipal code on the books for second units, and the ADU term is new and there are a lot of laws regarding ADUs that have happened in the past couple of years. He stated that, historically, Pacifica always did charge for second units and it was exactly 50% of the cost of your first unit, which is in the municipal code on the books presently. He stated that, with all the ADU laws that came along a couple of years ago, they said you have to charge proportionately, not just have a flat rate for an ADU. He stated that, when those laws came out, that was the point where they stopped charging for ADUs, but they did charge for ADUs, before they were referred to as ADUs but also in the beginning when they were referred to as ADUs, they were charging 50% of the cost of a single family resident.
Mayor pro Tem Bigstyck thought this was not a public hearing and they were not adopting fees until the public hearing. He thought with a tremendous lack of public presence to get feedback, when they have a public hearing after this meeting’s direction to go ahead with the fee, that is an opportunity for the public to tell them whether or not their inclination that this might be cost prohibitive and bear out in public thought or not, and as they take the steps to conclude whether they want to mitigate some of the fees for the sake of affordable housing, he thought they have plenty of time to gather data from staff and the public to draw those conclusions as they go forward with the fee decision.
City Council Special Meeting 6 February 15, 2022
Councilmember O’Neill asked if it would be possible to have four affordable ADUs, not regular ADUs, with a monitoring program that there be an additional charge on new connections that go into a fund that would be used to subsidize the affordable housing ADUs. He thought the sewer lateral issue is kind of structured as it was a fine to either the water agency or put it in to help fix sewer laterals, and they are fixing sewer laterals every year from some fund. He asked if they could do something like that or ADUs and build it into the rate structure or new connections, i.e., ADU fee.
PW Director Petersen thought that was probably something they would have to look into.
Asst. City Attorney Burke wasn’t sure she understood 100% how the program would work as he conceptualized it, but they can only charge as part of the rate what the actual cost of service is, and even though they don’t have an obligation as an agency to charge a capacity fee at a certain amount and it will obviously have other impacts. She stated that, if they want to use the funds for other things, like affordable housing, they could not use the service rate revenue and they would have to look into other revenue sources and they would need to make sure the sewer rates are not funding programs beyond what the sewer service costs are.
Councilmember O’Neill asked, if the RHNA numbers are a state mandate, whether that was a cost of doing business for the city since they are required to provide affordable housing and the fees they would be charging would be going into a specific fund for ADUs and affordable housing.
Asst. City Attorney Burke stated that it would be like separate fee, apart from sewer service and apart from sewer capacity for funding affordable housing.
Councilmember O’Neill thought it would stay only for sewer charges for affordable housing.
Asst. City Attorney Burke stated that it would be assessed.
Councilmember O’Neill stated that she was the lawyer and would have to figure it out, adding that he tells City Attorney Kenyon that Council says what they want to do and she finds a legal way to do it. He stated that the state has mandated that we need 1.900 housing units and that is set in stone. He concluded that it is a cost of doing business, just like being told to put up stop signs, street lights, etc., and he asked, to subsidize affordable housing to reach the state mandate, if they can charge full fee sewer connections on affordable housing fee or affordable connection fee for ADUs, or possible affordable housing. He didn’t know how far they can stretch that.
Mayor Bier asked Asst. City Manager/Planning Director Wehrmeister if she wanted to comment.
Asst. City Manager/Planning Director Wehrmeister stated that, if she understands Councilmember O’Neill’s suggestion correctly, she thought the answer is yes, but it may be different from how he stated it. She thought cities regularly do charge impact fees for affordable housing to development but not tied to sewer fees at all. She stated that it would be a policy decision for Council, but perhaps they would not penalize ADUs with that fee but attach that to market rate housing rather than the ADUs as you would just make it more expensive to construct the ADUs. She concluded that, yes, they can as it is a program that many cities have and she thought he suggested that it be on their work plan in association with construction commercial square footage as well. She reiterated that it is yes, but not in conjunction with this City Council Special Meeting 7 February 15, 2022
particular fee program.
Asst. City Attorney Burke agreed with her. She stated that, to charge fees on new development, you have to charge them based on their impact. Since the sewer impacts are separate from any impact on affordable housing, it would not be part of the sewer fees, but there are impact fees that are charged to fund affordable housing and are more common on commercial developments, but there are impact fees that some cities have for essential development as well.
Councilmember O’Neill thanked Asst. City Manager/Planning Director Wehrmeister for reinterpreting it for him.
Councilmember Beckmeyer stated that, in regard to the upgrade to wastewater treatment plant photovoltaic system and UV different section system upgrades, if she is doing her math correctly, she stated that it will cost the city $1.5 million to upgrade the solar and they will save $200,000, and they have a 7 1/2 year payback on that. She stated that our UV disinfection system is $11.5 million and the city will save about $400,000 a year, so a 27.5 year pay back.
She asked how long a UV disinfection system lasts, such as how long has the current one lasted, as she is not sure if it was 20 years or so.
PW Director Petersen stated that it is a great but complicated question because their current UV system could probably keep it going for a few more years if they could get the manufacture to provide them with those parts, but they are discontinuing parts so they can’t keep it going. She stated that one of the things they will be doing as they move forward with this project, they will be talking with these manufacturers and one of the conversations will be how long they will be supporting this fix-up. Staff feels that a lot of it is going to be related to how long they will be willing to support this system and they will be digging into once they get into this project and talking with potential vendors.
Councilmember O’Neill asked if they will make it a part of the contract.
PW Director Petersen responded affirmatively.
Councilmember O’Neill referred to them saying 20 years support. In regard to staffing, he stated that Western Cities had an article about what Hayward did, which was that with their sewer treatment plant they put in enough solar power where they were actually doing their street lights and saved $400,000 a year on the street lights, but Pacifica doesn’t have enough land to put that out. He stated that they opened up a dialogue and brought in high school students to learn the chemistry that they have in sewer treatment plants to try to start teaching locals when went on and jobs for them later on in life. He stated that former Asst. City Manager Hines talked to the City Manager about this and he thought this was one of the best things he has ever seen. He asked if it was possible for them to open up a dialogue with the high school to look at for chemistry students.
PW Director Petersen knows that they are trying to do more outreach to students generally and that is one of the jobs they have for one employee. She stated that part of the problem they have been having is the whole Covid issue. She thought Wastewater Collection System Manager Martinez can probably talk about what kind of outreach he has done with them previously. Regarding bringing them in, she knows that Wastewater Plant Manager Aguilar does a lot of plant tours and she wasn’t sure if she brought in and taught local high school students but they were having a recent conversation with a group.
City Council Special Meeting 8 February 15, 2022
Wastewater Plant Manager Aguilar stated it was BayWorks.
PR Director Petersen stated that they were having a conversation with BayWorks and are local community college students studying wastewater and they are trying to bring them in for internship program. She stated that they were having conversations with BayWorks now and they are sending staff information. She thought they could have staff look into having some sort of conversations with high school students as well.
Councilmember O’Neill stated that he will email her the article about Hayward, and if they get in touch with former Asst. Manager Hines, he can talk to her about it, as he loved that program.
Councilmember Beckmeyer asked if Jefferson High School still has a CTE person, stating that it was Karen Gnusti at one point, but she asked if there was still a position for that in the administration.
Councilmember O’Neill asked if it was the CTE person, he didn’t think there was that he knows.
He added that the unions would be happy if they were recruiting girls for this, as they have a whole program just to recruit women for these kind of jobs.
PW Director Petersen stated that BayWorks program is broad, serving under-privileged students, and that was who they were specifically talking about for interns for wastewater. She thought that sounded interesting and she would love to read that article.
Councilmember Beckmeyer loved that idea. She referred to Councilmember O’Neill’s excellent point on that potential tie-in with workforce development. She had a general thought on this topic, i.e., in light of the fact that fees haven’t been looked at since 1974 and it harkens to her about so many things that have been on hold or not addressed over decades. She wanted to commend staff now as she feels like part of what is bringing this forward is the professional level of our staff and the recognition of how a city stays solvent and how fees all play into those aspects. She appreciates and understands, from a rational standpoint and from a dollars and cents standpoint, why this is so important, but unless and until it is brought forward and put before Council to make a decision on it and give direction, it doesn’t happen and it clearly hasn’t happened for a very long time in Pacifica. She referred to the theme from the previous night’s meeting, stating that this is another aspect of the quality of staff and she thanked them and appreciated them bringing Council into the current century on this and she thought it will help serve our community going forward as this is the kind of thing where they are recouping costs and addressing the actual capacity needs so we have money to keep building our system out and improving the service in our community.
Councilmember O’Neill stated that, when this comes to Council for public decision and public meeting, etc., he thought Wastewater Collection System Manager Martinez might have this; i.e., mentioning that, when he first got on Council, he did a whole infrastructure PowerPoint and went to groups and gave the presentation about 10-12 times. He stated that there was a video of the infiltration, ILI, that looked like it was a waterfall, and someone from the sewer treatment plant sent it to him, and he thought that would be a great visual to show why the city needs to do what they are doing. He didn’t know if he knows where it is or if it might possibly still be on his own computer.
PW Director Petersen stated it was a great idea. She stated that they will look for it.
City Council Special Meeting 9 February 15, 2022
Councilmember O’Neill stated that he was picking on Wastewater Collection System Manager Martinez as he thought he was the longest term person there.
Wastewater Collection System Manager Martinez thought, if they don’t have it, they can make another one easily.
Councilmember O’Neill thought that would be a great visual.
Mayor Bier thought they can bring the conversation back to the item specifically, and she asked Asst. City Manager/Planning Director Wehrmeister if could explain one more time that, if they move forward at this meeting to hold the public hearing, including the ADU fees, then when they do the housing element they can look at that again as she thought she needs a little clarity.
Asst. City Manager/Planning Director Wehrmeister suggests what she thinks is already part of what housing elements will study, and they will look at what our processes are for constructing housing and whether or not there is any barriers to housing, including the fees that the city charges. They would not only look at this fee as it relates to ADUs or other affordable housing, but also other fees. She stated that there is a potential that our fees may not be cost prohibitive and even at an affordable level, that is something that is doable for the financing of an ADU and then, in that case, it would be good for Council to know that instead of deciding to reduce or eliminate fees before that factor is even known.
Mayor Bier thanked her for repeating the options again, as she sometimes needs to hear things more than once.
Councilmember Vaterlaus stated that she sees the need for all of these projects, and thought she should speak up on them. She thought the ADU fees are too high but she can wait until they do the housing element and they can look into that. She wants people to build affordable housing and she didn’t see, if they start adding all the fees, park fees, sewer fees, impact fees, etc., then people won’t build anything. She stated that we obviously have to have things built.
She wouldn’t mind lowering it now or making it half, but she can wait.
Councilmember O’Neill moved to adjourn the meeting.
City Clerk Coffey stated that they need a motion to adopt the resolution before they adjourn.
Mayor pro Tem Bigstyck moved to adopt a Resolution of the City Council of the City of Pacifica stating its intention to hold a Public Hearing and Consider Updating the City’s Sewer Service Charges Beginning Tax Year 2022-2023 for a 5-year period from FY 2022/23 to FY 2026/2027 and Provide Direction on Sewer Capacity Fees Related to Accessory Dwelling Units; seconded by Councilmember Beckmeyer.
City Clerk Coffey took a vote by verbal roll call.
RESULT: ADOPTED [UNANIMOUS]
MOVER: Tygarjas Bigstyck, Mayor Pro Tem
SECONDER: Sue Beckmeyer, Councilmember
AYES: Bier, Bigstyck, O'Neill, Vaterlaus, Beckmeyer
ADJOURN
Mayor Bier adjourned the meeting at 7:09 p.m.
City Council Special Meeting 10 February 15, 2022
Transcribed by Barbara Medina, Public Meeting Stenographer.
Respectfully Submitted,
Sarah Coffey, City Clerk
APPROVED: 5 - 0; 2/28/2022
__________________________
Mary Bier, Mayor