COUNCIL AGENDA REPORT
TO: Mayor and City Council
FROM: Brett Fulgoni, Director of Public Works
DATE: August 4, 2026
SUBJECT: Adoption of a Resolution Approving a Pipe Line Crossing License Agreement with Santa Maria Valley Railroad, LLC
Description:
The City Council will consider authorizing a Pipe Line Crossing License Agreement with Santa Maria Valley Railroad, LLC, for a sanitary sewer pipeline crossing beneath the railroad right -of-way associated with the Stowell Distribution Warehouse sewer improvements.
Environmental Notice: The project was adequately covered in a previously certified Final Environmental Impact Report for the Stowell Road Package Warehouse Project (SCH# 2025080640) pursuant to California Environmental Quality Act State Guidelines Section 15162. None of the conditions specified i n Section 15162 requiring the preparation of a subsequent EIR have occurred. No further environmental review is required.
RECOMMENDATION:
1. Adopt a Resolution approving a Pipe Line Crossing License Agreement with Santa Maria Valley Railroad, LLC; and
2. Authorize the City Manager, or designee, to execute the agreement.
BACKGROUND:
The City is constructing sanitary sewer improvements that require installation of a 48-inch sanitary sewer pipeline beneath the Santa Maria Valley Railroad right-of-way near Stowell Road. Santa Maria Valley Railroad requires execution of a Pipe Line Crossing Licen se Agreement prior to construction within its property. The agreement grants the City a perpetual license to construct, operate, maintain, repair, replace, and relocate the sewer pipeline crossing, subject to the terms and conditions of the agreement, incl uding payment of a one-time $25,000 license fee.
DISCUSSION:
Santa Maria Valley Railroad requires that the agreement be executed by an authorized representative of the City before construction activities may begin within the railroad right- of-way. Approv al of the proposed Resolution authorizes the Mayor, or designee, to execute the agreement.
2 Execution of the agreement will allow the City to proceed with construction of the sanitary sewer crossing required for the Stowell Distribution Warehouse sewer improvements. The agreement includes standard railroad provisions regarding construction requirements, maintenance obligations, indemnification, insurance, and future relocation of the facility if required by railroad operations.
Alternative(s)
Council may choose not to adopt the Resolution. Without an executed license agreement, the City would be unable to construct the sewer crossing within the railroad right-of-way, delaying completion of the sewer improvements.
Fiscal Considerations
Execution of the Pipe Line Crossing License Agreement requires payment of a one-time license fee of $25,000 to Santa Maria Valley Railroad, LLC, as required under the agreement. In accordance with the conditions of the Stowell Distribution Warehouse development, the developer will be responsible for payment of the license fee and all costs associated with the agreement, including any required railroad review, construction, and related expenses. Therefore, approval of the Resolution will have no fiscal impact on the City's General Fund and does not require an additional budget appropriation. The City will retain ownership and long-term responsibility for the sewer facilities upon acceptance of the public improvements.
Impact on the Community
Approval of the Resolution will allow execution of the Pipe Line Crossing License Agreement, enabling construction of a critical sanitary sewer crossing beneath the Santa Maria Valley Railroad right -of-way. The sewer improvements will support existing and planned development while ensuring co ntinued reliable wastewater infrastructure and uninterrupted railroad operations.
ATTACHMENT(S)
A. Resolution
B. Agreement