Title
Adoption of a Resolution Authorizing the Interim City Manager to Enter into a Joint Exercise of Powers Agreement (JPA) Establishing and Governing Operation of the Collection System Technical Advisory Committee, and a Defendant’s Side Agreement to Facilitate the Environmental Protection Agency Sewer Consent Decree Compliance. (Public Works 602)
Body
To: Honorable Mayor and Members of the City Council
From: David L. Rudat, Interim City Manager
EXECUTIVE SUMMARY
The City of Alameda is one of seven sewer collection systems tributary to the regional wastewater treatment plant, owned and operated by the East Bay Municipal Utility District (EBMUD). Aging sewer collection pipes allow stormwater to enter the wastewater system, increasing flows in excess of the capacity of EBMUD’s treatment plant. This leads to discharge of only partially treated sewage to the Bay. The tributary agencies and EBMUD entered a Joint Exercise of Powers Agreement (JPA) in 1979 (Exhibit 1), with amendment in 1986 (Exhibit 2), to combine resources to address wet weather flows. The agencies have continued to use this outdated agreement until this proposed JPA (Exhibit 3), developed to address the work requirements in the 2014 Final Consent Decree and allow for continued benefit from economies of scale.
The Side Agreement (SA) to Facilitate Consent Decree Compliance (Exhibit 4) specifies a defendant cost allocation for a Performance Evaluation Plan, an arbitration for any revised work plan disagreement, and contains a Roles and Responsibilities arrangement between the City of Alameda and EBMUD regarding implementation of the Regional Private Sewer Lateral Program.
BACKGROUND
The City of Alameda owns and operates the local sanitary sewer collection system comprised of sewer pipes, pump stations, and other facilities. The City discharges the sanitary flow to large interceptor pipes owned by the EBMUD where it is conveyed to a regional treatment plant, also owned by EBMUD. The City is considered one of seven tributary agencies (a tributary agency contributes wastewater to EBMUD’s treatment plant) to the regional treatment plant located near the base of the Bay Bridge. The other tributary agencies include the cities of Berkeley, Albany, Piedmont and Oakland and the Stege Sanitary District (El Cerrito, parts of Richmond, and Kensington).
Each of the tributary agencies have separate sanitary sewer collection systems from the system that collects and conveys stormwater flow. Aging sewer infrastructure has many cracks and other imperfections that allow stormwater to enter sewer pipes and manholes. During wet weather events, stormwater in the sewer system, also known as infiltration and inflow, can lead to a significant increase in the volume of wastewater conveyed to the regional wastewater treatment plant. This volume can exceed the capacity of EBMUD’s treatment plant and lead to only partially treated discharges of sewage to the Bay.
The City and the six other tributary agencies, along with EBMUD, entered a JPA in 1979, with an amendment in 1986. The JPA, still active today, did not form a separate public entity but was developed in response to the need for the agencies to combine resources to address inflow and infiltration concerns. In the 1980’s and 1990’s, EBMUD built three wet weather facilities (WWFs), pursuant to authority from the State Water Resources Control. These facilities provide treatment in the form of solids removal and disinfection, but do not provide secondary treatment before being discharged into the San Francisco Bay. During this time, the tributary agencies also invested significant funds to address local capacity issues, sanitary sewer overflows, and cross connections between the sewer and storm systems. The JPA enabled the agencies to contract for and administer common services to realize cost savings through economies of scale. EBMUD is the lead agency and is responsible for entering into contracts on behalf of the agencies, and providing financial and administrative services to the group.
In 2004, the EPA concluded that secondary treatment was needed at the WWFs as discharges from these facilities failed to meet water quality regulations in the California Toxics Rule, promulgated in May of 2000. EPA issued a Cease and Desist Order to EBMUD for the WWFs, filed suit against EBMUD and a separate suit against each of the tributary collection systems, including the City of Alameda. The primary objective of EPA's actions were to force an aggressive program to minimize sanitary sewer overflows and reduce infiltration and inflow by the tributary agencies, thereby reducing the wet weather flow to the regional treatment plant. The lawsuits were combined and settled with the terms of the settlement codified in the 2014 Final Consent Decree for Case Nos. C09-00186 and 09-05684.
Although the agencies have continued to use the JPA, it is outdated. The proposed JPA updates the chronology of regulatory action and refines the stated purpose of the agreement to include coordination on individual and jointly funded Consent Decree projects so that tributary agencies can benefit from valuable services at a cost that continues to benefit from economies of scale.
Consent Decree compliance is assessed annually for each agency based on the performance of specified work. In addition, to evaluate whether the work being performed is actually reducing wet weather flows such that the WWFs no longer discharge, there is a check-in for each facility at 2022 and 2030. If a WWF fails the specified benchmark, a Performance Evaluation Plan and Work Plan Revision Process is required for the contributing tributary agencies to that WWF. It is recognized that this future process may invite disputes among the tributary agencies and EBMUD regarding the sources of excess flow and the best means to reduce flow in a revised work plan. The City’s wastewater flow is tied to the San Antonio and Oakport facilities, as are the cities of Oakland and Piedmont. The SA proposed here ensures joint, productive communication between these four agencies to ensure that any individual agency’s work positively affects the results for the entire system.
DISCUSSION
Joint Powers Agreement (JPA)
The City and seven other agencies party to the 2014 Consent Decree negotiated and updated a new JPA. The new JPA is needed to continue to coordinate on engineering, maintenance and other services related to infiltration and inflow reduction from the City’s sanitary sewer system. It will also facilitate the efficient flow of information among the parties and the filing of joint reports to appropriate recipients, including regulatory agencies. As before, the new JPA does not create a new public entity, but simply is an agreement among parties, similar to what was done in the 1979 JPA, as amended in 1986.
The new JPA more specifically includes the ability to designate one or more party as being responsible for financial and administrative matters, and a process for replacing that party if required or necessary. Each party is responsible for overhead costs and their proportionate share of any contractual agreement. It establishes a governance structure and authority with regard to decision-making and contracting among the parties. There is an opt-out provision for any contract, as participation in contracts is discretionary with no obligation to participate. Any party can withdraw from the JPA at any time.
Defendants’ Side Agreement (SA)
The SA to Facilitate Consent Decree Compliance specifies cost allocation among the agencies should a Performance Evaluation Plan be required at either the 2022 or 2030 WWF check-ins. It also specifies an arbitration for any disagreement among the Consent Decree defendants regarding revised work plans. Lastly, the SA to Facilitate Consent Decree Compliance contains a Roles and Responsibilities arrangement between the City of Alameda and EBMUD regarding implementation of the Regional Private Sewer Lateral program.
Both agreements are needed for the successful implementation of the City’s Consent Decree obligations and for effective collaboration with the other tributary agencies in reducing wet weather flows to the regional wastewater treatment plant. These agreements will help protect ratepayers and the City from stipulated fines under the Consent Decree and/or other litigation involving the City’s sewer collections system.
FINANCIAL IMPACT
Approval of the JPA and SA have no impact to the General Fund. Any funds expended through these Agreements will first be appropriated by the City Council in either Sewer Fund operations or Sewer Fund capital budget. Following public notification and hearing, the City Council adopted an annual 3% rate increase through Fiscal Year (FY) 2021-22 based on the February 2015 Sewer Rate Study. The rate study's 20-year cash flow projection concluded that based on existing information, an annual consumer price index rate increase will suffice to comply with Consent Decree requirements. If benchmarks are not achieved at the 2022 and/or 2030 check-ins and additional City work requirements result, the following five-year rate study will consider the financial implications of the additional work when proposing rates for the subsequent five years. The City Council can then decide whether to move forward with the Proposition 218 public hearing required to increase sewer rates.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
Approval of the JPA and SA do not affect the Municipal Code.
ENVIRONMENTAL REVIEW
Approval of these agreements is not a project under the California Environmental Quality Act as they create a government funding mechanism of other government fiscal activity that do not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. CEQA Guidelines, Section 15378(b)(4).
RECOMMENDATION
Adopt a resolution authorizing the Interim City Manager to enter into a Joint Exercise of Powers Agreement establishing and governing operation of the Collection System Technical Advisory Committee and a Defendant’s Side Agreement to facilitate Consent Decree Compliance.
Respectfully submitted,
Liam Garland, Public Works Director
By,
Erin Smith, Deputy Public Works Director
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibits:
1. 1979 JPA
2. 1986 JPA Amendment
3. New JPA
4. Side Agreement