The URL can be used to link to this page

Home My WebLink About1973-05-23TELE PH ON ES: COUNTY SANITATION DISTRICTS OF ORANGE COUNTY, CALIFORNIA AREA CODE 714 540-2910 962-2411 P. 0. BOX Bl 27, FOUNTAIN VALLEY, CALIFORNIA 92708 10844 ELLIS AVENUE (EUCLID OFF-RAMP, SAN DIEGO FREEWAY) Gentlemen: May 18, 1973 NOTICE OF ADJOURNED REGULAR MEETING DISTRlCT NO. 2 WEDNESDAY, MAY 23, 1973, 5:00 P,M, 10844 ELLlS AVENUE FOUNTAIN VALLEY, CALIFORNIA Pur3uant to adjournment of the regular meeting held May 9, 1973, the Board of Directors of County Sanitation District No. 2 will meet in an adjourned regular raeeting at the above hour and date. . ~ p !J Secrifary JWS:rb MEETING DATE May 23 . 1 97~_ TIME 5 :00 . p .m . DISTRICTS 2 ~~~~~~~~ DISTRICT 1 JOINT BOARD'S PATTERSON. ·(CASPERS) ••••• BATTIN •••• PORTER •••• . (MILLER) • • • • • • SALTARELLI DISTRICT 2 / °'!!P~ (~TEVENS) ••••• NEVIL ••••• · -v -±~-t ( :JPERS) •• • • • CLARK·· U!i -r _L_,J--;f CULVER • • -r . JI '/ ~CHAPUT) • • • • • • LANGER) • • • • • • KOWAL$ KI) • • • • SCOTT) ••••••• 6'' WliE@;" ,,. • • --_JL.!. FINNELL··. _..;_ -:f-'/_j, FOX······· --f----+.-¥___:/_ JUST ••••• ·rii.:--4-V ~ PATTERSON .vw._/ _ __j_Y _J:_ ~REINH~RDT) • • • ROOT······ -1-_:f_f _l PEREZ) ••••••• SMITH····· ___{_ __;j__t __J_ DUTTON) •••••• STEPHENSON --1-__:f__f _i_ DUNNE) ••••••• WINN •••••• --_i_ i _N_ DISTRICT 3 (KOWALSKJ) • • • • FOX······· ------ (CASPERS)· •• •• BATTIN···· ------ CULVER···· ------ !Hl NEs )°. · • • .. · DAVIS .. ••• ------ MATNEY)··.··· GREEN····· ------ Ml LLER) •••• • • LONG· • • • • • -·-----· MARSHOTT •• --____ . MC ~~HI NNEY --__ -- PATTERSON. ------ . ROBERTS ••• ------· (REi NHARDT) • • • ROOT·· •••• --___ _ !BLACKMAN) • ."·. -SALES· •• •• _____ _ HOLLI NPEN). •• .. SCOTT ••• •• _____ _ DUTTOl) ······STEPHENSON NEVIL ••••••• STEVENS ••• ========== BYRNE ••••••• VANDERWAAL _____ _ DISTRICT 5 ~CROUL~ ••• ~ ••• MC INNIS •• ----- BAKER ••••••• CASPERS ••• ------ KYMLA ••••• ----- .I DISTRICT 6 PORTER •••• -----~CASPERS) ••••• BATTIN •••• ------ MC INNIS) •••• STORE ••••• ------ ·DISTRICT 7 ~SALTAREyLI) •• MILLER •••• ------ CASPERS ••••• CLARK ••••• ------ PATTERSON. ------ PORTER •••• ------ !BURTON) •••••• QUIGLEY ••• ----- MC IN~I S ) •••• ROGE RS •••• ------ P ~REZ ••••••• SMITH ••••• ------ D ~fRICT 11 rATNEY) •••••. GI BBS ••••• ------ CASPERJ) ••••• BAKER ••••• ------ MATNEY •••••• DU KE ••••• ·• ----- DISTRICT 8 ~JOHN S ON) • • • • • BOYD·· • • • • ----- CLARK) • • • • • • • CA SPERS ··· ------ MITCHELL·· ----- 6113173 !LANGER) ••••• CASPERS) •••• CASPERS) •••• (CASPERS) •••• HINES) •••••• MATNEY) ••••• CHAPUT) ••••• KOWALS l<I) ••• MATNEY) ••••• SCOTT) •••••• MC INN l S) ••• Ml LLERJ ••••• (SAL TAREl-LI) • (STEVENS) •••• (BURTON) ••••• MC INNIS) ••• RE I NHARDT)) •• BLACKM~N ••• MILLER) ••••• HOLLI ND~N) •• PEREZ) •••••• DUTTON) ••••• NEVIL) •••••• MC INlis) ••• BYRNE •••••• DUNNE •••••• FINNELL. •••• --- BAKER ••••••• ---· - BATTIN •••••• ---- CASPERS ••••• --- CLARK ••••••• ---- CULVER •••••• ---- DAVIS ••••••• ---- DUKE •••••••• ---- EWING ••••••• ----. FOX ...•..... ---- GREEN ••••••• --- JUST ...•.... ---- KYMLA ••••••• ---- LONG •••••••• ---- MARSHOTT •••• -· --- MATNEY •••••• ---- MC INNIS •••• ___ _ MC WHINNEY •• --__ MILLER •••••• ___ _ NEVIL ••••••• ___ _ PATTERSON ••• ___ _ PORTER •••••• ___ _ QUIGLEY ••••• ___ _ ROBERTS ••••• ___ _ ROGERS •••••• ___ _ ROOT •••••••• ___ _ SALES ••.••••• ___ _ SALTARELLI •• ___ _ SCOTT •.•••••• ___ _ SMITH ••••••• ___ _ STEPHENSON •• ___ _ STEVE NS ••••• ___ _ STORE ••••••• ___ _ VANDERWAAL •• ___ _ WINN •••••••• ___ _ * * * * * OTHERS HARPER v' ~r SYLVESTER ~ LEWIS ·v- DUNN bJ ' CLARKE TAYLOR / BROWN ~ Jr-c.L ~N ·'(lt-.tv2 .BLISS BOETTNER CARLSON FINSTER GALLOWAY HOHENER HOWA RD . HUNT ~ KEITH ---T- ~ KENNEY ~ LYNCH MADDOX ~ fJn_u,j__ MARTINSON PIER SALL STEVENS l\EETIN U DATE Ma y 2 3 . 1 9 7 1 _ TIME 5 :00 p.m . DISTRICTS 2 -"""'-,......------ 31 STRICT 1 JOINT BOA RD'S . PATTERSON. (.CASPERS) ••••• BATTIN •••• PORTER •••• (MILLER) • • • • • • SALTARELLI ! LANGER) ••••• CASPERS) •••• CASPERS) •••• ~ISTRICT 2 e:~ ~ (CASPERS) •••• 10 /1/73 .~:;.; ($TEVEN3) ••••• ('-"'PERS) • • • •• ~CHAPUT) • • •••• LANGER) • • • • • • KOWAL$ KI) • • • • SCOTT)······· NEVIL •••••. ~ ..J:L_. _Y_ 7</ IHI NES) •••••• CLARK..... ~ Y _j__ MATNEY ••••• CULVER ~ _iL_ ~ _!:!___ CHAPUT~ ••••• i' ·1111~ .••.• ~ _&_ J.L_ KOWALSl<I) ••• F;£ NNELL. • • ~ _:j__ _:i.__ MATNEY) ••••• FOX ••••••• ~ _y_ _y _ !SCOTT) •••••• JUST ······ __u:::._-4.-....::f-MC INN s) .•. PATTERSO N d:. v=: ± ~ MILLER~····· RO 0 T • • • • • • -J,.....=--'i-. (REINH~RDT) ••• { PEREZ) •• • • ••• DUTTON)······ DUNNE) ••••••• DISTRICT 3 S MI TH ~~.· ,..-_:i_ ~ STEPHENSON --l:::::::-_:i_ _:f__ WINN······ _.l.:::=:.. _::f.__ _j__ (KOWALSKJ) •••• FOX .·····. ------ (CASPERS)····· BATTIN···· ------ . CULVER •••• ------ lH INES).·· ••• • DAVIS····· ------ MATNEY)······ GREEN····· ------ MILLER) •••••• LO NG ·····. -·-----· MARSHOTT. • --___ _ MC WH I NNEY _____ _ 'PATTERSO N. _____ _ ROBERTS ••• ______ · (REiNHARDT) ••• ROOT •••••• _____ _ !BLACK MAN)·.'.· -SALES····· _____ _ HOLLI NPEN ) •••. SCOTT ••••• _____ _ DUTTOl) • • • •• ~ STEPHENSON _____ _ NEVIL ••••••• STEVENS ••• _____ _ BYRNE ••••••• VANDERWAAL _____ _ (SALTAREl,.LI) • (STEVENS).· ••• (BURTON) ••••• MC INNIS) ••• RE I NHARDT) •• BLACKMl\N) ••• MILLER) ••••• HOLLI ND~N) •• PEREZ) •••••• DUTTON) ••••• NEVIL) •••••• MC INlIS) ••• BYRNE •••••• DUNNE •••••• FINNELL. •••• ---- BAKER ••••••• ---- BATTIN •••••• ---- CASPERS ••••• ---- CLARK ••••••• ---- CULVER •••••• ---- DAVIS ••••••• ---- DUKE •••••••• ---- EWING ••••••• ---- FOX ....•.... ---- GREEN ••••••• ---- JUST •••••••• ---- KYMLA ••••••• ---- LONG •••...•. --__ MARS HOTT •••• -· _ -- MATNEY •••••• ---- MC INNIS •••• --__ MC WHINNEY •• --__ MILLER •••••• ___ _ NEVIL ••••••• ___ _ PATTERSON ••• ___ _ PORTER •••••• ___ _ QUIGLEY ••••• ___ _ ROBERTS ••••• ___ _ ROGERS •••••• ___ _ ROOT •••••••• ___ _ SALES ••.••••• ___ _ SALTARELLI •• ___ _ SCOTT •.•••••• ___ _ SMITH ••••••• ___ _ STEPHENSON •• ___ _ STEVENS ••••• ___ _ STORE ••••••• ___ _ VANDERWAAL •• ___ _ WINN •••••••• ___ _ * * * * * DISTRICT 5 (CROUL) ••••••• MC INNIS •• (BAKER) ••••••• CASPERS ••• KYMLA ••••• DISTRICT 6 PORTER •••• ( CASPERS) • • • • • BA TT IN •••• (MC INNIS) •••• STORE ••••• DISTRICT 7 ------ .! (SALT ARE t,.LI) •• (CASPERS) ••••• ! BURTON) •••••• MC INNIS) •••• PEREZ) ••••••• MILLER .... ------ CLA RK •••. ·. ------ PATTERSON. ------ PORTER •••• ------ QUIGLEY ••• ----- ROGERS ..... ------ SMITH ••••• ------ D ~fR ICT 11 { MATNEY) ...... CASPERS) ••••• MATNEY) •••••• DISTRICT 8 GI BBS ••••• BAKER ••••• DUKE ••••• ·• (JOHNSO N) ••••• BOYD······ (CLARK)······· CASPERS··· MITCHELL·· 6113173 OTHERS HARPER SYLVESTER LEWIS DUNN CLARKE TAYLOR BROWN NISSON BLISS BOETTNER CARLSON FINSTER GALLOWAY HOHE NER HOWARD . HUNT KEITH KENNEY LYNCH MADDOX MARTINSON PIERSALL STEVENS MEETING DATE May 23 ,19 7 3 _ TIME 5 :00 p .rn . DISTRICTS 2 -------- IHSTRICT 1 , PATTERSON. ~.CASPERS) ••••• BATT! N •••• PORTER •••• ~MILLER) •••••• SALTARELLI DISTRICT 2 (~TEVENS) ••••• ( SPERS) • •••• iCHAPUT) • • • • • • LAN GER) •••••• KOWALSKI)···· SCOTT) ••••••• ~RE I NH(\RDT) ••• PEREZ) • • • • • • • DUTTON) • • • • • • DUNNE)······· DISTRICT 3 NEVIL ••••• CLARK····· CULVER •••• [' 113· •••• FINNELL ••• FOX •••.... JUST· • • • • • PATTERSON. ROOT •••••• SM I TH ••••• STEPHENSON WINN· .... • _:t_ __ . --_y_ __ .....li_ __ . -- _L_ __ _y_ __ -1---+--_L==== J_ __ J_ __ J)_ __ (KOWALSKJ) •••• FOX ••••• •• ------ (CASPERS)····· BATTIN···· ------ CULVER···· ------ !HINES)······· DAVIS····· ------ MATNEY) •••••• GREEN··.·. ------ MILL-ER) •••••• LONG·····. ------ MARSHOTT. • ----· __ MC WHINNEY _____ _ 'PATTERSON. _____ _ · ROBERTS ••• _____ _ (RE i NHARDT) ••• ROOT •• • • • • _____ _ !BLACKMAN)·.'·· -SALES····· _____ ._·. · HOLLI NPEN). ··.SCOTT ••••• _____ _ DUTTO~) •••••• STEPHENSON _____ _ NEVIL ••••••• STEVENS··. ____ _ BYRNE ••••••• VANDERWAAL _____ _ DISTRICT 5 (CROUL) ••••••• MC INNIS •• (BAKER) ••••••• CASPERS ••• KYMLA ••••• DISTRICT 6 PORTER •••• (CASPERS) ••••• BATTIN •••• (MC INNIS) •••• STORE ••••• ·DISTRICT 7 (SALT ARE l-LI ) •• (CASPERS) ••••• !BURTON) •••••• MC INNIS) •••• PJ::REZ) ••••••• Dl0'f RI CT 11 !MATNEY) •••••• CASPER$) ••••• MATNEY) •••••• DISTRICT 8 MILLER •••• CLARK ••• ~. PATTERSON. PORTER •••• QUIGLEY ••• ROGERS •••• SMITH ••••• GI BBS ••••• BAKER ••••• DUKE ••••• · • (JOHN SON)····· BOYD······ (CLARK) • • • • • • • CASPERS··· MITCHELL·· 6113173 ./ JOINT BOARDS !LANGER) ••••• CASPERS) •••• CASPERS) •••• (CASPERS) •••• ! HINES) •••••• MATNEY) ••••• CHAPUT) ••••• KOWALSKI) ••• MATNEY) ••••• !SCOTT) •••••• MC INNJS) ••• MI LLERJ ••••• (SALTAREl-LI). (STEVENS).· ••• (BURTON) ••••• MC INNIS) ••• RE I NHARDT) •• BLACKMAN) ••• MILLER) ••••• HOLLI ND~N) •• PEREZ) •••••• DUTTON) ••••• NEVIL) •••••• MC IN~IS) ••• BYRNE •••••• DUNNE •••••• FINNELL ••••• ---- BAKER ••••••• ---- BATT! N •••••• ---.- CASPERS ••••• ---- CLARK ••••••• ---- CULVER •••••• ---- DAVIS ••••••• ---- DUKE •••••••• ---- EWING ••••••• ---- FOX .•...•.... ---- GREEN ••••••• ---- JUST •••••••• ---- KYMLA ••••••• ---- LONG •••••••• ---- MARSHOTT •••• -· --- MATNEY •••••• ---- MC INNIS •••• ---- MCWHINNEY •• ___ _ MILLER •••••• ___ _ NEVIL ••••••• ___ _ PATTERSON ••• ___ _ PORTER •••••• ___ _ QUIGLEY ••••• ___ _ ROBERTS ••••• ___ _ ROGERS •••••• ___ _ ROOT •••••••• ___ _ SALES •••••••. ___ _ SALTARELLI •• ___ _ SCOTT ••••••• ___ _ SMITH ••••••• ___ _ STEPHENSON •• ___ _ STEVENS ••••• ___ _ STORE ••••••• ___ _ VANDERWAAL •• ___ _ WINN •••••••• ___ _ * * * * * OTHERS HARPER SYLVESTER LEWIS DUNN CLARKE .TAYLOR BROWN NISSON BLISS BOETTNER CARLSON FINSTER GALLOWAY HOHENER HOWARD HUNT KEITH KENNEY LYNCH MADDOX MARTIN SON PIERSALL STEVENS · II BOARDS OF DIRECTORS County Sanitation Districts of Orange County, California DISTRICT No. 2 ADJOURNED REGULAR MEETING MAY 23, 1973 -5:00 P,M , (1) Roll Call Post Office Box 8 127 10844 Ellis Avenue Fountain Valley, Calif., 92708 Telephones: Area Code 714 540-2910 962-2411 f I NAL A G E N D A 5/23/73 ADJ OURNi 11E N rs .... ::::-......... .. COMP & MILEAG E .... ~ FILES SET UP ....... k.':'.'.". ..... RESOLUTIO NS CERTIF IED.::- lffiERS WR ITTEN ............ .. MINUTES WRITTEN ........... .. MINUTES f1LED .....•• ~- (2) Appointment of Ch~irman pro tern, if ~ecessary -:::; (( w~ l\J..~ WJ..-i~ <\-ll'MITh~ ~ ~{)~ zc 3 (3) Public Hearing re proposed sewer connecti9n Ordinance No. 203, amending Uniform Connection and Use Ordinance No. 202 (a) . Open public hearing r- (b V-Report of financial cons·u1tant on funding ' District's requirements. See page "A" (c) Written communications received, if any ~ ~ Oral statements from those in attendance (e) Clos·e public hearing ,t1{4)J Consideration of Ordinance No. 203, an ordinance amending .V Uniform Connection and Use Ordinance No. 202. See page "B" BOIL CAL[ y_ ra__ ---- ( 5) Report of engineer on scheduling of Santa Ana River ~Interceptor, from Katella Avenue to La Palma, Contract 0. 2-14-2 ~"'5;:~-s·.~s- (6) Other business and communications, if any ( 7) Consideration of motion to adjourn \o~,c;; t..- SUMMARY OF FINDINGS AND RECOMMENDATIONS 1. To meet its existing and and anticipated future needs, District No. 2 iniUated a five year sewerage improvement program· which is estimated to cost more than $19 mil lion. In conj unction with six other Orange County sanitation districts, the District is in the process of upgrading jointly owned sewage treatment works to meet State water quality control standards. The estimated cost of upgrading jointly owned primary treatment facilities is approximately $21. 2 million. The consul ting engineers estimate the cost of activated sludge secondary treatment which eventu- ally will be required by Federal and State standards at approximately $100. 8 million. 2. On the basis of the consulting engineers• cost estimates and construction schedules, the Director of Finance has projected funding needs of District No. 2 to implemen~ its program; meet its share of estimated capital costs of the proposed joint treatment works improvement program; provide for the District's share of pro- jected operations and maintenance costs; and debt service costs on District bonds. Projected cash flow deficits range from approximately $1. 73 million in 1973/74 to $7. 62 million in 1975/76 dependent upon the level of sec.ondary treatment required to meet Federal and State standards. 3. In the absence of new substantial sources of revenue, general obligation bond finan·cing is the most practical and feasible financing alternative available to District No. 2 to implement its improvement program as scheduled. 4. Recent development trends within the area served by the District have indicated the following: a. A trend toward increased higher density residential types of development in the District. b. The potential property tax base provided by single family unit land uses tends to be significantly greater than the potential property tax base provided by a multiple family unit. c. Engineering data indicate average· daily flows per dwelling unit in single family residential land uses average about 385 gallons per unit. In high density resident_ial I.and uses, flows averaged about 256 gallons per day per unit I or approximately two-thirds that of lower density single family land uses. d. Within cities served by District No. 2 there are significant differences in present users of the District's sewerage facili- ties. Median value of owner occupied housing units ranges from $23, 900 to $32, 300. Population per owner occupied housing units ra.nges from 3. 5 to 4. 0. Agenda Item #3(b) A-1 District 2 e. Land values within the District have increased significantly in ..,,,,., recent years. Land suitable for low density residential devel- opment has increased from approximately $10, 000 to $12, 000 per acre in 1960 to current levels of $28, 000 to $30, 000. Land suitable for high density residential development is now. valued at approxima- tely $50, 000 per acre. Land suitable for commercial development is now valued at approximately $100, 000 per acre. f. ·The District's property tax base of $1. 085 billion consists of land having an assessed valuation of $421 million (39 percent of total tax base) and improvements on land which is owned and occupied by present property owners having an assessed: valuation of $664 million (61 percent of total tax base). 5. Demands ·tor sewerage services are created by two broad classifications: (1) present users, and (2) potential users (owners of improved or unimproved land not connected to the system but adjacent to it). A system of assessing and recov~ring the costs of these benefits must consider the following: a. Equity among present users. b. Equity among potential ~sers. c. Equity between present and potential users. The distribution of costs in relation to complete equity in all cases is highly un- likely. What must be attempted is the achievement of optimum equity in relation to the degree of benefits received by broad categories of present users and poten- tial users within the constraints posed by statutory provisions and J.,;ractical ad- ministrative procedures. · 6.· On the basis of our analyses, evaluations, and consideration to optimize equity among users and potential users of the District's sewerage system, it is our recommendation that the governing board of District No. 2 consider the use of a sewer connection fee as a new source of revenue. The purpose of the con- nection fee would be to recover costs of providing facilities in the near future which will have sufficient built-in capacity to serve future users. We also recom- mend that the connection fee· be made· applicable to connections made to a District owned facility or to any local collector sewer which discharges into the District's sewerage system. 7. As the basis fer formulating connection charges, we suggest unit costs of pro- viding trunk sewer and sewage treatment-disposal capacity. We estimate the unit costs of providing such facilities at approximately $557 ,500 per million gallons. · 8. As the basis for computing connection charge fees, we recommend that the governing board of District No. 2 consider using average anticipated sewage Agenda Item #3(b) A-2 District 2 flows from residential land uses which have served as the basis to design master plan trunk sewer facilities in District No. 2 9. Based on the estimated capital cost of providing sewerage facilities, pro- jected flows from residential land uses I and current land use developments within the District, it is recommended that consideration be given to the estab- lishment of a residential unit connection charge of $220. 10. Commercial and industrial uses were considered in the same manner as resi- dential uses. It is anticipated these uses will provide an average flow of 3, 555 gallons per day per acre. At a unit capital cost of $55. 75 for providing 100 gallons of sewerage capacity, the charge would be approximately $2, 000 per acre. On a square footage basis, the capital cost for sewerage facilities would be approximately $45 per 1, 000 square feet of the facility. This rate is sug- gested as a general guide in recognition of the wide variation in types of indus- . trial and commercial uses. It is suggested the charge for major types ·of indus- trial and commercial facilities be coordinated with the administration of the excess capacity connection fees of the Districts' Uniform Industrial Use Ordin- ance, on the basis of a close study of the capacity requirements, typ·e of dis- charge, number of employees, and other related factors. 11. Annual revenue from connection charges under rates suggested in this study · could provide as much as $1. 3 million on the basis of near-term develop- ment patterns anticipated in the District. 12. Based on the estimated revenue which may be derived annually from the suggested connection fees, the District could nearly meet its minimum cash deficit of $1. 73 million in 1973/74, assuming Federal and State st;1ndards will necessitate only 46 mgd of secondary treatment capacity, equivale.1t to activated sludge, for all Districts' flows. 13. Should full secondary treatment equivalent to activated sludge be required by Federal and State standards, anticipated connection fee revenue would only partly offset the estimated maximum cash flow deficit of $7. 62 million anti- _cipated in 19 7 5/7 6. 14. In view of the uncertainty of treatment level requirements and revenue real- ized from connection fees, it is recommended that consideration of the possible use of general obligation bond financing be deferred until additional information is made available relat.ive to treatment level requirements. 15. The recommended level of connection charges for District No. 2 is approxi- mately 12 percent low1~r than the level of charges recently adopted by Dis- trict· No. 3. This differential appears to result from the differences in topo- graph.Y of the Districts, their respective needs for pumping stations and force mains, and miles of sewer mains contained in each District's trunk sewer system. t • Agenda Item #3(b) A-3 District 2 16. District No. 2 master plan facilities are designed to serve areas presently outside the District's boundaries. If a connection fee policy is adopted by the Board, it is recommended that the rationale for computation of annexation fees be revised. A suggested rationale is to maintain the existing charge at its present level and escalate it annually. The suggested amount of annual es- calation in the annexation fee would be equivalent to the estimated property taxes paid to the District by the owner of an acre of raw land. Agenda Item #3(b) A-4 District 2 ORDINANCE NO. 203 . AN ORDINANCE AMENDING UNIFORM CONNECTION AND USE ORDINANCE NO. 202 The Board of Directors of County Sanitation District N0, 2 of Orange County, California, does ordain as follows: ARTICLE 1 Article 2 of Ordinance No. 202 is hereby amended by adding thereto the following sections: (o) District Connection Char~. Is a connection charge· imposed by District No. 2 as a charge for the use of District's sewerage facilities whether such connection is made dir.~ctly to a Dist.rict sewerage facility or to a sewer which ultiw~tely discharges into a Dist~ict ~ewerage facility. (p) District Sewerage Facility.· Shall mean any property belonging to County Sanitation District No. 2 used in the treatment, transportation, or disposal of sewage or industrial wastes. (q) Domestic Sewage. Shall mean the liquid and water-borne wastes derived from the ordina~y living processes, free from indus- trial wastes, and of such character as to permit satis~·actory disposal without special treatment, into the public sewer or by means of a private disposal system. (r) Sewerage Facilities. Are any facilities used in the collection, tr~nsportation, treatment, or disposal of sewage and industrial wastes. (s) Family Dwelling Building. Is a structure designed and used to ·house families and containing one or more dwelling units. (t) Dwelling Unit. Is one or more habitable rooms which are occupied or which are intended or designed to be occupied by one family with facilities for living, sleeping, cooking, and eating. c ' Agenda Item #4 B-1 District 2 (u) Floor Area. Is the area included within the surrounding exterior walls of a building or portion thereof, exclusive of vent shafts and courts. The floor area of a building, or portion thereof, not provided with surrounding exterior walls shall be the usable area ~ under the horizontal projection of the ro0f or floor above. (v) New Construction. Shall mean any structure under construc- tion for which a connection permit has not been issued prior to the effective date of this ordinance. (w) Other Terms. Any term not herein defined is defined as being the same as set forth in the International Conference of Building Officials Uniform Building Code, 1970 Edition, Volume I. ARTICLE 2 (a) Section (a) of Article 6 of Ordinance No. 202 is amended to read as follows: (a) District Connection Charges. Before any connection permit shall be issued, the applicant shall pay to the District or its agent the charges specified herein. Agenda Item #4 (1) Connection Charge for New Construction, Family Dwelling Buildings. For each new family dwelling building constructed, the connection charge shall be ~220 pe~ dwelling unit. (2) Connection Charge for Existing Family Dwelling Buildings. For the connection of each existing family dwelling building, the connection charge shall be $220 per dwelling unit. from and after August 1, 1973 .Permits shall be required for all such connections but will be issued without charge prior to for such existing family dwelling ~~~~~~~~~- buildings. B-2 District 2 Agenda Item #4 (3) Connection Charge for New Construction and Existing Structures, Other Than Family Dwelling Buildings. For all other new construction, including but not limited to commercial and industrial buildings, hotels and mctel·:: and pi;.blic :.uild:!.ng;:;, t!1e corniection charge shall be~ per 1000 square feet, or any portion thereof, of floor area contained within such construction, provided that the minimum connection charge for such new construction shall be $220 .. The permit charges for existing structures, other than family dwelling buildings, shall become effective ~A_u __ g_u_s_t __ l_, ___ 1~9~7~3 ___ and connection charges for such structures issued prior to ~~~~~~~~~ shall be without charge. (4) Connection Charge for Replacement Buildings. For new construction replacing former buildings, the connection charge shall be calculated on the same basis as provided in Paragraphs (1) and (3) hereinabove. If such replacement construction is commenced within two years after demolition or destruction of the former building, a credit against such charge shall be allowed and shall be the equivalent connection charge for the building being demolished or destroyed, calculated on the basis of current charges for new construction. In no case shall such credit exceed the connection charge .. (5) Connection Charges for Additions to or Altera- tions of Existing Buildings. In the case of structures where further new construction or alteration is made to · increase the occupancy of family dwelling buildings or the area of buildings to be used for other than family B-3 District 2 Agenda Item #4 d~elling buildings, the connection charge shall be $220· for each dwelling unit added or created and in the case of new construction other than family dwelling buildings, 1 t shall be $45 per 1000 square feet of adrlitlonal f1oo~· area co~tained within such new struction, provided that· the minimum connection charge for such construction shall be$220 .. When there are .addjtions to or alterations of structures other than family dwelling buildings that fall within the minimum square footage charge of$220·, a credit equal to the unused area shall be allowed. Such credit shall be available for a period of five years from the date of initial connection charge. (6) When Charge is· to be Paid. Payment of connec- tion charges shall be required at the time of issuance of the building permit for all construction within the District, excepting in the case of a building legally exempt from the requirement of obtaining a building permit. The payment of the sewer connection charge for such buildings will be required at the time of and prior to the issuing of a plumbing connect~ )n permit for any construction within the territorial limits of the _District. (7) Schedule of Charges. A schedule of charges specified ~erein will be on file in the office of the Secretary of the District and in the Building Department of each city.within the District. (8) Biennial Review of Charges. At the end of two years from the effective date of this ordinance, and every two years thereafter, the Board of Directors shall. review the charges established by this article, and if i~ its judgment such charges require modification, B-4 District 2 an amendment to this ordinance will be adopted establishing cuch modification . . ARTICLE 3 Section (b) of Article 6 of Ordinance No." 202 is amended by adding thereto Section (3) to read as follows: ( 3 ) When an excess ·capacity connection charge is payable by a user, as hereinabove provided, a · credit equal to the connection charge paid by the user, if any, shall be allowed against such excess capacity connection charge~ ARTICLE 4 Except as herein amended, Ordinance No.~202· is ratified .. arid reaffirmed. The' Chairman of the Board of Directors ·shall sign this Ordinance and the Secretary of the Districts shall attest thereto and certify to the passage of this Ordinance, .and shall cause the same to be published once in the Santa Ana REGISTER , a daily newspaper of general circulation, printed, published, and circulated in the District, within fifteen (15) days after the date of passage of this Ordinance by said Board of Directors and saij Ordinance ·shall take effect August 1, 1973 ~~----------~--------~----~~------~ PASSED AND ADOPTED by two-thirds of the entire Board of Directors of County Sanitation District No. 2 of Orange County, California, at a regular me~ting held on the day of ----- -----~~--~----~~~--' 1973. ATTEST: Secretary, Board of Directors of County Sanitation District Chairman, Board of Directors of County Sanitation District No. 2 of Orange County, California No. 2 of Orange_ County, California Agenda Item #4 B-5 District 2 -... II BOARDS OF DI RE CTO RS County San itation Di st ric ts of O ra nge County, Ca lifornia DI STRIC T No. 2 Pos t Off ice Box Bl 27 10844 Elli s Aven u e Founta in Valley, Ca lif ., 92708 T elephones: Are a Code 7 14 540-2910 962-24 11 Preliminary AGENDA 5/1 8/73 (1 ) Roll Call ADJOU RNED RE GUL AR MEE TI NG MAY 18, 1973 -5:0 0 P ,M, (2) Appointment of Chairman pro tern , i f necessary (3) Public Hearing re proposed sewer connection Ordinance No. ·203 , amending Uniform Connection and Use Ordinance No . 202 (a) . Open public hearing (b) Report of financial consultant on funding District's requirements . See page "A 11 (c) Written communications received, if any (d) Oral statements from those in attendance (e) Close public h e aring (4) Consideration of Ordinance No. 203, an ordinance amending Uniform Connection and Use Ordinance No . 202. See page '!B" (5) Report of engineer on scheduling of Santa Ana River Interceptor , from Katella Avenue to La Palma, Contract No . 2-14-2 (6) Other business and communications, if any (7 ) Consideration of motion to adjourn SUMMARY OF FINDINGS AND RECOMMENDATIONS 1. To meet its existing and and anticipated future needs, District No. 2 initiated a five year sewerage improvement program which is estimated to cost more than $19 mil lion. In conjunction with six other Orange County sanitation districts, the District is in the process of upgrading jointly owned sewage treatment works to meet State water quality control standards. The estimated cost of upgrading jointly owned primary treatment facilities is a_pproximately $21. 2 million. The consulting engineers estimate the cost of activated sludge secondary treatment which eventu- ally will be required by Federal and State standards at approximately $100. 8 million. 2. On the basis of the consulting engineers' cost estimates and construction schedules, the Director of Finance has projected funding needs of District No. 2 to implemen~ its program; meet its share of estimated capital costs of the proposed joint treatment works improvement program; provide for the District's share of pro- jected operations and maintenance costs; and debt service costs on District bonds. Projected casti flow deficits range from approximately $1. 73 million in 1973/74 to $7. 62 million in 1975/76 dependent.upon· the leve~ of secondary treatment required to meet Federal and State standards. 3. In the absence of new substantial sources of revenue, generul obligation bond finan·cing is the most practisal and feasible financing alternative available to District No. 2 to implement its improvement program as scheduled. 4. Recent development trends within the area served by the District have indicated the following: a. A trend toward increased higher density residential types of . development in the District. b. The potential property tax base provided by single family unit land uses tends to be significantly greater than the potential property tax base provided by a multiple family unit. c. Engineering data indicate average· daily flows per dwelling unit in single family residential land uses average about 385 gallons per unit. In high density residential land uses, flows averaged about 256 gallons per day per unit, or approximately two-thirds that of lower density single family land uses. d. Within cities served by District No. 2 there are significant differences in present users of the District's sewerage facili- ties. Median value of owner occupied housing units ranges from $23 ,900 to $32, 300. Population per owner occupied housing units "-"". ra.nges from 3. 5 to 4. O. ~genda Item #3(b) A-1 District 2 e. Land values within the Distrl.ct have increased significantly in recent years. Land suitable for low density residential devel- opment has increased from approximately $10, 000 to $12, 000 per acre in 1960 to current levels of $28, 000 to $30, 000. Land suitable for high density residential development is now valued at approxima- tely $50, 000 per a9re. Land suitable for commercial development is now valued at approximately $100, 000 per acre. f. ·The District's property tax base of $1. 085 billion consists of land having an assessed valuation of $421 million (39 percent of total tax base) and improvements on land which is owned and occupied by present property owners having an assessed valuation o~ $664 million (61 percent of total tax base). . 5. Demands ·for sewerage services are created by two broad classifications: (1) present users, and (2) potential users (owners of improved or unimproved land not connected to the system but adjacent to it). A system of assessing and re~overing the. co.sts of th~se benefits mu.st consid_er the following: · a. Equity among present users. b. Equity among potential users. c. Equity between present and potential users. The distribution of costs in relation to complete equity .in all cases is highly un- likely. What must be attempted is the achievement of optimum equity in relation to the degree of benefits received by broad categories of present users and poten- tial users within the constraints posed by statutory provisions and practical ad- ministrative procedures. 6. On the basis of our analyses, evaluations, and consideration to optimize equity among users and potential users of the District's sewerage system, it is our recommendation that the governing board of District No. 2 consider the use of a sewer connection fee as a new source of revenue. The purpose of the con- nection fee would be to recover costs of providing facilities in the near future which will have suffic.ient built-in capacity to serve future us~rs. We also recom- mend that the connection fee be made applicable to connections made to a Dj.strict owned facility or to any local collector sewer which discharges into the District's sewerage system. 7. As the basis fcr formulating connection charges, we suggest unit costs of pro- viding trunk sewer and sewage treatment-disposal capacity. We estimate the unit costs of providing such facilities at approximately $557, 500 per million gallons. · 8. As the basis for computing connection charge fees, we recommend that the governing board of District No. 2 consider using average anticipated sewage Agenda Item #3(b) A-2 District 2 flows from residential land uses w{lich have served as the basis to design master plan trunk sewer facilities in District No. 2 9. Based on the estimated capital cost of providing sewerage facilities, pro- jected flows from res_idential land uses, and current land use developments within the District, it is recommended that consideration be given to the e stab- lishment of a residential unit connection charge of $22 0. 10. Commercial and industrial uses were considered in the same manner as resi- dential uses. It is anticipated these uses will provide an average flow of 3, 555 gallons per day per acre. At a unit capital cost of $55. 75 for providing 100 gallons of sewerage capacity, the charge would be approximately $2, 000 per acre. On a square footage basis, the capital cost for sewerage facilities wo.uld be approximately $45 per l, 000 square feet of the facility. This rate is sug- gested as a general guide in recognition of the wide variation in types of indus-: trial and commercial uses. It is suggested the charge for major types ·of indus- trial and commercial facilities be coordi.na ted with the ad minis tra ti on of the excess capacity connection fees of the Districts'· Uniform Industrial Use Ordin- ance, on the basis of a close study of the capacity requirements, type of dis- charge, number of employees, and other related factors. 11. Annual revenue from connection charges under rates suggested in this study · could provide as much as $1. 3 million on the basis of near-term develop- ment patterns anticipated in the District. 12. Based on the estimated revenue which may be derived annually from the suggested connection fees, the District could nearly meet its minimum cash deficit of $1. 73 million in 1973/74, assuming Federal and State standards will necessitate only _46 mgd of secondary treatment capacity, equivalent to activated sludge, for all Districts 1 flows. 13. Should full secondary treatment equivalent to activated sludge be required by Federal and State standards, anticipated connection fee revenue would only partly offset the estimated maximum cash flow deficit of $7. 62 million anti- .cipated in 1975/76. 14. In view of the uncertainty of treatment level requirements· and revenue real- ized from connection fees, it is recommended that consideration of the possible use of general obligation bond financing be deferred until additional information is made available relat.ive to treatment level requirements. 15. The recommended level of connection charges for District No. 2 is approxi- mately 12 percent lower than the level of charges recently adopted by Dis- trict· No. 3. This differential appears to result from the differences in topo- graphy of the Districts, their respective needs for pumping stations and force mains, and miles of sewer mains contained in each District's trunk sewer system. Agenda Item #3(b) A-3 District 2 16. District No. 2 master plan facilities are designed to serve areas presently outside the District's boundaries. If a connection fee policy is adopted by the Board, it is recommended that the rationale for computation of annexation fees be revised. A suggested rationale is to maintain the existing charge at its present level and escalate it annually. The suggested amount of annual es- calation in the annexation fee would be equivalent to the estimated property taxes paid to the District by the owner of an acre of raw land. Agenda Item #3(b) A-4 District 2 ORDINANCE NO. 203 AN ORDINANCE AMENDING UNIFORM CONNECTION AND USE ORDINANCE NO. 202 The Board of Directors of County Sanitation District N0, 2 of Orange County, California, does ordain as follows: ARTICLE 1 Arti~le 2 of Ordinance No. 202 is hereby amended by adding thereto the following sections: (o) District Connection Char~. Is a connection charge· imposed by District No. 2 as a charge for the use of District's sewerage facilities whether such connection is made dir~ctly to a District sewerage facility or to a sewer which ultimately discharges into a Dist~ict ~ewerage facility. (p) District Sewerage Facility. Shall mean any property belonging to County Sanitation District No. 2 used in the treatment, transportation, or disposal of sewage or industrial wastes. (q) Domestic Sewage. Shall mean the liquid and water-borne wastes derived from the ordina~y living processes, free from indus- trial wastes, and of such character as to permit satis~'actory disposal without special treatment, into the public sewer or by means of a private disposal system. (r) Sewerage Facilities. Are any facilities used in the collection, transportation, treatment, or disposal of sewage and industrial wastes. (s) Family Dwelling Building. Is a structure designed and used to ·house families and containing one or more dwelling units. (t) Dwelling Unit. Is one or more habitable rooms which are occupied or which are intended or designed to be occupied by one family with facilities for living, sleeping, cooking, and eating. Agenda Item #4 B-1 District 2 (u) Floor Area. Is the area included within the surrounding exterior walls of a building or portion thereof, exclusive of vent shafts and courts. The floor area of a building, or portion thereof, not provided with surrounding exterior walls shall be the usable area under the horizontal projection of the roof or floor above. (v) New Construction. Shall mean any structure under construc- tion for which a connection permit has not been issued prior to the effective date of this ordinance. (w) Other Terms. Any term not herein defined is defined as being the same as set forth in the International Conference of Building Officials Uniform Building Code, 1970 Edition, Volume I. ARTICLE 2 (a) Section (a) of Article 6 of Ordinance No. 202 is amended to read as follows: (a) District Connection CharEes. Before any connection permit shall be issued, the applicant shall pay to the District or its agent the charges specified herein. Agenda Item #4 (1) Connection Charge for New Construction, Family Dwelling Buildings. For each new family dwelling building constructed, the connection charge shall be ~220 pe~ dwelling unit. (2) Connection Charge for Existing Family Dwelling Buildings. For the connection of each existing family dwelling building, the connection charge shall be $220 per dwelling unit from and after ~~~~~~~~~~ .Permits shall be required for all such connectioni but will be issued without charge prior to for such existing family dwelling ~~~~~~~~~~ buildings. B-2 District 2 Agenda Item 114 (3) Connection Ch~~ge for New Construction and Existing Strfictures, Other Than Family Dwelling Buildings. For all other new construction, including but not limited to commercial and industrial buildings, hotels and mctcl·:: and pt:.tlic ~uild:_ngs, tl-.,.e connection charge shall be $4S per ·1000 square feet, or any portion thereof, of floor area contained within such construction, provided that the minimum connection charge for such new construction shall be $220 .. The permit charges for existin~ structures, other than family dwelling buildings, shall become effective ~~~~~~~~~-and connection charges for such '• structures issued prior to ~~~~~~~~~ shall be without charge. (4) Connection Charge for Replacement Buildings. For new construction replacing former buildings, the connection charge shall be calculated on the same basis as provided in Paragraphs (1) and (3) hereinabove. If such replacement construction is commenced within two years after demolition or destruction of the former building, a credit against such charge shall be allowed and shall be the equivalent connection charge for the building being demolished or destroyed, calculated on the basis of current charges for new construction. In no case shall sue~ credit exceed the connection charge. (5) Connection Charges for Additions to or Altera- tions of Existing Buildings. In the case of structures where further new construction or alteration is made to · increase the occupancy of family dwelling buildings or the area of buildings to be used for other than family B-3 District 2 Agenda Item #Lt d~elling buildings, the connection charge shall be $220 for each dwelling unit added or created and in the case of new construction other than family dwelling buildings, it shall be $45 per 1000 square feet of adctitlonal floor· a~ea co~tained within such new struction, provided that the minimum connection charge for such construction shall be $220 .. When there are .additions to or alterations of structures other than family dwelling buildings that fall within the minimum square footage charge of $220·, a credit equal to the unused area shall be allowed. Such credit shall be available for a period of five years fron the date of •. initial connection charge. . . ( 6) When Charge is to be Paid.. Payment of c onnec- tion charges shall be required at the time of issuance of the building permit for all construction within the District, excepting in the case of a building legally exempt from the requirement of obtaining a building permit. The payment of the sewer connection charge for such buildings will be required at the time of and prior to the issuing of a plumbing connect.~ )n permit for any construction within the territorial limits of the _District. (7) Schedule of Charges. A schedule of charges specified herein will be on file in the office of the Secretary of the District and in the Building Department of each city.within the District. (8) ~iennial Review of Charges. At the end of two years from the effective date of this ordinance, and every two years thereafter, the Board of Directors shall review the charges established by this articl~ and if i~ its judgment such charges require modification, B-4 District 2 an amendment to thi~ ordinance will be adopted establishing r.: ttch rn;xli fica ti on. ARTICLE 3 Section (b) of Article 6 of Ordinance No.· 202· is amended by adding thereto Section (3) to read as follows: (3) When an excess capacity connection charge is payable by a user, as hereinabove provided, a · credit equal to the connection charge paid by the user, if any, shall be allowed against such excess capacity connection charge. ARTICLE 4 Except as herein amended, Ordinance No.·· 202· is ratified. and reafflrmed. Th~ Chairman of the Board of Directors shall slgn this Ordinance and the Secretary of the Districts shall attest thereto and certify to the passage of this Ordinance, and shall cause the same to be published once in the , a daily ~~~~~~~~~~~~~~~~~~ newspaper of general circulation, printed, published, and circulated in the District, within fifteen (15) days after the date of passage of this Ordinance by said Board of Directors and saij Ordinance ·shall take effect (to be determjned by the Board) PASSED AND ADOPTED by two-thirds of the entire Board of Directors of County Sanitation District No. 2 of Orange County, California, at a regular meeting held on the day of ----- ATTEST: Secretary, Board of Directors of County Sanitation District Chairman, Board of Directors of County Sanitation District No. 2 of Orange County, California No. 2 of Orange .County, California Agenda Item #4 B-5 District ?. ~ -SUMMARY OF 'l'INDINGS AMB RECOMMEWDATIQW:;.. ___..>; t}v . __ fl) To meet its existing and and anticipated future needs, District No. 2 initiated a five year sewerage improvement program which is estimated to cost more than $19 million. In conjunction with six other Orange County sanitation districts, the District is in the process of upgra_ding jointly owned sewage treatment works to meet State water quality control standards. The estimated cost of upgrading jointly owned primary treatment facilities is approximately $21. 2 million. The consulting engineers estimate the cost of activated sludge secondary treatment which eventu- ally will be required by Federal and State standards at approximately $100.8 million. '.~ 2. 'On the basis of the consulting engineers' cost estimates and construction schedules, the Director of Finance has projected funding needs of District No. 2 to implemen~ its program; meet its share of estimated capital costs of the proposed joint treatment works improvement program; provide for the District's share of pro- jected operations and maintenance costs; ana debt service costs on District bonds. Projected cash flow deficits range from ·approximately $1. 73 million in 1973/74 to $7. 62 million in 1975/76 dependent upon the level of secondary treatment required to meet Federal and State standards. 3 •. In the absence of new substantial sources of revenue, general obligation bond financing is the most practical and feasible financing alternative available to District No. 2 to implement its improvement program as scheduled . . 4) Recent development trends within the area served by the District have indicated the following: a. A trend toward increased higher density residential types o~: development in the District. b. The potential property tax base provided by single family unit land uses tends to be significantly greater than the potential property tax base provided by a multiple family unit. c. Engineering data indicate average daily flows per dwelling unit in single family residential land uses average about 385 gallons per unit. In h~.gh density residential land uses, flows averaged about 256 gallons per day per unit, or approximately two-thirds that oi lower density single family land uses. d. Within cities served by Disfrict No. 2 there are significant differences in present users of the District's sewerage facili- ties. Median value of owner occupied housing units ranges from $23 ,900 to $32, 300. Population per owner occupied housing units ranges from 3. 5 to 4. 0. e. Land values within the District have increased significantly in recent years. Land suitabl~ for low density residential devel- opment has increased from approximately $10, 000 to $12, 000 per acre in 1960 to current levels of $28, 000 to $30, 000. Land suitable for high density residential development is now valued at approxima- tely $50, 000 per acre. Land suitable for commercial development is now valued at approximately $100, 000 per acre. f. The District's property tax base of $1. 085 billion consists of land having an assessed valuation of $421 million (39 percent of total tax base) and improvements on land which is owned and occupied by present property owners having an assessed valuation o~ $664 million (61 percent of total tax base). 5. Demands ·for sewerage services are created by two broad classifications: (1) present users, and (2) potential users, (owners of improved or unimproved land not connected to the system but adjacent to it). A system of assessing and recovering the costs of these benefits must consider the followin9: a. Equity among present users. b. Equity among potential users. c. Equity between present and potential users. The distribution of costs in relation to complete equity in all cases is highly un- likely. What must be attempted is the achievement of optimum equity in relation to the degree of benefits received by broad categories of present users and poten- tial users within the constraints pose.:i by statutory provisions and practical ad- ministrative procedures. b . 6. On the basis of Cliff analyses, evaluations, and cons id era tion to optimize equity among us1rs and potential users of the District's sewerage system, it is ~ recommendal:1srML-that the governing Soard ef Di!'l:fiet Wg, 2 consider the use of a sewer connection fee as a new source of revenue. The purpose of. the con- ne·ction fee would be to recover costs of providing facilities in the neat;-::Q.iture whicl\ will have sufficient built-in capacity to serve future users. ~la'is'o recom- menctlhat the connection fee be made applicable to connections made to a District owned facility or to any local collector sewer which discharges into the District's sewerage system. --,J . . 7. As the basis fa formulating connection ch'arges, ;.,1 sugg0J9!1 costs of pro- viding trunk sewer and sewage trea~ent-disposal capacityr'~5time.£.e lhe unit costs of providing such facilities ~approximately $557 ,500 per million gallons. · 8. As the basis for computing connection charge fees, 4 ~commend that the 9:07v'CffiiR.CJ ~ard of Dis1iriot ~Je a Q consider using average anticipated sewage flows from residential land uses which have served as the basis to design master plan trunk sewer facilities in District No. 2 9. Based on the estimated capital cost of providing sewerage facilities, pro- jected flows from residential land uses, and current land use developments within the District, it is recommended that consideration be given to the estab- lishment of a residential unit connection charge of $220. 10. Commercial and industrial uses were considered in the same manner as resi- dential uses. It is anticipated these uses will provide an average flow of 3, 555 gallons per day per acre. At a unit capital cost of $55. 75 for providing 100 gallons of sewerage capacity, the charge would be approximately $2, 000 per acre. On a square footage basis, the capital cost for sewerage facilities would be approximately $45 per 1, 000 square feet of the facility. This rate is sug- gested as a general guide in recognition of the wide variation in types of indus- trial and commercial uses. It is suggested 'the charge for major types ·of indus- tria 1 and commercial facilities be coordinated with the ad minis tr.a ti on of the excess capacity connection fees of the Districts' Uniform Industrial Use Ordin- ance, on the basis of a close study of the capac~ty requirements, type of dis- charge, number of employees, and other related factors. 11. Annual revenue from connection charges under rates suggested in this study could provide as much as $1. 3 million on the basis of near-term develop- ment patterns anticipated in the District. 12. Based on the estimated revenue which may be derived annually from the suggested connection fees, the District could nearly meet its minimum cash deficit 0($1. 73 million in 1973/74, assuming Federal and State standards will necessitate only 46 mgd of secondar r treatment capacity, equivalent to activated sludge, for all Districts' flows. 13. Should full secondary treatment equivalent to activated sludge be required by Federal and State standards, anticipated connection fee revenue would only partly offset the estimated maximum cash flow deficit of $7. 62 million anti- c~pated in 19 75/76. 14. In view of the uncertainty of treatment level requirements and revenue real- ized from connection fees, it is recommended that consideration of the possible use of general obligation bond financing be deferred until additional information is made available relative to treatment level requirements. 15. The re~ommended level of connection charges for District No .. 2 is approxi- mately 12 percent lower than the level of charges recently adopted by Dis- trict No. 3. This differential appears to result from the differences in topo- graphy of the Districts, their respective needs for pumping stations and force mains, and miles of sewer mains contained in each District's trunk sewer system. . . . 16. District No. 2 master plan facilities are designed to serve areas presently outside the District's boundar.ie s. If a connection fee policy is adopted by the Board, it is recommended that the rationale for computation of annexation fees be revised. A suggested rationale is to maintain the existing charge at its present level and escalate it annually. The suggested amount of annual es- calation in the annexation fee wpuld be equivalent to the estimated property taxes paid to the District by the owner of an acre of raw land. . -. l.-- STATE MENT /fO ORANGE COUNT SAN I TAT I ON DIS I CT NO . 2 --._____ '-" \_ CONCERN I NG ES '-- THE CI TY OF BR EA HAS REV IEWED THIS SUBJECT AND THE SUPP ORTING FINA NC IAL CONSULTANT 'S REPOR T WITH MR . HARPER AND HIS STAFF . WE FEEL THAT THE FOLLrnl/ING REC OMMENDA T IONS SHOU LD BE ACCO MPLISHED, BASED UP ON THE INFORMAT ION RECEIVED FROM THE REPORT AND FROM THE DISTRICT STAFF , AND BA SED UPON THE FACT THAT BOTH THE PROPOSED ORDINANCE AND THE EXISTING FEE STRUCTURE WI LL BE RE QUIRED BY THE FED ERAL GOVERNMEN T TO BE SUPERS ED ED SOME T IME IN OCTOBER, 1973. THl S WlL L NEED TO BE DONE IN ORDER TO MEET THE FEDERAL REQU IREMENTS OF A USER'S FEE SC HE DULE . THEREF OR E, AFTER JO INT STUDY AND DE LI BERA T ION OF ALL TH E FACTS PRESEN TED IN THE PROPOSED ORDIN ANCE , WE WOULD RECOMMEND THAT TH IS BOARD TAKE TH E FOL LOltl I NG ACT I ON : 1. THA T WE GO ON RECORD AS NOT SUPPORT I NG THE ADOPT I ON OF THE SUG GES TED FE E SCHEDU LE AT THIS TI ME, S INCE MY INF ORMATIO N I ND I CA TE S THAT OUR FEES \•II LL HAVE TO BE MODI Fl ED IN THE NEAR FUTURE ANY WAY . IT SHOU LD ALSO BE NOTED TH AT THE F INANCIAL CONSULTANT 'S REPORT CONTEMPLA TES A TAX RED UCT ION AS A RESULT OF IMPLEM ENTING THE RE COMM EN DED FEE STRUCTU RE. 2. I WOU LD FURTHER RECOMMEND THAT WE GO ON RECORD AS FAVO RING THE CON T I NUA NCE OF OUR PRES ENT TAX RATE WHiCH WI LL E l~A 8 LE US TO CONS IDER A REDUCED FEE STRUCTURE . THES E RECOMM ENDA TI ONS WILL OBVIOUS LY BE INF LUE NCED BY OUR MEETINGS WlTH THE FEDERAL GOVERNMEN T: HOW EVE R, i N VIEW OF THE SE SAM E MEET INGS, WE FEEL AL L TH E MORE. STRONGLY THA T TH IS RECOMMENDED APPROACH IS THE MOS T APPROPRIAT E AND CAUTI OUS METHOD OF PROCEDURE TO FOL LOW. DISTRICT 2 -MAY 23, 1973 Chairman Nevil advised the Directors that the earliest possible effective date f or the ordinance was August 1st and that date had been typed in on the copy of Ordinance 203 in their folders . Also , regarding the one year abatement for payment of fees by existing residences, the date should be one year from the effective date of the ordinance , so asked the Directors to fill in the date of August 1, 1974, on pages B-2 and B-3. JWS t hen read list ~f all notices published or sent to interested parties and advised when and what material was sent out regarding considera- tion of Ordinance No . 203 . Item #5 was moved up on agenda before public hearing -Report of engineer on scheduling of Santa Ana River Interceptor, from Katella Avenue to LaPalma Avenue, Contract no. 2-14-2 (Just requested this change in agenda) Don Martinson reported that we must get approval of Santa Ana River Inte r.:.. cept or by State Water Resources Control Board . Chino Bas i n must also supply add~tional information and hope to get that material in this week . Also hope to get approval fr om State by the following week to go out for bids. Tentative sche-dule is to approve plans and specs ·on June 13th; ~ take bids on July 10th; award July 11th; start construction by September 1 0th; and complete construction by October 1974. Mr. Harper asked what the to tal cost estimate was and Mr . Mart i nson answered $5.2 million total cost estimate; construction cost estimate $4 .8 milli on; Districts' expense will be 5/8 of the $4 .8 million . Harper then asked if completed construction would tie into lower reach of interceptor and was answered , yes, that we were way ahead of schedule and would finish th~ fir s t . part of 1974. Nevil then introduced persons in attendance at public hearing . He then called a five-minute recess from 5 :30 -5 :35 in order to wa it a few minutes longer for the Dirc ~tor s that had not arrived yet . It em #3(a) -Public Hearing was then opened It em #3(b) -Ernest Bodnar , District's financial consultant , reviewed his report.. He stated that the Districts have sewerage improvement program t hat· will cost approximately $122 million; $19~ mi llion for trunk sewers(D.2) $5 million for its share of secondary and primary treatment i mprovement s that will have to be made . Cash flow d eficit could be incurred from $1.7 million to $7.6 million , depending on future requirements . Etc., etc. (See report) Item #3(d) Oral statements: Don Seitz , Anahe i m Hills -Stated that they had been provided the opportunity of meeting with the consultant prior to this public hearing and t ri ed to break his equity principle but failed to do so . Said Mr . Bodnar had done an excellent job preparing the report. He then stated that there was one point, mwever, that they would like to ask to be reconsidered . That was regarding the fact that the charge was coming from the rate of zero -to an amount that is very substantial. Added that in reviewing the rep ort and p. 2 looking at the forecast for five years, see that the 1973-74 deficit is $1.7 million. Said this deficit is only in the reserve fund and only for this one year period, so is not so much a question of providing financing as it is of providing -equity. He then stated he would like to request that the District ease into this type of thing over a three or four year period rather than as a lump sum .. fee. Royce Cahn Buildin Industry Assn. -Stated that food prices just went up in .one month but this ordinance would be going up 220%. Said he would like to extend the thought of Mr. Seitz a little further. Thought it would be more equitable if we would approach this on a graduated basis; p ·ossibly the first year cut this 50% or possibly 1/3. Then at the end of the year, make another financial analysis to see what would be a reasonable increase if it is still required to maintain equitability. Also stated that regarding the effective date of August 1, 1973, a builder could not put i .nto his financial package this substantial amount in that short time. He has got to have about four months to build this cost into his project package. Nevil advised that the date of August 1, 1973, was inserted as an abitrary date ~nd could be changed if the Directors so desired. Bob Main, Garden Grove San. Dist. -Asked how much of this revenue is being allocated toward increasing the quality of the treatment of the effluent? Mr. Bodnar answered that treatment plant improvements called for providing additional primary capacity at ~1.2 million. Also said we are talking about adding 196 mgd secondary treatment at ab~ut $101 million. Bodnar said that major part of projected treatment plant expenditure is for upgrading treatment. Main asked again how much of $220 fee is going to be for increased treatment? Bodnar said major portion of funding require- ments is for trunk sewer program. District 2's share in trunk sewer program is $19 million. Main then asked if Mr. Bodnar had stated that it is possible that some year we may be able to decrease taxes. Bodnar answered that was a possibility. Main said he didn't agree with new users paying for increased treatment for everybody and doesn't agree wi~h new users paying same taxes . as everybody. S_aid a few months ago $50 -.ras going to solve the problem and now need $250 and still may have to h ave bond issue. Said he didn't understand that. Mr. Bodnar stated that t1:2 problem was one of equity for present users, not just a problem of needing X amount of dollars. Walt Bressel, Garden Grove San. Dist. -Stated he had been following and opposing concept of this connection fee since $50 per unit charge was being considered. Said he was led to believe that that amount would wipe out projected deficit in five-year period and was a strong possibility of tax decrease. Felt engineers should be intelligent enough · to know what was r~quired themselves and shouldn't have to go to outside consultant. Said if he weren't associated with the Sanitation Districts, would strongly consider a taxpayer's suit on this. Said that the U. s: government is striving for a users fee which is not the same thing as a connection fee. Disagreed with tax figures used in Stone & Youngberg report. Also said in Garden Grove Sanitary District, they don't pay taxes until they annex. Here they have to pay taxes whether they annex or not. Money collected on improved property should have been to buy capacity in trunk. If capacity has to be increased, it is because past users have used it. p. 3 Gary Frye, William Lyon Co.· -Said he was not at all familiar with workings of Sanitation Districts but from what he had just heard, one of the key points being considered here is problem of equity and how to charge this equitably to the users. Thought it would be much more equitable to charge according to what charges are after contracts have been let. Said he thought there may be a better approach to determine what is· equitable. Opinion right now is that the growth is requiring the sewer, so it is equitable to charge new users. Thinks that increase in property values are contingent upon adequate facilities, and if you do not have growth you do not have increase in property values. Are perhaps overtaxing growth which provides possibility for increased property values. Are overtaxing the very source of growth and funds to the District for future improvements. With regard to projecting size and capacity, asked how long it was going to take for the District to require capacity that is not required now? Said we may be overcharging ourselves. Mr. Bodnar answered that the trunk sewer system is designed to accomodate District's projections to year 2000 and the trunk sewers are designed with those projections in mind. Bodnar also stated regarding cost figures, costs were developed by · _engineers and they took their estimates . Regarding time period for capacity, Don Martinson reported that trunk sewer system was not designed to accomo- date all of the areas that might annex. Other sev..erswill be needed in the long range future. Bressel then stated he wanted to put in a bid for revenue sharing funds because the CSDs constitute the sewering arm of the County. EPA is one of the highest listed for the revenue sharing program, and have agreed to make these available where more than one city is served. Finnell said that when the federal revenue sharing bill was passed, he discussed it with the Genera l Manager and the position the Districts should take. Largest concerrr was the fact that if we accept revenue sharing funds, we could not use that mon_ey against federal grants, which are 80% funds, so did not approach Board of Supervisors. In Garden Grove's situation, w·ould not be prohibitive for them to secure these funds. It was then moved and seconded to close the public hearing. (Closed at 6:19) Item #4 -Consideration of Ordinance No. 203 Finnell asked for a clarification of Article 2 (a)(3) regarding the last sentence and the words "permit charges ". Should be"connection charges". Nevil stated that this would be corrected. Should still apply for permit, but would not collect fees for one year. Clark said that when we are involved in changing fees from one structure to another, should understand problems i _n changing over. Was impressed with what Mr. Cahn said regarding their need for four months to build cost into their projects. Thought we should be realistic enough -' to understand where the costs are to be applied. Also thought that possibly the August date should be changed to October. Should discuss this before voting. · Fox then stated that he understood that we would be coming back in the immediate future and looking into a users -fee. Mr. Harper answered that was correct. p. 4 Culver stated that we have a very big unknown between $1.7 and $7 .6 million . In order to determine when or how this i s going to be established under Article 2 , Section A, it is to be hashed over at the end o f two y ears. Wondered if it could be reviewed at the end of one year . Nevil said that would be up to t he Board. Smith suggested 'the date be September. Root commented that we are going to start running into a deficit as this problem is coming up in the next year . As far as the two-year figure is concerned, said we are-trying to b uil d enough time into this so we can have a better feel about it. i,~ Shook sugge sted that the August 1, 1 9 73 date could be moved up two months but leave th e final date for prior existing r esidences the same. ~ Just moved that the e ffec tive date of the o rdi nance be set as Oc tober 1, 197 3 . Th e motion was seconded . Lawson Mea d advised that regarding the ~ ...J abatement of connection f ees , that date would have to be voted on also. . ~ Mr. Harper stated that we have to adopt a p ro gram by September or October ' to get grant s we have applied for. Chaput st a ted that he opposed the October 1st date (I think??) A ro ll call vote was taken on the effective date of· the ordinance as Octobe r 1, 1 9 73, and the motiorr passed. Winn then stated that he was opposed to the $220 amount and suggested that a fi gur e less than that be considered with annua l review to consider additional fi gures. · Stephenson said he thought we agreed that it to ok the $220 to fill the bill and if we cut it down, vha t figure sho uld we use. Root commented that we have had o rdinance under discusssion for a con- siderable period of time. Have paid for financial consultant to prepare information for us and work was well done . Don't see how we could pick another number or how we co uld refute his actions without having another complete st udy. Smith said he was in favor of o rd i nance . Started out about l~ years ago with $50 but we kept getting furt h er in t he hole. Can't raise our taxes and can't borrow money unless we pay it back the same year so is r eally important 1D adopt this o rdi nance. Culver asked Root wh at thft disadvantage _w9u l d be o f having an annual review. Root answered that it was felt that one year was not enough time to d~termine the complete effect of thi s a c t i vity since it was complet e ly new. ~ ~"-Nevil stated that ordinance would require · ~t-.ta.l review but could be reviewed sooner . Finnell said he agree·d with language on b:±a:r-:i.-Rtl-a-1 review but thought Cu l ver had brought up a good point that by 1974 should be in a good position to know requirements of .Dist r ict . Said f or that reason he would-be willing to support an annual review f or at le ast the first year. Lawson Mead said this could be changed by majority vote. Don Seitz asked if the deficit was going to continue afte r 1 973-74 , and JWS answered that it would depend upon the secondary treatment requirements and could be · a three -year de ficit. . . p. 5 .. Smith move d that the date August 1, 1974, be inserted on pages 2 and 3 with re gard to fee s for existing conn ections. Root seconded the motion. Roll call vote was taken Cl1d mot ion carried. Fox read statement from Ciyy of Brea . (See attached) Finnell asked whether a user charge wouldn't be required by Septembe r 1973. Mr Harper answered that p rior to receiveing approval for grants we wi ll be r equired to have program to assure state and federal p e ople that we have equity in the use of the sewer system . Smith moved for adoption of Ordinance No . 203, amending Uni f orm Connection and Use Ordi nance No . 202 . Root seconded motion . Nevil restated the dates that had been approved and inserted in ordinance. Ro l l call vote was taken and the motion carried . Winn stated tt;at he wanted it recorded that he was not opposed to the connection charge but felt the $i20 figure• was excessive at this time. 3/1 4/73 ALL DISTRICTS Authori z ing change of regular May meeting date to May 2nd to May 2nd . ALL DISTRICTS Approving Chan g e Order No. 2 to plans and specifications for Job No . I -B-3 Mo v ed, seconded , and du l y carried: That the regular May , 1973 , meeting d ate of the Joint Boards of Directors be changed from May 9th Moved , seconded , and du l y carri ed: That Change Order No. 2 to the p l an s and specifications for I nfluent Metering and Diversion Structure at Plant No. 1, Job No . I-8-3 , authorizing an addition of $11,342.00 to th~ contract with E . T . I . and Ko r dick, be approved . Copy of th i s change order is attached hereto and made a part of t h ese minutes. ALL DISTRICTS Approving Chan g e Order No. 3 to p l ans and specifications for Job No. I -B-3 Moved , secon~ed, and duly carried: Th at Change Ord e r No. 3 to the plans and specifications for I nfl uent Metering and Diversion Structure at Plant No. 1, Job No. I -8 -3 , authorizing an additio n of $16,136 .00 to the contract with E . T. I . and Kordick , be approved . Copy of this change order i s attached hereto and made a part of these minutes . ALL DISTRICTS Appro v ing Ch ange Order No . 6 t o p l a n s and sp e cifi c a tio n s f o r Job No . J-7-2 Moved , seconded , and duly carried: Tha·t Change Order No. 6 to the plans and specifications for Administration-En g ineering Building Addition, Job No. J-7-2, g ranting an extension of time of 20 cale ndar days to the con tract with B. H. Miller Construction Co mpany, be approved . Co p y of this cha nge ·order is attached her e to and mad e a part of these minutes . ALL DISTRICTS Moved, seconded , and duly carried : Acceptin g Job No . J -7-2 as complete That the Boards of Directors adopt Resolution No. 73-19 , accepting Administration-Engineering Building Addition, Job No . J -7-2, as complete and authorizing executi9n of a Notice of Completion . Certifie d copy of this resolution is attache d hereto and mad e a part of these minutes. ALL DISTRICTS Report o f Sp ec ial Commi ttee on Di r ec t ors ' F e e s for Concu r rent Mee tings Director Just, Cha i rman of the Sp e cial Committ ee o n Directors' Fees for Concurrent Me e t i n g s, reviewe d the Committ ee 's report . The Committ ee. p r e s e nted five alternatives for the Directors ' consideration, a s follow s : 1 . Maintain the Directors' compensation at th e present leve l a ~ established by resolution of the individual Districts in 1967 and 1968 . 2 . Am e nd the f ee s che dul e s o tha t th ose Dire ctors r e prese n tin g mo r e tha n one Di s trict a t a Jo i nt Meeting wo ul d o n l y r e c e ive com p e n sa tion e qua l t o tha t of a Di r e ctor r e prese n t ing a sing l e Di st ric t . (Th e Co mmi ttee 's r e p o r t cont a ine d a r eso lution d r a f t which would imple me nt thi s a l terna t i v e .) -6- COUNTY SANITATION DISTRICT NO. 2 MINUTES OF ADJOURNED REGULAR MEETING May 23 2 1973 -5:00 p.m. 10844 Ellis Avenue Fountain Valley, California Pursuant to adjournment of the regular meeting held May 9, 1973, the Board of Directors of County Sanitation District No. 2, of Orange County, California, met in an adjourned regular meeting at the above hour and date, in the District offices. The Chairman called the meeting to order at 5:15 p.m. The roll was called, and the Secretary reported a quorum present. DIRECTORS PRESENT: DIRECTORS ABSENT: STAFF MEMBERS PRESENT: OTHERS PRESEN'r: Robert Nevil (Chairman), Ralph Clark, Norman Culver, Dale Chaput, Robert Finnell, Donald Fox, Edward Just, Jerry Patterson, Robert Root, Don Smith, Mark Stephenson, and ·Donald Winn None Fred A. Harper, General Manager,· J. Wayne Sylvester, Secretary, Ray Lewis, Robert Webber, Jim Benzie,. and Rita Brown Lawson Mead, Ernest Bodnar, Royce Cahn, Milo Keith, Jack Kenney, Donald Martinson, Jim Barisic, Walt Bressel, Fred Clodt, Gary Frye, Jack Guise, E. V. Kadow, Kerry Lawler, Bob Main, Don Seitz, Ralph Shook, and D. E. Wilkins * * * * * * * * * * * * Report 6f Enginee~·re Santa Ana River Inter- ceptor, Contract 2-14-2 ~r. Donald ~artinson of Lowry & Associates, District's consulting engineer, reviewed the scheduling of the Santa Ana River Interceptor from Katella Ave~ue to La Palma Avenue, Cbntract No. 2-14~2. The project is being reviewed by the State Water Resources Control Board and if approval is forthcoming, the following tentative schedule has been established: June 13, 1973 July 10, 1973 July 11, 1973 __ September 10, 1973 October, 1974 Consideration of Plans and Specifications by the Board of Directors Receive bids Award contract Commence construction Complete project #2 5/23/73 Mr. Martinson stated that when the $5.2 million project is tied into Contract No. 2-14-1 in October of 1974, the Santa Ana River Interceptor· will then be complete and in service from Treatment Plant No. 1 to La Palma Avenue. ~ Recess Reconvene Public Hearing re proposed Sewer Connection Ordinance No. 203 was declared open by the The Chairman declared a five minute recess at 5:30 p.m. The Board reconvened at 5:35 p.m. Open Public Hearing -The public hearing on proposed Sewer Connection Ordinance No. 203, amending Uniform Connection and Use Ordinance No. 202, Chairman. Discussion re effective date of proposed Ordinance -Chairman Nevil reported to the Directors that August 1, 1973, had been suggested as an effective date in the event proposed Ordinance No. 203 is adopted and advised that the matter would be further discussed under the item for consideration of Ordinance No. 203. Statement re notices of public ·hearing -The Secretary reported that the following notices had been mailed to all cities, sanitary districts, and permittees within the Dist~icit, the County of Orange, those interested parties from whom communi- cations had been received with regard to the proposed connection charges, and District Directors and Alternates: February 23, 1973 April 17, 1973 April 27, 1973 May 8, 1973 May 17, 1973 Notice ·of further consideration of Ordinance No. 203 Notice of public hearing re Sewer Connection Ordinance No. 203, with draft of proposed ordinance Copies of the Summary and Conclusions of the report "Financing Major Sewerage Improvements -Orange County Sanitation District No. 2" prepared by Stone & ·Youngberg Second notice of public hearing re Sewer Connection Ordinance No. 203, with copies of proposed ordinance Public Notice of hearing was published in Santa Ana Register Report of financing consultant -Mr. Ernest Bodnar of Stone & Youngberg, Municipal Financing Consultants, Inc., reviewed the report prepared by his firm on Financing Major Sewerage · Improvements f )r County Sanitation District No. 2 and summar- ized the findL1gs and recommendations as follows: -2- #2 5/23/73 1. To meet its existing and anticipated future needs, District No. 2 initiated a five-year sewerage improve- ment program whi~h is estimated to cost more than $19 million. In conjunction with six other Orange County sanitation districts, the District is in the process.of upgrading jointly-owned sewage treatment works to meet State water quality control standards. The estimated cost of upgrading jointly-owned primary treatment facilities is approximately $21.2 million. The consulting engiheers estimate the cost of activated sludge secondary treatment which eventually will be required by Federal and State standards at approximately $100.8 million. 2. On the basis of the consulting engineers' cost estimates and construction schedules, the Director of Finance has projected funding needs of District No. 2 to implement its program; meet its share of estimated capital costs of the proposed joint treatment works improvement program; provide for the District's share of projected operations and maintenance costs; and debt service costs on District bonds. Projected cash flow deficits range from approximately $1.73 million in 1973/74 to $7.62 million in 1975/76 dependent ·upon the level of secondary treatment required to meet Federal and State standards. 3. In the absence of new ~ubstantial sources of revenue, ·general obligation bond financing is the most ·practical and feasible financing alternative available to District No. 2 to implement its improvement program as scheduled. 4~ Recent development trends within the area served by the District have indicated the following: a. A trend toward increased higher density residential types of de~alopment in th~ District. b. The potential property tax base provided by single family unit land uses tends to be significantly greater than the potential property tax base provided by a multiple family unit. c. Engineering data indicate average daily flows per dwelling unit in single family residential land uses average about 385 gallons. per unit. In high density re~idential land uses, flows averag~d about 256 gallons per day per unit, or approximately two-thirds that of lower density single family land uses. d. Within cities served by District No. 2 there are significant differences in present users of the District's sewerage facilities. Median value of owner-occupied housing units ranges from $23,900 to $32,300. Population per owner- occupied housing units ranges from 3.5 to 4.0. -3- #2 5/23/73 e. Land values within the District have increased significantly in recent years. Land suitable for low density residential development has increased from approximately $10,000 to $12,000 per acre . in 1960 to current levels of $28,ooo to $30,000: Land suitable for high density residential develop- ment is now valued at approximately $50,000 per acre. Land suitable for commercial development is n6~ valued at approximately ~100,000 per acre. f. The District's property tax base of $1.085 billion consists of land having an assessed valuation of $421 million (39 percent of total tax base) and improvements on land which is owned and occupied by present property owners having an assessed valua~ion of $664 million (61 percent of total tax base). 5. Demands for sewerage services are created by two broad classifications: (1) present users, and (2) potential users, (owners of improved or unimproved land not connected to the system but adjacent to it). A system of assessing and recovering the costs of these benefits must consider the following: a. Equity among present users. b. Equity a~ong potenti~l users. c. Equity between present and potential ~se~s .. The distribution of costs in relation to complete equity: in all cases is highly unlikely. What must be attempted is the achievement of optimum equity in relation to the degree of benefits received by broad categories of present users and potential us~~s within the constraints posed by statutory provisions and practical administrative procedures. 6. On the basis of the analyses, evaluations, and consideration to optimize equity among users and potential users of the District's sewerage system, it is recommended that the governing Board consider the use of a sewer connection fee as a new source of revenue. The purpose of the connection fee would be to recover costs of providing facilities in the near future which will have sufficient built-in capacity to serve future users. It is also recommended that the connection fee be made applicable to connections made to a District owned facility or to any local collector sewer which discharges into the District's sew .. erage system. 7. As the basis for formulating connection charges, unit costs of providing trunk sewer and sewage treatment- disposal capacity are suggested. The unit cost of providing such facilities is approximately $557,500 per million gallons. 8. As the basi3 for computing connection charge fees, it is recommeneed that the Board consider using average anticipated sewage flows from residential land uses which have served as the basis to design master plan trunk sewer facilities in District No. 2. -4- #2 5/23/73 9. Based on the estimated capital cost of providing sewerage facilities, projected flows from residential land uses, and current land use developments within the District, it is recommertded that consideration be given to the establishment of a residential unit connection charge of $220. 10. Commercial and industrial uses were considered in the same manner as residential uses. It is anticipated these uses will p~ovide an average flow of 3,555 gallons per day per acre. At a unit capital cost of $55.75 for providing 100 gallons of sewerage capacity, the charge would be approximately $2,000 per acre. On a square footage basis, the capital cost for sewerage facilities would be approximately $45 per 1,000 square feet of the facility. This rate is suggested as a general guide in recognition of the wide variation in types of industrial and commercial uses. It is suggested the charge for major types of industrial and commercial facilities be coordinated with the administration of the excess capacity connection fees of the Districts' Uniform Industrial Use Ordinance, on the basis of a close study of the capacity requirements, type of discharge, number ~f employees, and other related factors. 11. Annual revenue from connection charges under rates suggested in this study could provide as much as $1.3 million on the basis of near-term development patterns anticipated in the-District. 12. Based on the estimated revenue which may be derived annually from the suggested connection fees, the District could nearly meet its minimum cash deficit of $1.73 million in 1973/74, assuming Federal and State standards will necessitate only 46 mgd of secondary treatment capacity, equivalent to activated sludge, for·all Districts' flows. 13. Should full secondary treatment equivalent to activated sludge be required by Federal and State standards, antici- pated connection fee revenue would only partly offset the estimated maximum cash flow deficit of $7 .62 million anticipated in 1975/76. 14. In view of the uncertainty of treatment level requirements and revenue realized from connection fees, it is recommended that consideration of the possible use of general obligation bond financing be deferred until . additional information is made available relative to treatment level requirements. 15. The recommended level of connection charges for District No. 2 is approximately 12 percent lower than the level of charges recently adop~ed by District No. 3 •. This differential appears to result from the differences in topography of the Districts, their respective needs for pumping stations and force mains, and miles of sewer mains contained in each District's trunk sewer system. 16. District No. 2 master· plan facilities are designed to serve areas presently outside the District's boundaries. If a connection fee policy is adopted by the Board, it is recommended that the rationale for computation of annexation fees be revised. A suggested rationale is to maintain the existing charge at its present level and escalate it annually. The suggested amount of annual es- calation in the annexation fee would be equivalent to the estimated property taxes paid to th~ District by the owner of an acre of raw land. -5- #2 5/23/73 I Written communications -The Secreta' repqrted that.no written communications in connection with proposed Ordinance No. 203 had been received. Oral statements -The Chair recognized Mr. Donald Seitz representing Anaheim Hills, Inc., Mr. Royce Cahn representing the Building Industry Association, Mr. Gary Frye representing the William Lyon Company, and Mr. Robert Main and Mr. Walt Bressel representing the Garden Grove Sanitary District, each '-" of whom addressed the Board in connection with the proposed ordinance and/or asked questions of the financing consultant concerning the District's funding requirements. In response to a question regarding the District's eligibility for federal revenue sharing funds, Director Finnell, Chairman of the Joint Administrative Organization, reported that when revenue sharing funds were first announced, the Joint Districts were advised by the Environmental Protection Agency that if they were receiving federal construction grant funds, revenue sharing funds could not be used to offset the local share of costs. Close public hearing -It was moved, seconded and duly carried that the public hearing on proposed Sewer Connection Ordinance No. 203 be closed. The Chairman then declared the hearing closed at 6:19 p.m., May 23, 1973. Consideration of Proposed Sewer Connection Ordinance No. 203 The Board entered into a lengthy discussion concerning proposed Sewer Connection Ordinance No. 203, during which the comments of Directors and members of the public who had addressed the Board concerning the ordinance were considered at great length. The following actions were then taken: Clarification of Article 2(A)(3) -Following a brief dis- cussion regarding Article 2, Section A, Subsection 3, the Chairman directed that the word "permitir be striken from the last sentence and replaced by the word "connection". Establishing effective date of ordinance -Moved, seconded and duly carried by roll call vote: That October 1, 1973, be established as the effective date for proposed Sewer Connection Ordinance No. 203, and that said date be so incorporated into the proposed ordinance. Establishing waiver period re fees for developed properties - Moved, seconded and duly carried by roll call vote: . That connection fees for property which is currently developed but not discharging to a sewer be waived until August 1, 1974, and that saj_d date be so incorporated into the proposed ordinance. Adoption of Ordinance No. 203 In response to a question posed by Directors, the General Manager reiterated that he anticipated the necessity of major changes to the District's Uniform Connection and Use Ordinance in the near future as a result of the new Federal Water Q11ality Control Act of 1972, which requires that sewering agencies adoot a system of charges to ensure that each user pays his equitable share of the cost·of operating the system. -6- \ -.... #2 5/23/73 Director Fox of the City of Brea then read the following statement concerning fees into the record: "The City of Brea has reviewed this subject and the . supporting financial consultant's report with Mr. Harper and his staff. We feel that the following recommendations should be accomplished, based upon the information received from the report and from the District staff, and based upon the fact that both the proposed ordinance and the existing fee structure will be required by the Federal Government to be superseded some time in October, 1973. This will need to be done in order to meet the Federal requirements of a user's fee schedule. Therefore, after joint study and deliberation of all the facts presented in the proposed ordinance, we would recommend that this Board take the following action: 1. That we go on record as not supporting the adoption of the suggested fee schedule at this time, since my ·information indicates that our fees will have to be modified in the near future anyway. It should also be noted that the financial consultant's report contemplates a ta~ reduction as a result of implementing the recom- mended fee structure. 2. I would further recommend that we go on record as favoring the continuance of our present tax rate which will enable us to consider ~ reduced fee structure. These recommendations will obviously be influenced by our meetings with the Federal Government: However, in view of these same meetings, we feel all the more strongly that this recommended approach is the most appropriate and cautious method of procedure to follow." It was then moved and seconded that Ordinance No. 203, an ordinance amending Uniform Connection and Use Ordinance No. 202, be adopted. Director Winn requested that it be made a matter of record that he was not opposed to the philosophy of a connection charge, but that he did not agree with the fee schedule incorporated into the ordinance. The ordinance then passed by the following roll call vote: AYES: NOES: ABSENT: Adjournment Directors Nevil, Clark, Chaput, Finnell, Fox, Just, Patterson, Root, Smith and Stephenson Directors Culver and Winn None It was moved, seconded and duly carried: That this meeting of the Board of Directors of County Sanitation District No. 2 be adjourned. The Chairman then declared the meeting so adjourned at 6:52 p.m., May 23, 1973. -7-