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Consent-General Government # 9.
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| Board of Supervisors |
County Administrator |
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| Subject |
| Approve North Davis Meadows County Service Area initiation of Proposition 218 proceedings for water fee changes to support Water System Consolidation Project. (No general fund impact) (Blacklock/Gabor) |
| Recommended Action |
- Authorize staff to initiate proceedings to consider proposed changes in the water fee for the North Davis Meadows County Service Area (CSA) to support the Water System Consolidation Project;
- Direct staff to mail notice of repeal of the May 31, 2016 water fee increase and notice of the public hearing to consider a proposed fee increase for water service to residents within the North Davis Meadows CSA at least 45 days before the public hearing, including notification of the opportunity to protest the proposed fee changes;
- Direct the Clerk of the Board of Supervisors to publish notice pursuant to Section 6066 of the Government Code;
- Direct staff to set the time and date of the public hearing to consider the proposed fee change and to receive and consider all public comment, including but not limited to, any protests against the proposed fee changes; and
- Direct staff to prepare a resolution adopting and levying the modified water fee for the North Davis Meadows CSA in the event the increase is not successfully protested.
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| Strategic Plan Goal(s) |
Operational Excellence
Thriving Residents
Sustainable Environment |
| Reason for Recommended Action/Background |
The recommended actions are to initiate the process for the North Davis Meadows County Service Area ("CSA") to adopt a water fee change to cover the cost of providing potable (drinking) water service in the CSA. Future water service to the community will be adversely impacted unless a fee increase occurs. Any change in the water fee is subject to Proposition 218 which requires the CSA to hold a public protest hearing prior to adopting the proposed fee increase. If more than 50% of the affected property owners submit written protests against the proposed fee increase, the increase cannot be adopted.
Background
Since 2010, the CSA has been working toward a permanent solution for mitigation of water quality concerns in the community, most notably nitrate, hexavalent chromium, aluminum and iron in excess of maximum contaminant levels. After assessing a variety of options for providing a potable water supply that meets all drinking water standards, the County and CSA concluded consolidating with the City of Davis public water system was the most reliable and cost-effective method to comply with California drinking water regulations and to ensure the health and safety of the residents of North Davis Meadows. On February 28, 2016, and again on November 8, 2017 following a change in the project, the Davis City Council directed their staff to provide a water service "will serve" letter to Yolo County for the North Davis Meadows CSA.
On May 31, 2016, a Proposition 218 hearing was held to increase the North Davis Meadows CSA water fee in an amount necessary to repay an anticipated State Revolving Fund (SRF) 20 year planning loan to cover the cost of design of the water consolidation project. The increased water fee was first collected in 2016-17 and is again being collected in 2017-18. While design commenced in December of 2016, it was discovered SRF planning loans must be repaid within 5 years. On behalf of the North Davis Meadows CSA, staff changed course and is in the process of applying for a combined SRF planning and construction loan which can be repaid over 30 years. In the meantime, staff obtained an interim loan from the County for the design work which was already underway.
On January 16, 2017, West Yost Associates delivered draft Plans, Specifications & Estimates for the project that estimate construction costs and the costs to decommission/demolish the existing wells at $5,486,000. Design of the project, the fee study, City connection fees, construction management and project management costs bring the entire project estimate to $8,349,301. Beyond these anticipated costs, the State requires x1.1 debt coverage (collection of 110% of the project cost in the event payments are missed) for their loan. Conservatively, interest for the SFR loan plus debt coverage is estimated to be around 2%.
Final project cost estimates and property owner rates will be outlined in the public hearing notice. Rates will recognize and credit fees collected to date for the design. Should the SRF loan or construction costs vary, rates will be adjusted accordingly with subsequent Proposition 218 proceedings.
The public notice will be mailed to residents by the end of January 2018. On February 1, a CSA Advisory Committee meeting will be held at 7:00 p.m at the Davis Municipal Golf Course Clubhouse to provide the community information about the project and to answer questions from residents.
This project will result in water service from the City of Davis to 94 homes, a vacant lot, fire hydrants and common use areas in the North Davis Meadow CSA. The project will also include a connection to the Davis Municipal Golf Course Clubhouse which will be paid for by the City of Davis. |
| Collaborations (including Board advisory groups and external partner agencies) |
| North Davis Meadows CSA Advisory Committee, City of Davis, California Water Resources Control Board, Financial Services, County Counsel. |
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| Fiscal Impact |
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| Source of Funds for this Expenditure |
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