SR-9-A (101)
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PWM:CP:JM:BR:PARRPT3. WPD
CouncIl Meeting: July 25 t 1995
Santa MOnIca, CalIforma
JUl 2 5 1995
TO:
FROM:
SUBJECT:
Mayor and CIty CouncIl
CIty Staff
RecommendatiOn to Approve the Stormwater Parcel Report Describmg Each
Parcel In the CIty and the Amount of each Parcel's Stormwater Management
User Fee for FY 1995-96.
INTRODUCTION
This report recommends that the City Council approve the Stormwater Parcel Report which
descnbes each parcel III the CIty and detaIls the amount of each parcel's Stormwater Management
User Fee. ThIS action IS taken pursuant to Cahfomla Health and Safety Code SectIon 5473.4,
The proposed fee IS necessary to maintam the eXIstIng hIgh level of stormwater management
programs and fund cnllcal enhancements such as the dry-weather flow treatment facihty and
Implementation of the recently approved Santa MOnIca Bay RestoratiOn Plan.
BACKGROUND
Urban Runoff contammated WIth petroleum products, pestlcIdes, chemIcals, heavy metals, ammal
droppmgs and garbage poses a severe threat to the economic, recreational and bIOlogICal resources
of the CIty of Santa MOnIca and IS the largest source of pollution to the Santa Momca Bay. The
City has long been commItted to local and regIOnal actIons to Improve the condItIon of the Bay
and protect the health and safety of the mllhons of residents and viSItors who enjoy Santa
Monica's renowned beaches and ocean front each year.
WhIle the Los Angeles County PublIc Works Department mamtams and operates a SIgnificant
portIon of the storm dram system wlthm Santa MOnIca, the CIty IS responsible for the qualIty of
the runoff reachmg the dramage system (pursuant to the Federally mandated NPDES permIt) and
for the operatIon and mamtenance of 824 catch basms and 20 mIles of storm drams Smce roughly
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half of the runoff is estimated to ongmate from outside the City, both the County and City of Los
Angeles have actIvely particIpated m and contnbuted funds towards efforts to control storm water
runoff. These efforts mclude (1) the Plco-Kenter Extension -- ThIS tnpartite agreement between
the Los Angeles County, the City of Los Angeles and the CIty of Santa Monica which extends the
Pico-Kenter outfall and includes the development of a fuel-spIll detectIOn system spreads the
projects costs evenly between the three entitIes; (2) Ptco-Kenter!Pler Diversion -- In an agreement
between the CIty of Los Angeles and the CIty of Santa Momca to divert dry weather flows from
the Plco-Kenter and PIer storm drams to the Hypenon Sewage Treatment Plant, costs are split
50/50; and (3) Plco-Kenter/PIer Low Flow Treatment Plant -- The CIty IS m active negotlatlOns
WIth the CIty of Los Angeles, the County of Los Angeles and CalTrans to secure fundmg for a
plant to treat dry weather flows from the PICO- Kenter and Pier Storm Drams.
Stormwater management and pollutIOn preventIon activltles are expected to become sIgmficantly
more urgent over the next few years due to ImplementatIon of the Federally mandated 1995
NatIonal PollutIOn DIscharge ElImmatlon System (NPDES) permIt, the recently approved Santa
Monica Bay Restoration Plan and contmued enforcement and momtonng of the City's Urban
Runoff Pollution Prevention Ordmance. Some of the innovatIve projects whIch are m process
mclude:
· Urban runoff low-flow treatment facilIty
· Fuel spill detectlon system
· Enforcement of the Urban Runoff PollutIOn Ordmance
· An aggressive catch-baSIn cleamng program
· Used 011 RecyclIng
· Household Hazardous Waste Collection
· ExtenSIve pubhc educatIon and outreach efforts
· Storm Dram Master Plan
. IllICIt dIscharge preventIon
2
The proven effectIveness of these storm water management programs is eVIdenced by Improved
condItIons In the Bay Based on Heal the Bay's annual report card which grades storm dram out-
falls, the Pico-Kenter out-fall has improved from an F to Band C grades over the past four years
However, Without an adequate and rehable source of fundmg for these efforts the CIty of Santa
Monica will not be able to continue Its current program activities beyond FY 1995-96
On July 11, 1995, CIty CouncIl approved for mtroduction and first readmg an ordmance to
estabhsh a Stormwater Management User Fee as a fundIng source for storm water management
actIvities, mcludmg maintenance and penodlc upgrades and replacement to the storm dram
system, catch baSIn cleamng, publIc educatIon and outreach, pollutlOn control enforcement, and
other cost-effective programs that help reduce the volume and tOXICity of urban runoff pollutIon.
The second reading of thIS ordmance IS scheduled for July 25, 1995.
CURRENT FIJl\l))ING FOR STORM\V A TER PROGRAMS
These essential stormwater management actlvitIes have histoncally been financed by the
Wastewater Enterpnse Fund, which is supported by bimonthly servIce charges on the utilIty bIlls
of water customers In the CIty. It IS estImated that approximately $1.2 mIllion of Wastewater
fund revenues would be needed annually to cover the costs of storm water management actIvIties
over the next 4 years. Fundmg these storm water management costs through wastewater revenues
IS no longer recommended for the followmg reasons.
Equity -- Wastewater bills are based on a customer's water usage rather than amount of
runoff generated by a gIVen parcel of land, therefore the amount paId does not reflect the
level of use and the benefits receIVed from the storm water system by the property owner
Under thIS system, water customers are subsid1Z1ng the costs of storm water management
for large propertIes. For example, parcels With large lmpervlOus areas, such as the
Auport, are responSIble for a much more sigmficant portIon of storm runoff than IS
reflected by theIr proportionate water usage.
3
Reliahility of Revenue -- State and Federal regulations reqUlre that the CIty's wastewater
rates be stnctly tied to the operatIons and capItal costs for the sewer system only Because
of tius, the State Water Resources Control Board strongly dIscourages fundmg the Cay's
stormwater actIvIties from the wastewater rates. Also, wastewater fund revenues are
subject to slgmficant fluctuatIOns due to changes in water demand winch can negatively
Impact the CIty'S ablhty to Implement stormwater programs.
Over the past two years, staff have investigated various alternatives for stormwater management
fmancmg In order to ensure adequate revenues to contmue and expand the CIty'S stormwater
pollutIon control efforts. It has been concluded that the creation of a storm water enterprise fund
IS the best method aVaIlable to allocate costs fauly and to proVide reliable fundmg. The
underlying pnnclple of thiS method of allocatmg stormwater costs IS that each parcel of real
property in the City uses the storm dram system and costs are dIstnbuted In direct proportIon to
the amount of runoff generated The proposed fee remedies many meqmues in the way the CIty
currently funds the stormwater program. TIus IS the same methodology used by most storm water
enterprises In CalifornIa and elsewhere.
BENEFITS OF ESTABLISHING A STO~nV A TER ENTERPRISE
A storm water enterpnse will allocate the costs of stonnwater management by creatmg a CitYWIde
Stonnwater Management User Fee based on the Size and land use of each parcel In the CIty. This
method of financmg offers Important benefits to the Santa Momca community'
(I) PoUution Control Enhancements -- CntIca1 stonnwater pollution control efforts which are
now in the planmng stages Will not be Implemented Without a new source of funding.
These efforts mclude the proposed dry weather flow treatment facIl1ty r the mtenm
chversIOn of flows from the PIer storm dram to the sewer system, enhanced catch basin and
street cleamng, and monitonng and enforcement of the City's Urban Runoff Ordmance.
These programs are all necessary to achIeve the goals and targets of the CounCil adopted
Sustainable City Program.
4
(2) Environmental Benefits -- The City needs to insure long-term financIng In order to
Implement Vital multI-agency and regional Santa Monica Bay clean-up and protectIOn
programs (NPDES and the Santa Monica Bay Restoration Project).
(3) Strengthened Stonnwater Program Coordination -- The proposed storm water management
fee will allow staff to focus the City's efforts and ensure conSistent levels of inter-agency
cooperatIon on pressmg storm water issues.
(4) Economic Benefits -- The City'S tounsm economy, which accounts for nearly 5,000 Jobs
and $300 mtlhon m annual VISItor spending, IS dependent on a pOSItIve publIc Image of
Santa Momca beaches resultmg from an effectIve stormwater management program. The
City of L.A. estImates a 50 % decrease m beach attendance from 1983-1993 due to fear
of beach pollution. The program enhancements which WIll be made possible by the
stormwater fee should help reverse this trend.
(5) Flood Control System Improvements -- In order to prOVIde for the safety of reSIdents of
the CIty and to protect property from flood damage, on-goIng malntenance and
improvements to the storm dramage system are necessary and must be adequately funded.
(6) Improved Accountability -- AssIgmng all stormwater management costs to the new
Stormwater Enterpnse Fund Will enhance the abIlity to track goals and objectIves and to
analyze cost effectIveness of the City's stormwater management programs.
THE ESTABLISHMENT OF A STOAAI\VATER ENTERPRISE
In a report prepared by Kennedy/Jenks Consultants in 1994, various alternatJves related to the
development of a funding source for storm water actIVItIes were evaluated. Based on thiS review,
Kennedy/Jenks recommended that the CIty estabhsh a stormwater enterpnse to operate, malntam
and fund the CIty'S storm dram system and create a Stormwater Water Management User Fee to
finance costs related to storm water management AdditIonally, Kennedy/Jenks reviewed
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mechamsms for collectmg revenue for the enterpnse and concluded that the user charge could be
most efficiently collected through the L.A. County Tax Assessor, both because the City would
not have to create a new bIlbng system based on parcel ownership (rather than water customers),
and because the collectIOn system which IS already In place for unpaid parcel charges is well
establIshed and effectIve.
MUfficIpabhes are authonzed under the CalIfornia Health and Safety Code, SectIon 5471 to collect
fees for storm drainage services and facilities. Fees for storm drainage improvements and the
operation and maintenance thereof are also authonzed under California Government Code SectIOn
54300 et Sel:!. (State Revenue Bond Law of 1941). These fees are also authonzed pursuant to
Cahfonua Constltutlon ArtIcle XI, SectIon 5 and 7. Using thiS general authonty, the Citles of Los
Angeles, Santa Clanta, Berkeley, Ontario, Hayward, Modesto, Monterey, Palo Alto, Sacramento,
Santa Cruz and San Jose have estabhshed stormwater management charges.
Stormwater enterprise customers are charged for servIces prOVided by the enterpnse and pay rates
based on an estabhshed schedule. As a enterpnse functIon of the City, the stormwater enterpnse
fund can only be expended for stormwater related purposes.
STORl\-IW A TER PARCEL REPORT
A Stonnwater Parcel Report descnbmg the affected parcels and speCIfic costs must be approved
by the CouncIl for submittal to the County for bIlling. ThIS report was filed WIth the City Clerk
on July 11, 1995 and has been avaIlable for pubhc reVIew. All affected property owners were
notIced by mail on July 12, 1995 and a public notice has been pubhshed 10 the local paper on July
11 and July 18, 1995 regardmg the pubhc hearing to approve the Stonnwater Parcel Report Once
the Storm water EnteIpnse IS estabhshed, the CIty WIll be reqwred annually to prepare and approve
a Stormwater Parcel Report to be submItted to the County Tax Assessor on or before August 10th,
following a publIshed pubhc notlce. ThIS report IS based on the most accurate parcel database
available to the City for calculatmg the stormwater parcel fee.
6
CURRENT STORMW A TER MANAGEMENT BUDGET
The CIty'S storm water management program consists of operations and maIntenance to the CIty-
owned stormwater system; comphance wIth Federal, State and local regulations, includmg
Inspectlons, momtoring and enforcement; ImplementatIOn of the Santa MOnIca Bay RestoratIOn
Plan; capital Improvement projects such as the Pico-Kenter/Pier low-flow treatment plant and the
fuel spill detectIon system; and an extensive publIc education and outreach effort.
A brief descnption of proposed storm water management programs by division is listed below in
Table 1. The total stormwater management budget for FY 1995-96 is $1,097,322, wIth the FY
1996-97 budget projected to Increase to $1,223,478 to allow for implementation of the various
enhancements descnbed preVIously. A prOjected 5-year stormwater budget IS detaIled as
Attachment A.
Table 1.
SUMMARY OF STORM\VATER PROGRAl\IS BY DIVISION
Total Costs FY 1995/96 $1,097,322
DIVISION Operations Budget STODfW A TER PRO GRillS
Bud~et Percent
Wastewater $516,496 47% Storm water CoordlllatlOn, Storm dram
DIVISion mamtenance, Industnal Pretreatment
Program, NPDES enforcement and
mOllitonng, Catch basm c1eanmg, llliCll
dIscharge preventlOn, Street sweepmg (fund
transfer)
Engmeenng $ 54,079 5% ReVIew of Urban runoff mItigation plans,
DIVISIOn Storm Dram Master Plan, Catch Basm PIlot
Program, Replacmg and upgradmg
stormwater facilItIes, DeSIgn of stormwater
caPltaJ prolBcts, mcludml!. treatment faCIlitIes
EnVIronmental $176,747 16% Pubhc EducatIOn and Outreach. Household
DIVISIOn Hazardous Waste, Small Busmess Waste,
Used OIl Recychng, PollutIon PreventIOn
Programs and Sustamable City Program
CapItal $350,000 32% Stonn Dram Connector PIpes, PICO-
Improvements Kenter/Pler Low Flow Treatment FacilIty
and Plco-Kenter Pollution Sensor System
Enhancements
7
STORMW A TER ENTERPRISE BILLING STRUCTURE
Stormwater revenue reqUlrements have been dIstnbuted to the users of the stormwater system
based on the parcel SIze and a runoff factor, related to the average pervIOus to Impemous ratIo
for various land uses. This methodology IS a common approach in allocatIng storm water costs
because It dIstributes costs In dIrect proportIon to the amount of runoff mto the storm water system
from each parcel. ThIS methodology has been used by the L.A. County Flood Control DIstnct
since 1979.
The bIlling rate IS based on a standard BasiC Measuremeru Urn! (BMU) WhICh IS the proportIonate
runoff from the average smgle fanuly resIdentIal parcel. A BMU IS equal to 0.0637, whIch IS the
product of multIplymg an average smgle famIly parcel, WhICh has an area of 0.1526 acres (6,650
square feet) by the reSIdentIal runoff factor of 0.4176. The number of Parcel BIllIng U mts (PBU s)
for a partIcular parcel, except for smgle-famIly reSIdentIal, IS determmed by the followmg
formula:
Number of PBDs = Parcel SIze In Acres x Land Use Runoff CoeffiCIent
BasIc Measurement UnIt [(0.1526 x 0.4176) = .0637]
Smgle famIly residences would be billed one PBU, regardless of size.
The Basic Fee per PBU is determIned by the total number of PBUs in the CIty diVIded by the
storm water management budget. The baSIC fee for the first year of operatIon wIll be based on the
Projected Stormwater Management budget for 1996-97. DlvIdmg the FY 1996-97 budget of
$1,223,478 by 33,792.74, the total number of PBUs In the CIty, results In a BaSIC Fee of
$3.02/month.
In order to Insure a smooth tranSItIon from the prevIOUS fundmg method to the Stormwater
Management User Fee, staff recommends phaSIng In the Stormwater Management User Fee over
a two year penod Usmg thIS approach, only half of the storm water budget would be recovered
m the first year (FY 1995-96) to be utIlized m FY 1996-97, WIth a corresponding Basic Fee of
8
$1 51/month. Dunng 1995-96, therefore, stormwater management costs wIll contmue to be borne
entIrely by the Wastewater Fund. A summary of esttmated monthly costs per land use for
privately owned property IS provided In Table 2.
Table 2. Estimated Monthly Costs of Stonnwater l\Ianagement User Fee
Land Use Acreage No. Parcels PBUs A vg IVlonthly Cost/Parcel
FY 95-96 FY 96-97
Smgle Family 1,295 6,609 6,609 $ 1.51 $3.02
Condo (per unit) 191 7,251 2,449 $ 0 51 $ 102
Mulu-Fanuly 825 4,329 9,588 $ 334 $669
Commercial 794 2,188 9,510 $ 656 $13 12
The Stormwater Parcel Report detaIls the precIse fee for each parcel based on the methodology
descnbed above.
DISTRIBUTION OF STORM\V A TER COSTS
The distribUTIon of costs for the FY 1996-97 stonnwater management budget among vanous land
use classificatIOns IS as follows:
9
Distribution of Cost by Land Use
Com/lndust
28%
Public Use
17%
,
.",
...
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7%
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Based on CouncIl member dIreCtiOn, City staff has been workmg with the Rent Control Board
staff to prOVIde them With mformatIon regardmg the mechamcs of the fee. A staff report has been
prepared for the Rent Control Board Meetmg July 20, 1995 which recommends that the
Stormwater Management User Fee be allowed as a dIrect pass-through
Non-City governmental (such at the School DIstnCts, State and County) parcels are not authonzed
to pay the portIon of the budget attnbuted to proposed capItal expendItures, therefore the annual
fee these parcels pay wIll be reduced by the appropnate percentage. A breakdown of costs by
land use]S detaIled m Attachment B.
COMPARISON OF STORI\I\VATER FEES IN OrnER CALIFORNIA CITIES
MumcIpal entitles throughout the country and the State of CalIforma have establIshed enterpnses
to fund storm water management. A survey of CalIfornia citles whIch have taken a leadershIp role
10
by establishmg dedIcated fundmg for stormwater programs IS summarized In Table 3. The
average monthly stormwater enterpnse charge IS $3.56 for a smgle famIly parcel. Many of these
cIties are currently conSIdering Increases to these charges to respond to heIghtened operatIonal and
regulatory demands.
Table 3. SUl\1MARY OF SINGLE FAl\ULY STORMWATER FEES IN CALIFORNIA
I CIty I Year Authorized I Avg Monthly Rate I
Sacramento 1982 $10.46
Palo Alto 1990 $ 4 05
Berkeley 1991 $ 4.17
San Jose 1976 $ 3.75
Modesto 1992 $ 3.40
Santa Monica (proposed) 1995 $ 3.02
Hayward 1992 $ 2.40
Santa Clanta 1994 $ 2.00
Los Angeles 1990 $ 1 92
Monterey 1994 $ I 74
Santa Cruz 1994 $ 1.51
Average (excl Santa MOllica) $ 3.56
BUDGET/FISCAL ThfPr\.CT
The proposed Stormwater Enteqmse OperatIons would be organIzatIonally located in the
Wastewater DIVISIon, with reImbursement for all elIgIble storm water program costs paId by the
Stormwater Fund VIa Inter-fund transfer. Revenues from stormwater fees collected by the L.A.
County Tax Assessor's billing system would not be received untIl the latter half of the fiscal year.
Therefore, It IS proposed that the storm water enterprise contmue to be funded VIa the Wastewater
Fund through June 3D, 1996, and that the storm water charges collected dunng FY 1995-96 be
applted to finance the storm water enterpnse startmg In FY 1996-97. The total revenue estImate
11
from the proposed fee in FY 1995-96 IS $ 611,739. ThIS revenue WIll be receIved in revenue
account number 34-500-661-00000-0550-10000.
CEQA STATUS
The parcel fee IS not subject to CEQA review smce It IS not a project pursuant to 14 Cal. Code
Reg SectlOn-15378.
CONCLUSION
Approval of the Stormwater Parcel Report wIll create a funding mechamsm for the Storm water
Enterpnse and ensure rellable and eqUItable fundmg for cntlcal stormwater management and
beach/ocean pollutIon control aCtIvItIes, mcludmg sIgmficant expanSIOn of eXIstmg programs and
Implementation new programs/efforts over the next few years.
RECOMMENDA TION
It IS recommended that CIty CouncIl approve the Stonnwater Parcel Report descnbmg each parcel
In the City that receIves a property tax bIll from Los Angeles County Tax Assessor's Office and
detaIling the amount of each parcel's Stormwater Management User Fee.
Prepared by CraIg PerIons, DIrector EnVIronmental and Public Works Management Department
John Mundy, UtIlitIes Manager
BII11 Romam, Semor AdmmistratIve Analyst
Attachments: Attachment A-Stormwater Management Budget 5- Year ProjectIOn
Attachment B-Estlmated Costs for Stormwater Management
12
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