| Home | Office | Board | Facts | Contacts | Water | Wastewater | Links | Conserve | Documents | Site Map |
|
|
South Village Water Reclamation Project FAQ |
A. Characterizing the information we have on the project at this point as ambiguous is, unfortunately, accurate. However,the only way to move toward more refined and certain information is to determine what the project will be in terms of capacity. The only way we can do that is to determine who among the study area’s property owners is ready to make a financial commitment at least to the level of being able to determine the scope of the project. In some ways, it is a classic Catch 22.
Q. The range of costs to connect, $35,000 to $40,000, seems very expensive. Why is it so expensive?A. Wastewater systems are generally expensive to construct. The proposed system is very small and does not have the economy of scale benefits found with larger systems. As an inland discharge system, all treated wastewater must be reclaimed, which requires a distribution and seasonal storage system, adding more expense.
The range of costs quoted is very preliminary and, at this stage of the project, have a large contingency factor built into the numbers. Actually, costs will be impacted by how many properties participate and how much capacity is needed in the project. As we move forward with better defining the project, we will be able to refine the numbers.
We would rather start off with a high number for your financial planning and work down, than to start off with a low number and then have it increase over the course of the project.
In the final analysis, at this point in the project, there is a high degree of risk involved. But if the risk is not taken, there will not be a project at all.
Q. You are asking for a cash commitment of $2,500 per EDU at this point, and have stated that in 9 to 12 months, there will be a need for another cash call of up to $2,500 per EDU. Are there any options for meeting the second cash requirement other than a cash call?A. There are two other options available; those being the formation of a Preliminary Assessment District, or the use of lien agreements both as a method of securing the district’s investment in continued studies and work on the project. There is significant expense in forming a Preliminary Assessment District and the individual lien agreements essentially provide the same security.
Given these circumstances, we will allow the option of either a cash contribution or a lien agreement, with an administrative fee charged for processing the lien agreement.
Q. Is the District capable of securing underwriting and financing for this project, even if the property owners wish to move forward?A. The Valley Center Municipal Water District has a long history of securing and successfully repaying various forms of public financing, including bonds, federal and state loans, as well as Improvement District, Assessment District, and Community Facilities District financing. Today, the District is financially stable with ample revenues and reserves to secure its operations and various debt obligations. Obtaining financing for this or any other assessment district will not be an issue.
In addition to the sound financial condition of the District is the consideration that the underlying security for an assessment district debt issuance is the properties contained within the assessment district area. Prior to actually forming the assessment district, an appraisal of all properties will be conducted to determine their respective values. From these values, a debt to equity ratio will be developed to determine the security of the debt liens issued against the properties in the assessment district. The higher the ratio, the more secure the debt and the lower the interest rate. If the properties in the assessment district meet the debt to equity ratio, then successful underwriting and debt issuance is almost assured.
Q. Beyond the annual charge on the tax bills for the Assessment District bonds issued to build the facilities, will there be monthly charges for the operation and maintenance of the system?A. The short answer is yes. There will be monthly charges for those actually using the system, as well as standby charges for those eligible to use the system but not connected. Though we do not have an exact number for this project, the Woods Valley Ranch Water Reclamation Facility ("WVRWRF") charge is near $100.00 month and would expect charges for other systems in this general area to be roughly the same.
These charges are relatively high compared to other areas for two reasons:
1. These are small scale operations and in an area where economies of scale are important, we essentially have no economy of scale. As we move forward, we would expect that as the WVRWRF serves more EDUs, the cost per EDU served would be moderated, though there will be counter balancing upward inflationary and regulatory pressure on what we charge for service.
2. The monthly charge will not only pay for the operation and maintenance of the facility, but will also create a sinking fund to pay the cost of ultimately replacing the system at some point in the future.
Q. What happens to the investment made by the property owners up and to the point where the project is stopped?A. If all of the money collected in the initial cash deposits has been spent at the point and the project is stopped, that money is gone. If the project is stopped at the point of Assessment District Formation and Debt Authorization, all cash spent at that point is lost, and the District will take action to exercise any lien agreements on properties in the proposed Assessment District area. Any unspent cash will be refunded on a prorated basis to those who made the deposits.
A. The ideal situation for this project would be that the GP 2020 Update is done and its environmental document certified at this time. If this were the case, there would be less uncertainty for the District as to how to plan the project and for the property owners as to how much capacity to reserve in the project.
Since the Bell, Alti, Olson Group have expressed a desire to move forward at this time, the District wants to determine if any other property owners would want to move forward at this time also.
However, with GP 2020 not completed at this time, the realities of an environmental review process require that we move forward based upon the existing Country Town Zoning. For some property owners, the difference in development yield and ultimately the allowed maximum capacity in the project between the two land use plans is minor; for some it is very significant. Waiting for GP 2020 to be completed might be an option, but would add another year to two years on to the current project timeline.
Q. What if, during the course of this project, GP 2020 is approved with higher zoning densities allowing additional EDUs, would property owners have an opportunity to increase the number of EDUs reserved for their respective properties?A. It would depend on at what point in the project this would occur. The further along in the project, the more difficult and costly it would be to make the changes. If the project is still in the preliminary planning stages, it would be easier to make the change than if it were in the environmental review stage. But changes in the environmental review stage would be easier to make than after the project environmental review had been completed and the project was designed. Changes at this point would require a supplemental environmental document and a redesign for portions of the project.
However, if GP 2020 is approved after the Assessment District has been formed and the bonds issued, it would not be feasible to make any major changes to the project at that time.
So the answer to this question really depends on when GP 2020 is adopted.
A. An EDU, or "Equivalent Dwelling Unit" is a measure of flow capacity required for a home or business connected to the wastewater treatment system. The number of EDUs in a project will determine the size of the collection system, treatment capacity, disposal areas and seasonal or wet-weather storage needed for the system.
Our District has adopted a flow rate of 250 gallons per day per EDU as the standard. A single family home is normally assigned one EDU. EDUs for commercial developments depend upon the size and type of development. With restaurants or other commercial processing operations, the flow volume, and intensity of the wastewater’s "biological demand" will effect the case by case EDU calculation.
Q. How is the number of EDUs determined for an individual property?A. Generally, the size of the property and its zoning determine the development potential and thus the EDU need for a specific property.
For a single family home, one EDU is normally assigned. For commercial properties, the number of EDUs will depend on the size (sq.ft), type (office building vs. restaurant) and intensity of development. The number of EDUs for an auto supply store with one bathroom, for a super market, for a 100 seat restaurant will all be different. The County Department of Health Services has developed guidelines which the District will use to assist property owners in determining how many EDUs will be needed for an individual property.
Q. What will be the disposal method for the treated effluent?A. The Woods Valley Ranch Water Reclamation Facility (WVRWRF) is an "inland discharge" system, meaning that all treated effluent must be disposed of through landscape, turf and agricultural irrigation. An important part of this project will be to identify and secure enough sites to safely dispose of the effluent.
Earlier studies indicate that the Woods Valley Ranch Golf Course may have the additional capacity to take more reclaimed water that is generated by the Woods Valley Ranch Development. New commercial and residential development in the South Village area will be required to make provisions to accept reclaimed water for the irrigation of new landscaped areas. We will also look at the proposed medians in Valley Center Road as a possible disposal option. In the past, the Valley Center Parks and Recreation District has indicated a possible interest in using reclaimed water on the baseball fields near the Community Hall. Finally, we will explore the option of taking the reclaimed water to nearby agricultural operations able to utilize reclaimed water for crop propagation.
Q. Why do you need "Wet Weather Storage" and where will it be located?A. Being an "Inland Discharge System" means that the WVRWRF has no access to a land or ocean outfall as do most communities to the west and along the coast. Wastewater coming to the treatment facility is treated and then pumped into the reclaimed water delivery system. In dry weather, all of the reclaimed water will be disposed of through some form of irrigation. During wet periods, when the demand for irrigation is reduced, the wastewater coming to the plant must be treated and the reclaimed water not needed for irrigation must be stored until it is needed in dryer weather. The Regional Water Quality Control Board requires that each system have enough wet weather storage capacity to store 84 days of full treatment capacity.
At this point in the project, three possible sites have been identified, in and around the South Village Area. The actual site will be selected as part of the project, if and when it moves forward.
Q. It is stated that the project will have a "low pressure" collection system. How is this type of system different from other wastewater collection systems and what does it mean to those connected to the system?A. In a conventional system, wastewater flows by gravity to the treatment plant. However, given the location of the WVRWRF and the relatively flat topography in the South Village Area, a conventional system would be very costly to construct, if feasible at all. A "low pressure" system utilizes individual private pump units at each home and business connected to the system to pump wastewater into a collection system with small diameter pipe.
Under the assessment district law, private facilities cannot be financed with the assessment district bonds. As such, the actual cost of purchasing, installing and then connecting the individual units will have to be paid for by the property owner, outside of the cost of the assessment district. It is estimated that for the average residence, the cost will be $4,000 to $6,000, though this could vary upward depending on specific conditions (terrain, distance from the connection point, etc) of each installation. The cost of commercial units will vary based upon the amount of flow coming into the system.
As stated earlier, the on-site units are private, but will be supported through a mandatory maintenance agreement with the District covering the pumping unit and the system control. The maintenance fee will be included in the monthly charge on the unit actually connected to the collection system.
Q. Has the Valley Center Road Project created any problems or considerations with the South Village Project?A. Ideally, the South Village Water Reclamation project would have been designed and funded in time for the collection system construction to be done at the same time the road improvement project was underway. Unfortunately, that is not the case. However, in anticipation of the South Village Water Reclamation Project moving forward after the Valley Center Road Improvement Project, perpendicular "utility sleeve crossings" will be installed along Valley Center Road as part of the District’s waterline project. These crossings could accommodate wastewater line crossings at some point in the future. It is also anticipated that collection line alignments paralleling Valley Center Road will be secured. Finally, three years after the completion of Valley Center Road, the District would be able to secure utility encroachment permits to enter Valley Center Road to install water service and wastewater collection lines.
A. In the early stages of the project there may be an opportunity to expand the number of EDUs. However, as we move into the environmental review and documentation portion of the project and then beyond, it will become more and more difficult to increase the number of EDUs in the project. Certainly, after the assessment district is formed and bonds are issued, the number cannot be changed.
Q. What happens if a property owner "over" or "under" purchases the number of EDUs ultimately needed for the development of the property?A.In anticipation of this potential situation, the District will establish an "EDU Bank", or "pool" administered by the District. Property owners with excess EDUs, will have the option of placing them in the bank. Property owners needing additional EDUs will be able to purchase them from the bank if the EDUs are available, at the original cost, plus the interest cost incurred up to the time of the purchase. Purchase funds will then be transferred back to the original purchaser, or successor in interest, who would have the option of paying off or paying down the assessment on his/her property with those funds.
To prevent market speculation, EDUs will not be transacted directly between property owners.
A. No, you would not be forced to connect as long as you had a functioning septic system, and that determination would be made by the County Department of Health Services. However, even though property is not connected, the annual assessment to retire the bonds would have to be paid, as well as a monthly standby fee to help support the operation of the wastewater system.
Q. Would an EDU from this Assessment District be transferable outside of the Assessment District?A. No.
Q. What could stop the project at some point in the future?A. The project could be stopped by the Board of Directors very soon if there is not enough initial financial commitments received to justify moving forward at this time. Assuming that we do have enough to move forward, we do not see any potential fatal flaws in the project which would preclude obtaining all of the necessary discretionary approvals. Another possible stalling point is when we go for the second round of financial support and a significant number of property owners drop out, making the project infeasible from an economic standpoint. The final point at which the project could be stopped is when the election is held to form the Assessment District and authorize the issuance of debt. By existing California law, a 2/3’s approval vote based upon EDUs will be needed to move forward. If the 2/3’s approval cannot be obtained, then the project stops.
Q. How many EDUs does the Orchard Run Project need, and if it joined in this effort, would the District still need a minimum of 150 EDUs from the small individual property owners?A. At the last point the District dealt with the Orchard Run Project, it would have required 300 EDUs. If Orchard Run was to move forward at this time, its 300 EDUs, plus the estimated 150 from Bell/Alti/Olson, would provide for a feasible expansion. Any EDUs from the smaller, nearby properties would only enhance the feasibility and economics of the project.