‘We have listened to the community’: Morro Bay council picks site for new sewer plant

This site off Highway 1 near South Bay Boulevard has been chosen for the new location of the Morro Bay wastewater treatment plant.
This site off Highway 1 near South Bay Boulevard has been chosen for the new location of the Morro Bay wastewater treatment plant. dmiddlecamp@thetribunenews.com

After nearly five years of juggling demands of residents, regulators and possible funding sources, the Morro Bay City Council on Tuesday narrowed its sights to one preferred location for its long-needed new wastewater treatment plant.

In a unanimous vote, the council selected roughly 15 acres of unincorporated San Luis Obispo County property near the intersection of South Bay Boulevard and Highway 1 over less expensive options closer to the ocean.

From here, things could start moving fast. The city’s now under the gun to meet a series of deadlines for environmental review to secure low-interest government loans dependent on having a project underway.

“Tonight, we have to take ownership of our project,” Councilman Robert “Red” Davis said.

During the heated standing-room-only meeting, more than 200 residents crammed into Vet’s Hall throughout the night, some carrying signs reading “Citizens of Morro Bay need a sewer we can afford” and others “Go east! Of Highway 1.”

While a slim majority of residents during public comment angrily urged the council to build a wastewater treatment plant at the site of its existing oceanfront facility, others urged the city to follow the guidance of state regulators and proceed with the site off South Bay Boulevard, east of Highway 1.

Though the most expensive of five possible locations, the South Bay Boulevard site would avoid significant environmental hazards such as coastal erosion, flooding and tsunamis, and it stands the best chance at being permitted, some speakers said.

“We have listened to the community,” Councilwoman Marlys McPherson said prior to the council’s vote. “We really feel like we’ve done our due diligence.”

SEWER SITE 2016_Tribune

In supporting the location, council members noted it spared the project from coastal hazards, that a master plan for the site has already been drafted and vetted, that it’s far from residential areas, and that a non-binding agreement to purchase the land is already in place.

According to city report released this month, capital costs for a treatment plant and a water reclamation facility at the South Bay Boulevard site will cost roughly $150 million, and operating and maintaining the facility would cost an estimated $3.7 million annually. The property would cost about $300,000 to purchase from the county, Public Works Director Rob Livick said Wednesday.

Downsides to the location, according to the report, include costs 8 to 21 percent higher than other sites and the long distance of piping required to pump raw wastewater. Those costs could translate to water bills projected between $207 and $241 per household per month, though the city says those costs are likely to drop.

The city’s current plant near the ocean at 170 Atascadero Road is deteriorating and is in violation of state water quality standards on busy days, which will lead to significant fines once a waiver expires, according to the Regional Water Quality Control Board.

Building a wastewater treatment plant in a (100-year flood zone) in the 1950s was a bad idea then, and it’s a bad idea now.

Morro Bay resident Thomas Kessler

Some of the funding for the treatment plant and reclamation facility could be fronted through State Revolving Fund financing, a low-interest government loan program.

In July, the city was also selected to apply for a low-interest $82 million U.S. Environmental Protection Agency loan. But environmental review must be completed for the city to apply by the July 2018 deadline. Livick said the city’s consultants have said the review could be completed in June.

The South Bay Boulevard location has been a focus for some time, but based on a recommendation by a peer review panel in July, the council hit a 60-day pause on the project to re-investigate the feasibility of an oceanfront plant due to the high cost of the South Bay Boulevard site and public outcry.

That review and the prospect of the EPA loan and other possible grants reinforced that the site is the best choice to residents like Thomas Kessler and Glen Silloway, they said Tuesday.

“Building a wastewater treatment plant in a (100-year flood zone) in the 1950s was a bad idea then, and it’s a bad idea now,” Kessler said.

“We’re right up against it... We need to be in a position apply for these loans,” Silloway said. “We can’t afford to gamble with our future.”

This has become a charade in terms of public input.

Morro Bay Planning Commissioner Richard Sadowski

Other residents, such as Rob Kitzman, told the council that a $150 million facility is too expensive for the city of about 10,600 residents and rising water rates would cripple local businesses.

“This would irreparably restrict the economy of this community,” Kitzman said. “With no small business, there is no tax base — there is no city.”

Planning Commissioner Richard Sadowski, who refused to step aside when his allotted speaking time was up, claimed the council has ignored the public’s opposition to the expensive plant.

“This has become a charade in terms of public input,” Sadowski said, before Police Chief Gregory Allen urged him to leave the podium.

After selecting its preferred site, the council directed staff to come back at the Oct. 10 city council meeting with a detailed timeline for keeping up with regulatory, financial and public outreach requirements.

That timeline will also include further discussion with consultants on water rates, re-examining whether a consultant should stay on as project manager and formalizing the goals of the project for the bidding process.

Sewer sites not chosen

The following sites were not selected by the Morro Bay City Council as preferred locations for the city’s upcoming wastewater treatment plant and water reclamation facility.

  • Hanson/RV Storage property: A roughly 12-acre area adjacent to the existing wastewater treatment facility currently an RV storage and concrete manufacturing site. The lowest-cost option, a combined wastewater treatment and water reclamation facility at the site comes to an estimated $124.8 million. However, a permit for a previously proposed plant at an adjacent site was denied by the Coastal Commission in 2013, and the agency has warned it is unlikely to approve a similar project due to a host of environmental concerns, namely erosion and sea level rise, but also its location in 100-year flood and tsunami inundation zones.
  • Dynegy Tank Farm: A vacant 9-acre area northwest of the power plant and south of Morro Creek estimated to cost $131.3 million to develop. While close to existing wastewater infrastructure and not subject to some coastal hazard zones, the site is near homes and the high school, and the permitting process is expected to take up to 2 years.
  • Righetti: Approximately 10-15-acres at the site of an existing ranch house north of Highway 1 just west of Rancho Colina Recreational Vehicle Park, the city estimates the project at this site to come to about $133.7 million. Though the site held several benefits over the South Bay Boulevard location such as lower elevation and potential for land conservation, strong opposition from nearby neighbors and the threat of litigation could lead to unexpected costs and community problems.
  • Giannini: About 10 acres of a 35-acre property near Hillcrest Drive and Little Morro Creek Road, east of Highway 1, would cost an estimated $138.7 million. Though the city identified advantages over the South Bay Boulevard site, neighborhood proximity, property availability and anticipated road improvements were identified by the city as key constraints.

Note: Costs for building facilities on these sites do not include costs to purchase property.

Source: Sept. 26, 2017 City of Morro Bay Water Reclamation Facility Project Updated Site Comparison Report

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