ITEM 8: APPROVAL OF A STATE REVOLVING FUND (SRF) LOAN FOR THE CITY OF THOUSAND OAKS (CITY), HILL CANYON TREATMENT PLANT EXPANSION AND UPGRADE, SRF LOAN PROJECT NO. C-06-4429-110

DISCUSSION: In accordance with the State Water Resources Control Board's (SWRCB) Policy for Implementing Policy for Implementing the State Revolving Fund for Construction of Wastewater Treatment Facilities (Policy), adopted on February 16, 1995, and amended on June 18, 1998, projects on the adopted priority list need SWRCB approval to receive a SRF loan. Loans can be approved by the SWRCB after the Division of Clean Water Programs (Division) has approved the facilities plan, including (1) the project report; (2) environmental documents; (3) the draft revenue program; and (4) the water conservation plan.

On September 8, 1998, the Division issued Facilities Plan Approval to the City for the construction of the Hill Canyon Treatment Plant (HCTP) Expansion and Upgrade, and the City agreed in writing with the approval on September 9, 1998.

The City is located in southern California about 35 miles northwest of central Los Angeles. The City owns and operates the HCTP a 10.8 million gallon per day (MGD) tertiary wastewater treatment plant. The HCTP treats an average daily flow of about nine MGD and discharges effluent to the North Fork of the Arroyo Conejo Creek. The HCTP was originally constructed in 1960 and has undergone several incremental expansions and modifications.

In order to meet more stringent future discharge requirements and prepare for expansion, the HCTP is in need of repairs and reliability and operational improvements. The City is planning to expand the HCTP to 14 MGD, and is also undertaking a Watershed Characterization Study with others, required by the local Regional Water Quality Control Board, to develop a site specific ammonia objective for the receiving waters as an alternative to meeting the upcoming Basin Plan ammonia objective.

The City submitted the final plans and specifications for this project in July 1998, and received Final Plans and Specifications Approval from the Division on September 11, 1998.

The City's domestic water supply is provided through purchase of imported water from the Calleguas Municipal Water District which receives its supply from the Metropolitan Water District of Southern California (MWD). The source of MWD's supply is imported from either the State Water Project, or the Colorado River. The City is also working on a proposal, the Conejo Creek Diversion Project, which could deliver more that 10,000 acre-feet per year (AFY) for beneficial uses in surrounding areas. This project would reduce groundwater pumping and seawater intrusion in these areas, and reduce the need for imported water. The City is also working on a plan to utilize 2,000 to 4,000 AFY of local available groundwater without impacting the basin.

The MWD has adopted long term plans designed to ensure the adequacy and reliability of water supplies to their service areas beyond the next 20 years. In accordance with the SRF Policy requirements for water conservation, the City is a signatory to the State Water Coalition's Memorandum of Understanding Regarding Urban Water Conservation in California (State MOU) and is a member agency of the California Urban Water Conservation Council (CUWCC). Signatories to the State MOU must submit an annual report to the CUWCC outlining progress in implementing the Best Management Practices for water conservation.

The City determined that the project was categorically exempt from the California Environmental Quality Act (CEQA) under Categories 1 and 2 in the CEQA guidelines. The City filed a Notice of Exemption with the Ventura County Clerk on August 25, 1998.

The City requests the SWRCB approve a loan of $2.37 million for this project and agrees to pay back the loan in accordance with the SRF Policy.

POLICY ISSUE: Should the SWRCB approve SRF loan funding for the proposed project, including a 20-year repayment period, with the first repayment due one year after completion of construction. The Division has already approved the plans and specifications for the City's project.

RWQCB IMPACT: Los Angeles RWQCB. Approval of this SRF loan will the City of Thousand Oaks to prepare the Hill Canyon Treatment Plant for expansion and improvements to meet service area growth needs and more stringent Waste Discharge Requirements.

FISCAL IMPACT: According to SWRCB Resolution No. 97-001 (Approval of a Staff Proposal to Better Manage the SRF Repayment Account), the SWRCB may approve preliminary loan commitments against the current FFY account and against 125 percent of future repayment funds based on scheduled loan dates.

The SRF account balances, anticipated repayment amounts, and project approvals under consideration by the SWRCB in November 1998 are as follows:

* Minimum Cap. Grant expected for FFY 98-99, based on anticipated Federal Budget.

STAFF RECOMMENDATION: That the SWRCB adopt a resolution approving a SRF loan for the proposed project, with a repayment period of 20 years, and with the first repayment due one year after completion of construction.

DRAFT 26 Ocotber 1998

WHEREAS:

1. The State Water Resources Control Board (SWRCB), on February 16, 1995, adopted the "Policy for Implementing the State Revolving Fund for Construction of Wastewater Treatment Facilities," and revised it on June 18, 1998;

2. The SWRCB, on June 18, 1998, adopted the FFY 1999 SRF Loan Program Priority List which included the Plant Expansion and Upgrade for the City of Thousand Oaks in priority Class C;

3. The Division of Clean Water Programs (Division) has approved the facilities plan;

4. The City is signatory to the State Water Coalition's Memorandum of Understanding Regarding Urban Water Conservation in California; and

5. The City filed a Notice of Exemption for the project, which has been reviewed and considered and it has been determined that the project is exempt from the California Environmental Quality Act (CEQA) under Categories 1 and 2 in the CEQA Guidelines.

THEREFORE BE IT RESOLVED THAT:

The State Water Resources Control Board approves a SRF loan of $2.37 million to the City of Thousand Oaks for the construction of improvements at the Hill Canyon Treatment Plant. The repayment period shall be 20 years, and the first repayment due one year after completion of construction.

The undersigned, Administrative Assistant to the Board, does hereby certify that the foregoing is a full, true, and correct copy of a resolution duly and regularly adopted at a meeting of the State Water Resources Control Board held on November 19, 1998.

Maureen Marché

Administrative Assistant to the Board