HomeMy WebLinkAboutCC 2026-06-23_11a Canyon Crest Off Site Wastewater Treatment_PP
Pre-application 26-001:
Canyon Crest Off-Site
Wastewater Treatment
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Background
Canyon Crest comprised of 54 single-family residences outside of city limits
The development’s private water company operates its wastewater treatment system
Tonight we will be talking about Canyon Crest, a subdivision consisting of 54 SF homes, located between Husna Rd and Stagecoach Rd, outside of Arroyo Grande’s city limits.
The development’s private water company operates and manages the wastewater treatment system for the tract.
The system consists of individual septic tanks on each of the 54 residential lots to collect wastewater, then effluent is conveyed to a community leach field adjacent to Huasna Road.
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Notice of Violation
On Oct. 14, 2022, the RWQCB issued a NOV to the private water company
Failures of the wastewater treatment is resulting in elevated nitrate concentrations in groundwater
On Oct 14, 2022, the Regional Water Quality Control Board issued the water company a notice of violation because it was determined that the wastewater treatment system was the source
of ground water contamination.
The water board found that the elevated level of nitrates in the groundwater were a public health issue because it was affecting surrounding water resources beyond this development.
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Potential Solutions
Building an on-site wastewater treatment facility
Startup costs: $1.5-2M
Annual operating costs: $83k-$108k
2) Wastewater consolidation for treatment at SSLOCSD
Startup costs: $700k-$1M
Annual operating costs: $50k-$60k
The applicant team identified two potential solutions to abate the violations.
Construction and operation of an on-site wastewater treatment facility at an initial cost of 1.5-2 million,
The second, and preferred option, consists of consolidate the development’s wastewater and send it through City sewer infrastructure for treatment at the Sanitation District’s treatment
plant in Oceano. This option has startup costs of approximately $700k-1 million.
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Wastewater Consolidation
Install ~1,000 ft of sewer pipe to connect to existing City infrastructure
Wastewater would rely on City infrastructure to travel to treatment facility
To convey wastewater effluent to the treatment plant, the HOA would be responsible for installing and maintaining approximately 1,000 ft of sewer pipe to connect to the City sewer system.
The point of connection within City limits is at the intersection of Huasna Rd and Pearwood Avenue.
Wastewater would travel from that point to the treatment plant, at which the Sanitation District has confirmed the plant has capacity to serve the development
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Annexation
Canyon Crest is located outside of the Sanitation District’s service area
Annexation into Sanitation District is subject to review and approval by LAFCO
However, because Canyon Crest is located outside of the Sanitation District’s service area the tract would need to be annexed into the service area for this plan to move forward.
Want to be clear that in this context annexation only involves a change in the boundary of the Sanitation District service area – and does not involve annexation into the City or obligate
the city to provide any other services.
Annexation requests are subject to review and approval by the Local Agency Formation Commission (LAFCO)
LAFCO is a planning and regulatory agency established by State law to encourage orderly and efficient provision of governmental services such as water, sewer, and fire protection.
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Annexation Process
MOU to establish the framework and identify items to be included in the annexation agreement
Use of infrastructure
Maintenance responsibilities
Connection and service fees
Upon agreement on the framework the HOA would apply for annexation
Attachment 5 to the staff report describes the process for annexation but this presentation describes the first step, which involves the three parties negotiating a Memorandum of Understanding
to establish the framework of the annexation agreement
The three parties are Canyon Crest, the Sanitation District, and the City.
The MOU would identify items that need to be agreed upon, such as specified use of City infrastructure, describe maintenance responsibilities, and identify fees.
With mutual agreement on the terms of the MOU, the applicant would apply for annexation with LAFCO.
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City Role
Primary role includes allowing pass-through of wastewater
City would provide billing and administration (with cost recovery)
City to receive applicable connection and capacity fees
Contribution to Lift Station No. 3 upgrades
Primary role of the City in the annexation agreement would be allowing wastewater effluent to pass-through City sewer infrastructure to reach the sanitation district’s treatment facility.
The City would also provide billing and administration of the customer account
If annexation is approved, the City would collect connection fees and a financial contribution from the applicant for planned upgrades to Lift Station 3 located along Huasna Rd.
The exact amount of the fees and contribution would be determined during the MOU and annexation agreement process.
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Next Steps
Purpose of pre-application is to gauge Council’s support
If supportive, applicant would engage in additional technical studies and analysis
Staff would negotiate the MOU
Can return MOU to Council for further consideration of support prior to annexation application
Council would need to approve annexation agmt
Purpose of tonight’s pre-application discussion is to gauge whether Council is conceptually supportive of the annexation request
If supportive, the applicant would engage in additional technical studies and analysis to support its application to LAFCO
Staff would negotiate the terms of the MOU with the Sanitation District and applicant. Staff can return with terms of the MOU prior to an application for annexation by Canyon Crest.
Assuming that the applicant makes an application for annexation, the City Council would be asked to consider approval of that annexation agreement.
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1) Confirm informal support for the applicant’s proposal to consolidate wastewater service from the Canyon Crest HOA to the South San Luis Obispo County Sanitation District’s treatment
facility, which would require the City to approve an annexation agreement to coordinate infrastructure use, responsibilities, and service delivery prior to LAFCO approval of annexation;
and
2) Find that the recommended actions are not subject to the California Environmental Quality Act (“CEQA”) because these efforts have no potential to result in either a direct, or reasonably
foreseeable indirect, physical change in the environment. (State CEQA Guidelines, §§ 15060 (c)(2) and (3), 15378)
Recommendation
Staff recommends Council confirming conceptual support for the applicant’s proposal to consolidate wastewater from Canyon Crest to the Sanitation District’s treatment facility, which
would require the City to approve an annexation agreement prior to LAFCO approval, and
Find that tonight’s action is not subject to CEQA pursuant to CEQA Guidelines Sections 15060C2 and 15378.
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