HomeMy WebLinkAbout11/17/1992, 6 - SALINAS RESERVOIR OWNERSHIP TRANSFER ALTERNATIVES l,lll�lylll�lllllll�l p1�pII ll�lll
city MEETING DATE:
IBB III�IN�I C,io san �S oBIspO November 17 1992
N� AGENDA RE ITEM NUMBER:
COU A �RT
FROM: John Moss PREPARED BY: Gary W. Henderson
Acting U - es irector Water Division Manager
SUBJECT: Salinas Reservoir Ownership Transfer Alternatives
CAO RECOMMENDATION:
Receive report from staff concerning the transfer of ownership alternatives related to the Salinas
Reservoir and direct staff to proceed with the alternative transferring ownership to the County contingent
on formulation of an agreement between the City and County protecting the City's concerns.
DISCUSSION:
BACKGROUND
The Salinas Dam and Reservoir were built in 1941 by the War Department (now the U.S. Army Corps
of Engineers) to supply water to Camp San Luis Obispo and the City of San Luis Obispo. The Salinas
Project is owned by the Army Corps of Engineers (ACOE) and is leased to the County of San Luis
Obispo for its operation and maintenance. The water from the project is regulated under water rights
permits issued to the Corps and the City of San Luis Obispo. The City is currently the only user of
water from the reservoir. The City is currently proposing to expand the capacity of Salinas Reservoir
in order to meet current and projected future water supply demand in the City. The ACOE has been
interested in transferring ownership of the facilities to a local agency for many years. The City and the
County have not been able to mutually agree which agency should own the facilities. The ACOE has
indicated that the Salinas Reservoir Expansion Project can not proceed until ownership is transferred to
a local agency. This report outlines the currently identified ownership transfer alternatives.
Both the City and County of San Luis Obispo have concerns and issues regarding the ownership of the
property and related facilities. Outlined below are the reasons the County and City feel that each
respective agency should have control of the facilities.
County Issues
■ The Salinas Reservoir is a major recreational facility which the County would like to
expand and develop further. This is one of their major recreational sites in the north
county. The County is pursuing the acquisition of additional land currently controlled by
the Bureau of Land Management (BLM) to expand recreational opportunities in the area.
■ The County Flood Control District currently operates the reservoir and is responsible for
decisions regarding the "live stream." The "live stream" requirement was established by
the State Water Resources Control Board, Division of Water Rights and is a legal
condition of the City's water permit. The requirement limits when the City can store
water in the reservoir and was established to protect down stream water rights. Since the
County Flood Control District operates the dam, the-District decides when the live stream
has occurred and when to begin storing water in the reservoir. The County, as well as the
north county agencies, generally feels that the County control of the live stream is
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COUNCIL AGENDA REPORT
Salinas Reservoir Ownership
Page 2
preferred since the District will not benefit from the decisions made regarding down
stream releases.
■ The County Flood Control District operations at Salinas Reservoir facilities allow for an
efficient use of staff. Personnel assigned to these facilities are assigned to other north
county operations. During special projects more employees can be allocated while during
slow times employees can be reassigned to other areas. This results in a cost effective
operation.
City Issues
I
■ The City needs to protect its Salinas Reservoir water rights. There are currently two
primary sets of water rights on the Salinas Reservoir. The first belongs to the ACOE and
the second belongs to the City of San Luis Obispo. The Corps water right is the senior
right because it was filed first. The City's right is identical but junior since it was filed
second. The ACOE's permit lists the area of water use as Camp San Luis Obispo and the
City of San Luis Obispo. The City's permit shows the City and Cuesta College as the
areas of use. The City needs to make absolutely certain that our water rights are not
jeopardized with the transfer of ownership to a local agency.
I
■ The protection of water quality at the reservoir is of the utmost importance. The City's
water treatment plant is currently undergoing a $10.8 million upgrade in order to comply
with newly mandated water quality regulations. As regulations become more stringent in
the future, it is important for the City to be able to control the quality of its water sources.
■ The County currently operates the facilities to deliver water from the reservoir to the City.
The City pays all the costs associated with the operations for water delivery. The
operations of the reservoir are a major expense to the City but the City has little control
over the operations and budget. The current practice is based simply on the ability of the
each agency's staff to cooperate.
PROPERTY DISPOSAL PROCEDURE ALTERNATIVES
There are three procedural options available to the ACOE for disposal of the Salinas Reservoir Project
facilities. All the options will require studies and surveys as discussed under the section of "Costs
Associated with Ownership Transfer." The alternatives and estimated time frames based on consultation
with the ACOE for transfer are outlined below.
■ The typical method for disposal of the property would be for the ACOE to declare the
property surplus and transfer the disposal responsibility to General Services Administration
(GSA). Once the property has been transferred to GSA, they would typically request bids
from agencies or groups interested in acquiring the property with first offering to federal
agencies followed by state agencies, then local agencies. This process may require a full
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Salinas Reservoir Ownership
Page 3
environmental impact study which the other two alternatives may not require. The transfer .
of property through this alternative would require at least 18 months.
■ The military could declare this property surplus since the facility was constructed for
military purposes. The disposal process could then follow the accelerated property
disposition requirements under the Base Closure Act. The procedures under this act may
simplify the ownership transfer but could allow someone other than the City or County
(including private parties) to purchase the property and facilities. The other possibility is
that after the military declares this facility surplus, it would be turned over to GSA for
disposal as outlined in the first alternative above. This alternative is estimated to take a
minimum of 12 to 18 months.
■ The third option would be to have our local congressman, senator, or other congressional
representative sponsor special legislation which would transfer the property and facilities
to a local agency at no cost. This would reduce the time and some of the required work
which would be necessary at the Corps level. This option would also eliminate the
possibility of an agency or group other than the City or County from receiving ownership.
Staff recommends pursuing this course of action as the first option. This option is
estimated to take less than 12 months to complete following passage of legislation.
COSTS ASSOCIATED WITH OWNERSHIP TRANSFER
Even if the actual property and related facilities are acquired at no cost, there are costs that will be
incurred for studies and surveys that must be completed as a condition of transfer. Woodward-Clyde
Consultants has prepared a preliminary cost estimate for the Salinas Reservoir property transfer and a list
of required studies and surveys. The cost-incurring activities associated with the property transfer are
anticipated to include:
i
1. NEPA Environmental Review
2. Real Estate Transfer Costs
3. Boundary Line Survey
4. Hazardous Materials Evaluation
5. Cultural Resources Review
6. Special Legislative Assistance
For detailed explanation of each item listed above and estimated individual cost estimates, see Attachment
A. The total cost associated with the above activities is estimated to be between $470,000 and $630,000.
These costs are not based on a worst case scenario and were developed through discussions with the
ACOE and the assumptions listed in Attachment A.
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COUNCIL AGENDA REPORT
Salinas Reservoir Ownership
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There will also be costs incurred by ACOE staff to process the disposal of the facilities. The Corps has
requested that $50,000 be sent to the ACOE to develop a fund to draw against for their services.
Depending on which of the following ownership transfer alternatives is mutually agreed upon by the
County and City, these costs should be the responsibility of the agency.or agencies that will eventually
acquire the property.
OWNERSHIP ALTERNATIVES
There are basically four alternatives that staff has identified concerning the ACOE position that the
Salinas Reservoir and related facilities must be transferred to a local agency prior to the implementation
of the reservoir expansion project. These four alternatives are briefly outlined below. Staff is requesting
Council review these alternatives and considering the information previously provided in this report,
provide staff with direction as to the preferred ownership alternative.
City Ownership
The first option would be for the City of San Luis Obispo to acquire sole ownership of the facilities. In
1981, the City Council adopted Resolution No. 4567 stating the City desired to acquire the Salinas Dam
and related facilities. City staff has met with County staff and other concerned agencies many times in
to gain support for City ownership of the facilities. A number of north county agencies do not support
the City obtaining ownership of the reservoir. The main concern is the physical operation of the valves
which release water down stream to comply with the requirements of the "live stream" agreement. These
agencies feel that the County Flood Control is an unbiased third party and is objective in administering
the requirements of the live stream agreement.
A number of involved county staff and elected officials also oppose sole City ownership of the facilities.
The County feels that this facility is a major recreational benefit to all county residents and the control
should remain with the County., Further discussions with the County and North County agencies do not
appear to be promising for resolving their opposition to this alternative.
Joint Powers Authority
The possibility of the formation of a joint powers authority (JPA) has also been discussed with County
staff as well as staff from north county agencies. The JPA would include representatives from the
County, City, and of the north county agencies. The JPA could also include a representative from a
neutral organization such as the Department of Water Resources (much like the Whale Rock
Commission). Although there are many details that would have to be worked out in the formation of
such an authority, there appears to be some support for such an organization because it allows affected
agencies input in the operations of the reservoir.
County Ownership
The third alternative would be for the City to support the County's acquisition of the facility. This is
probably the most expeditious alternative for achieving the transfer of ownership and moving forward on
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COUNCIL AGENDA REPORT
Salinas Reservoir Ownership
Page 5
the reservoir expansion project. There would be many conditions which would need to be worked out
to insure that the City's input concerning budgets and operations of the facilities are addressed. City
staffs main concerns center around water quality at the reservoir and efficient operations.
No Ownership Transfer
The last alternative is to do nothing regarding the transfer of ownership.. This would put the Salinas
Reservoir Expansion Project on hold until a later date when the transfer of ownership could be mutually
agreed upon by the City and County. The ACOE could dispose of the facility through the military
surplus procedures and an agency or individual other than the City or County could receive ownership.
This is not a likely situation but is a possibility. Since the ACOE has been extremely interested for many
years in transferring the ownership of this facility to a local agency, staff recommends that one of the
other alternatives be pursued.
Summary
Based on all the information presented above, there are two readily viable alternatives concerning transfer
of ownership to a local agency if the Council desires to keep the expansion project moving forward. The
JPA or County ownership options would appear to be the preferred alternatives. Of these two
alternatives, staff would recommend supporting County ownership with the condition that an agreement
can be worked out with the County to protect the City's interests as outlined in the report. This would
be the most expedient alternative and with sufficient conditions in an agreement, would still allow City
input concerning operations at the reservoir.
FISCAL EWPACT
There is no immediate fiscal impact, although depending on the outcome of discussions concerning
ownership transfer, significant expenditures may be expected in the future to accomplish the transfer.
The least expensive alternative regarding the ACOE procedural requirements would be to pursue special
legislation. The other two options may require the purchase of the property and facilities along with the
costs associated with the studies and surveys.
Attachment: 1. Preliminary Cost Estimates for Salinas Reservoir Property Transfer
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10-09-1992 17:34 b0° 1 0259 WOODWARD—CLY ONSULTANTS P.02
Woodward-Clyde Attachment A
Consultants
EnplrioArg a&saws aWbd t0 to earth a lit omkanmanl
October 9, 1992
Project No,'91613131B
Mr. Gary Henderson
Water Division Manager
City of San Luis Obispo
955 Morro Street
San Luis Obispo, California 93401
Subject: Preliminary Cost Estimates for Salinas Reservoir Property Transfer
Dear Mr. Henderson:
As per your telephone conversation with Keith Julian on September 28, 1992, this letter
presents a rough preliminary estimate (i.e., "ballpark" figuies) of costs that may be
incurred during the transfer of Salinas Reservoir and the surrounding property
(approximately 4;400 acres) from ownership of the Department of the Army to an as yet
unidentified local agency. Woodward-Clyde Consultants (WCC) is providing the
following estimates based on limited information provided by the administrators of the
property, the United States Army Corps of Engineers (ACOS), as well as a set of
assumptions regarding the ultimate timing and disposition of the property.
WCC assumes that the recipient of the property will be an entity similar to a joint
Powers Agency (JPA) to which, at a minimum, the City of San Luis Obispo and the
County of San Luis Obispo will be party. During the formulation of estimates of
expenses that might be associated with the transfer of property (in addition to
City/County staff time),WCC assumed that the transfer would be accomplished through
special "permissive legislation" or through disposal procedures as allowed in the Base
Closure Act of 1990 (as amended 1991). It is assumed that environmental review of the
transfer would be conducted under the guidelines of the National Environmental Polity
Act (NEPA), and that the transfer would not requireseparate review under the
California Environmental Quality Act (CEQA).
The cost-incurring activities associated with the property transfer are anticipated to
include:
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10-09-1992 17:35 SOS 9e4 0259 WOODWARD-CLYDE _�NSULTANTS P103
Woodward-Clyde
Consultants
Mr. Gary Henderson
City of San Luis Obispo
October S, 1992
Page 2
NEPA Environmental Review
• Real Estate Transfer
Boundary Line Delineation
Hazardous Materials Clearance
• Cultural Resources Review
Special Legislation Assistance
NEPA ENVIRONMENTAL REVIEW
Environmental review would include, but not necessarily be limited to, the preparation
of a focused NEPA Environmental Assessment(EA). Potential impacts that might result
from the transfer of the property would be documented and evaluated in accordance
with NEPA standards and the Council on Environmental Quality(CEQ)guidelines. The
ACOS would be the Lead Agency for NEPA compliance. It is anticipated that the E4
would be prepared for the ACOE by the property recipient and/or their consultant.
Should a full NEPA Environmental Impact Statement be required, the cost could easily
run to three times the amount required for an EA.
Preliminary Cost Estimate: $80,000 (EA) or $240,000 (EIS)
Assumptions: If an EA is required, information for impact identification and analysis
would be based on previous fieldwork, no additional field data gathering would be
necessary, and no unrnitigable significant impacts would result from the transfer. If an
EIS is required, litaited field work would be necessary on the entire 4400 acre site.
REAL ESTATE TRANSFER COSTS
Real estate transfer fees would be assessed by the ACOS and could include,but not be
limited to, preparation of maps, deeds and supporting documents, coordination with the
ACOE Cadastral Survey and expenses related to coordination meeting&with the property
recipient.
Preliminary Cost Estimate: $40,000
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10-09-1992 17:35 . 805 1 0259 WOODWARD-CLVL ONSULTANTS P.04
Woodward-Clyde
Consultants
Mr. Gary Henderson
Ciry of San Luis Obispo
October 5, 1992
Page 3
Assumptions: Transfer is non-controversial and receives prompt review and signature
by the Secretary of the Army. It is assumed that no actual land value costs would be
incurred by the JPA in obtaining the property.
BOUNDARY LINE DELINTATION
Boundary line surveys would be required by the ACOS and would need to be performed
by qualified surveyors (i.e., to be selected by the recipient). Tie following preliminary
cost estimate was based on comparable surveys in areas with similar terrain, vegetation
and difficulty of access.
Preliminary Cost Estimate: $250,000
Assumptions: The survey estimates are made assuming a total property boundary
perimeter length of 25 miles at a cost of approximately 510,000 per mile, and assuming
that adequate United States Coast and Geodetic survey monument markers are
available.
HAZARDOUS MATERIALS CLEARANCE
A hazardous materials evaluation would be performed by qualified professionals selected
by the recipient. This evaluation would include, but not be limited to: site history
review, photo documentation, on-site reconnaissance survey, historic
map/photo/document review, sad agency records review.
Preliminary Cost Estimate: 525,000
Assumptions: No hazardous materials clean-up or mitigation would be necessary. A
typical real estate Phase I Preliminary Site Assessment (PSA) standard of performance
would be expected to satisfy ACOE/NEPA requirements.
CULTURAL RESOURCES REVIEW
Required review of the undertaking (transfer) for potential effects on cultural resources
would have to be accomplished pursuant to Section 106 of the National Historic
Preservation Act and Implementing Regulations (36 CFR 800). This review could be
accomplished by qualified professionals selected by the recipient (JPA) working in
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10-09-1992 17:36 605 9b4 0259 WOODWARD—CLYDE .. )NSULTANTS P.OS
Woodward-Clyde
Consultants
Mr. Gary Henderson
City of San Luis Obispo
October 5, 1992
Page 4
conjunction with ACOS cultural resources staff. Under certain conditions (which seem
reasonable at this time) Section 106 compliance for the transfer could be accomplished
through the formulation of a Programmatic Agreement (PA) among the ACOS, State
Historic Preservation Officer (SETO), Advisory Council on Historic Preservation
(ACNP), and the recipient,
Preliminary Cost Estimate: $30,000
Assumptions: The basic assumption is that a PA would be sufficient to satisfy Section
106; this would mean that Iand use following the transfer would not be changed, and no
additional fieldwork and/or mitigation related to cultural resources would be necessary.
SPECIAL LEGISLATION ASSISTANCE
It is expected that the proposed recipient of the property would need assistance in the
formulation and execution of a strategy for initiating the special"permissive legislation"
that would allow the Department of the Army to transfer ownership of the property
outside of normal property disposal procedures. Assistance would include, but not be
limited to, coordination and participation in meetings with representatives of the
Department of the Army, regulatory agencies, and legislators at the federal level.
Preliminary Cost Estimate: $45,000
Assumptions: In addition to formulation of strategy, consultant services would include
up to four meetings with the City/County; up to three meetings with the ACOS in Los
Angeles; and up to three meetings with legislators (including several trips to Washington,
D.C:). It is assumed that up to 350 hours of senior level personnel time (i.e., consultants
and/or attorneys). could be required, plus up to 57,000 in travel expenses. With "worst
case" assumptions, the costs could be much higher (e.g., easily double). Note: These
costs do ml include WCC's out of scope services already performed to date on this task.
SUMMARY
The preliminary cost estimates prepared by WCC based on our discussions with the
ACOS and the assumptions listed herein are summarized as follows.
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10-09-1992 17:36 805 1 0259 WOODWARD-CLVL ONSULTANTS P.06
Woodward-Clyde
Consultants
Mr. Gary Henderson
City of San Luis Obispo
October 5, 1992
Page 5
Preliminary
ink Cost Estimate (S)
Environmental Review $ 80,000 (EA)
or
$240,000 (FIS)
Real Estate Transfer 40,000
Boundary Line Delineation 250,000
Hazardous Materials Clearance 251000
Cultural Resources Review 30,000
Special Legislation Assistance . 459000
TOTAL 5 470,000 to $630,000
Please note that these costs are based on the listed assumption; if a %vorst case" set of
assumptions are applied, total costs could easily double.
Please call the undersigned if you have any questions or comments.
Sincerely,
&,�' —
Robert Ray Stephen hen Glass
Project Manager Task Manager
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