Community Member Industry Vendor

Frequently Asked Questions

Q – The Los Osos treatment plant is operating way below capacity. Will the City’s WRF be too big?
A – The Draft Facility Master Plan reviewed decades of flow records. The recommended design flow for the WRF was developed by using the historical average wastewater flows from the City between 2002 and 2014, and a 0.62% projected growth rate, estimating a buildout population of 12,000 in 2040 consistent with the preliminary analysis for the City’s General Plan Update. Flows from Cayucos Sanitary District were subtracted so the new plant would not be oversized.

Although there has been a downward trend in wastewater flows over the past five years, the State has been in an extended drought, which correlates to the decreased flows observed during that period. The City’s water conservation program has been highly successful but will not reduce water demand much further and it is not safe to design a wastewater treatment plant assuming these lowest historical demands will continue for the next 30 years.  Wet weather events significantly increase wastewater flows at the plant due to inflow and infiltration (I&I) of rainfall into the sewer collection system. The City is committed to continuing testing and repair to reduce I&I, however this is a lengthy and costly task, and can take decades. Therefore, the City cannot simply review flows from the most recent dry years, but must account for wet weather when designing the treatment plant.

Q – When will the project be completed?
A – The WRF Project, including construction, is scheduled to be completed in late 2021. This will include a lift station, pipelines, and full advanced treatment to produce water fit for supplementing the City’s potable groundwater supply. Plant testing will continue into early 2022.

Q – How much will the project cost?
A – The most recent opinion of cost for the WRF with full recycling at the South Bay Boulevard site is $150.7M. The Draft Facility Master Plan and Draft Master Water Reclamation Plan were completed in early 2017. After those documents were completed, the recommended project, which included all construction costs for treatment and groundwater recharge and all soft costs (design, permitting, and contingencies) was estimated at $167M. After the costs for the recommended project were presented at the July 11, 2017 City Council Meeting, staff was directed to investigate ways to review costs and to conduct a peer review panel. The panel recommended several project refinements early in this planning process, including odor control and layout revisions that resulted in lowering the anticipated project cost. However, the actual project cost will be a function of the outcome of the bidding among the qualified short-listed design-build firms competing for the project.  By structuring this as a competitive bid approach, the City can ensure the project is as affordable as possible.

Q – How will the City pay for the project?
A – The project will be financed through a variety of sources. The City is pursuing grants and loans through the State Water Resources Control Board (SWRCB) and other state and federal agencies to help fund the project. The SWRCB awarded the City a Recycled Water Planning Feasibility Study Grant for $75,000 and a Clean Water State Revolving Fund (SRF) Planning and Design Loan for $10.3M.

Kestrel Consulting is identifying additional grant and loan opportunities and leading the City’s strategy to secure funding from the programs that best fit the City’s project. A grant from the Bureau of Reclamation WaterSmart program is also being pursued. It is a competitive program that could fund up to $20M for the City’s project if awarded. Both the SWRCB Clean Water SRF and the EPA Water Infrastructure Financing and Investment Act (WIFIA) loan programs are being pursued for construction. The City submitted a letter of interest to the EPA regarding WIFIA financing in April 2017 and was selected along with 11 other prospective projects around the nation from a group of 43 interested entities to apply for WIFIA financing, which will fund up to 49% of the total project costs. The City has been in regular contact with SWRCB financing staff regarding a potential SRF construction loan. The SWRCB also has a loan forgiveness program for water recycling projects and “green projects”. Water recycling projects can receive a maximum of $2.5 million in loan forgiveness and “green projects” can receive a maximum of $4 million, including the $2.5 million from water recycling.

Any loans will need to be repaid through user rates. New wastewater rates went into effect on July 2015 to help fund the first phase of the project.  A second rate increase will be needed to help fund the remainder. The updated draft Rate Study is anticipated to be completed May 2018, which will review opportunities to lower required rates, including available money within the existing rate structure, alternative financing options, and payment collection strategies.

Q – How much will the project affect user rates?
A –Following completion of the Draft Facility Master Plan and Draft Master Water Reclamation Plan, the City’s rate consultant prepared the “Draft Sewer and Water Financial Plan for the City of Morro Bay” (April 2017) which considered two alternatives: secondary treatment for ocean discharge or a full recycled water project. The maximum combined water and sewer bill for the project without recycling (secondary treatment only with discharge to the ocean) was estimated to be $207, and the maximum combined rate for the full recycled water project was estimated at $241.

Project costs have been refined since the draft rate study was prepared, and a competitive bid process among qualified design firms could lower the anticipated cost further. The City will be considering an updated rate study in May after proposals are received from contractors for design and construction of the WRF onsite improvements (including all the work within the South Bay Boulevard site to treat wastewater). It is anticipated that rates will likely be lower than the values estimated in April 2017, due to refinement of capital costs in recent months.

The City will pass a “maximum allowable” rate increase, but will not increase rates to that maximum amount if they can achieve lower construction and operating costs.

Q – Would it be less expensive to be a customer of Cayucos Sanitary District at their facility?
A – Partnering with CSD is not anticipated to provide economic benefit to the City. A new WRF at the Toro Creek site was considered for both becoming a customer of the CSD and constructing an adjacent, stand-alone facility at the Toro Creek site to serve the City. Based on cost estimates in the Draft Facility Master Plan for a new joint facility between the City and CSD, the City will likely see no financial benefit by becoming a customer of the CSD if the new facility is built at the Toro Creek site, especially due to the fact that the City would be pursuing advanced treatment and a recycled water project without the CSD. In addition, building a new facility at the Toro Creek site to serve the City would not provide economic benefit as the site is further from the City than the SBB site and elevations are higher along the pipeline route, requiring more cost to pump wastewater.

Q – Where will the new facility be located?
A –The proposed site for the new facility is near the South Bay Boulevard exit from Highway 1. The City and property owner have executed a Memorandum of Understanding for future purchase of part of the property after the Final Environmental Impact Report is certified.

Q – Can we recycle wastewater if we build the WRF at South Bay Blvd?
A –Yes. One of the advantages of the South Bay Boulevard site, from a long-term prospective, is the proximity between the City’s two groundwater basins (Chorro Valley and Morro Valley) allowing flexibility for future reuse within either or both basins. To maximize the potential water supply benefit, the Draft Master Water Reclamation Plan recommends injecting recycled water into the Morro Valley groundwater basin upstream of the City’s water production wells.

Q – How many gallons of recycled water will be reclaimed per year at the new WRF, once reclamation is fully implemented?
A – The City’s goal is to recycle as much water as possible. Preliminary estimates of recycled water production from the Draft Facility Master Plan and Draft Master Water Reclamation Plan indicate that roughly 0.74 MGD (825 acre feet/year) could be produced, about 76% of the WRF’s average daily flow design capacity (0.97 MGD). Planning-level groundwater modeling results indicate that all recycled water could be used for groundwater injection and extraction in the Morro Valley, a substantial water supply benefit.

Q – Santa Paula and Fillmore completed their water reclamation facilities in less than 5 years. Why is this one requiring 5 years?
A – The City’s 5-year goal includes all the planning, permitting, financing, design, construction, and commissioning for the project after site selection. Construction for the Santa Paula and Fillmore Water Reclamation Facility projects was completed approximately 2 to 2½ years after the construction contracts were approved. However, the master planning, permitting, CEQA compliance, and other efforts took several years prior to the approval of the construction contracts.  Morro Bay’s 5-year goal includes all these activities beginning June 14, 2016, when Council selected the South Bay Boulevard site as the preferred location for planning and permitting.

The City of Santa Paula completed a project report that identified treatment technologies for their WRF in 2003.  Preliminary cost opinions were developed in Spring 2005.  The Final Environmental Impact Report (FEIR) was certified in April 2005, and construction of the WRF was completed in May 2010.

The City of Fillmore developed a Project Report with an initial program budget in 2004, then began work on the Environmental Impact Report.  The design-build-operate-finance team began design and construction in November 2006, and the WRF was completed and operational in August 2009.

Q – What is the “Basis of Costs” for the cost opinions?  Why don’t we have detailed estimates of the hours and hourly rates for every future consultant and contractor that would be involved with the City’s WRF?
A – Black and Veatch developed construction cost, design cost opinions, and contingencies for the influent lift station, raw wastewater pipeline, brine/wet weather discharge pipeline, decommissioning of the existing wastewater treatment plant, and WRF itself including fully advanced treatment for groundwater injection (see Facility Master Plan).  The cost basis for these estimates is based on their experience and expertise designing similar projects throughout the country, including the most up-to-date unit costs for key project components.

MKN developed construction cost, design cost opinions and contingencies for recycled water project alternatives including recycled water pump station, pipelines, and injection wells (see Master Water Reclamation Plan). MKN also developed cost opinions for design, project administration, construction management, procurement, preliminary studies, and contingencies for the following:

  • Project administration (program management, City staff involvement, and outreach);
  • Procurement and preliminary studies (Facility Master Plan, Master Water Reclamation Plan, hydrogeology studies, surveying, groundwater modeling, effluent discharge alternatives, and early 2013-2015 siting studies);
  • Permitting, monitoring, and mitigation (Environmental Impact Report, cultural studies, biological studies, completion of County/City/state permit applications, permit fees, and monitoring of any sensitive habitat or cultural resources)
  • Property acquisition
  • Recycled water pipeline, storage, and injection wells

For many of these items, typical percentages of construction cost were applied to develop estimates (see tables in previous question).  This is an appropriate and common approach to developing project budgets during the master planning phase of a project.  These estimates were reviewed by engineers and design professionals with appropriate expertise, including Black & Veatch engineering staff and City Public Works staff.  The project components that formed the basis of this estimate were also considered by the WRFCAC and its engineering subcommittee.

Staff will continue refining the detailed budget for all the different studies and contracts required.  Each of these efforts will require a detailed proposal or bid from the contractors or consultants.  Hourly rates and estimated hours will be submitted by the proposers for consideration by the City.  Rates and hours can vary depending on how the proposer approaches the work and the type of staff they use to perform the work.  City staff will negotiate contracts, including scopes, budgets, and schedules, to sufficient detail to allow us to track progress of the work and to ensure the City is being charged fairly for the work.  All existing City consultants and contractors under the WRF program have detailed scopes, budgets, and schedules incorporated in their executed agreements.  These are all tracked using the City’s Procore project management software.

A peer review panel of local public works officials was convened in 2017 to review the project.  They provided recommendations that confirmed and refined the cost opinions and were incorporated into the overall cost opinions moving forward.

Q – There are members of the community who want to investigate building a “hardened” WRF on property adjacent to the current WWTP.  Does Coastal Commission (CCC) staff believe such an approach is supportable?



A – The property adjacent to the WWTP is within the floodplain and the tsunami inundation zone similar to constraints to building a new WRF at the existing site.  Based on recent and ongoing discussions between City and CCC staff, there is no support from CCC staff for pursuing a new WRF adjacent to the current WWTP site, because it is inconsistent with previous CCC direction to move the facility farther from the coast to better implement relevant Coastal Act policies.  Coastal Commission staff expressed support for moving the project forward at the South Bay Boulevard site instead, and also submitted a letter confirming this approach prior to the September 2017 City Council decision confirming the South Bay Boulevard site.

Q – The primary collection point for the City’s wastewater system will necessarily be at a low elevation that will likely be in the 100-year floodplain.  What special conditions can the City anticipate from California Coastal Commission (CCC) to allow a lift station to be built within the 100-year floodplain?
A – City staff and consultants have been engaged in ongoing discussions with CCC about the new lift station.  CCC will require an alternatives evaluation and justification for constructing a new lift station near the existing WWTP site.  That evaluation can be accomplished in the context of the EIR for the project.  The City’s sewage collection system drains to the existing WWTP from multiple directions. The existing WWTP lies within a floodplain. With construction of the WRF at a new location, the City’s collection system will need to be modified to flow to the new WRF. Rerouting the existing collection system to drain to the new location would involve considerable design and permitting and would significantly increase overall project costs.  Instead, a lift station at or near the existing WWTP is proposed to receive the City’s sewage and pump it to the new WRF.  The lift station will be designed with flood proofing measures, including submersible pumps that continually operate underwater. Structures will be set two feet above the 100-year flood elevation. The electrical panels will also be located at an elevation to avoid flooding and conduits will be sealed.

Q – Will the project be required to comply with the CEQA environmental review process?
A – Yes. In addition, the project will be required to comply with requirements of the National Environmental Policy Act (NEPA) in order to receive state and federal funding for parts of the project. NEPA compliance must be consistent with the requirements of the various federal agencies that may provide funding for part of the project.

Q – What permits will be required for the project?
A – The complete permit list will be developed during the CEQA environmental review process and ongoing work by the Program Management Team and our CEQA/NEPA consultant, ESA.

Q – Will the project have environmental impacts?
A – The project is intended to accomplish two primary tasks:
1)  Improve water quality by improving the level of treatment of wastewater, and
2)  Enhance water supply by producing recycled water.
While some temporary construction-related impacts are expected as a result of constructing the new WRF and related facilities, these impacts will be identified and mitigation measures will be developed through the CEQA compliance process, to be reported in an Environmental Impact Report (EIR). This is a process that encourages public review and input, and involves many agencies and stakeholders. Public hearings and opportunities for comment will continue through into 2018.

Q – What will happen to the old wastewater treatment plant (WWTP)?
A – The old WWTP will be taken out of service after the new WRF is constructed, commissioned, and ready to reliably produce treated effluent.

Q – What will the old WWTP site be used for after demolition?
A – The City will determine this through other planning efforts, beginning with an update of the General Plan and Local Coastal Plan. The cost opinions for demolishing the existing site will be developed assuming all materials will be removed to several feet below grade, and the clean site will be ready for a wide variety of potential uses.

Q – How can I receive community email notifications about the project?
A – Sign up through this website by clicking here.

Q – Who can I contact with comments or questions about the project?
A – Send us your questions and comments here.

Contact Info

John Rickenbach
WRF Deputy Program Manager
595 Harbor Street
Morro Bay, CA 93442

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    The City is hosting a public forum at the Veterans Memorial Hall on April 25, 2018 at 6:30 PM. Learn more and download a comment card in the flyer.