LAFCO
—Comprehensive Sanitation Service & Sphere Review (February 2026)
Read the report at Local Agency Formation Commissions ↗
Loca l Agency Formation Commission
of Santa Cruz County
Comprehensive Sanitation
Service and Sphere Review:
• BEAR CREEK ESTATES WASTEWATER SYSTEM
• COUNTY SERVICE AREAS – 2, 5, 7, 10, AND 20
• DAVENPORT COUNTY SANITATION DISTRICT
• FREEDOM COUNTY SANITATION DISTRICT
• SALSIPUEDES SANITARY DISTRICT
• SANTA CRUZ COUNTY SANITATION DISTRICT
Adopted Version – February 4, 2026
Table of Contents
EXECUTIVE SUMMARY ....................................................................................................................... 4
Introduction ........................................................................................................................................ 4
Structure of Report ............................................................................................................................. 4
Service Provision ............................................................................................................................... 4
Sphere of Influence .......................................................................................................................... 14
Key Findings .................................................................................................................................... 16
Recommended Actions .................................................................................................................... 17
BEAR CREEK ESTATES WASTEWATER SYSTEM ......................................................................... 18
District Overview .............................................................................................................................. 18
Finances ........................................................................................................................................... 21
Governance ..................................................................................................................................... 24
Opportunities & Challenges ............................................................................................................. 26
Sphere of Influence .......................................................................................................................... 26
District Summary .............................................................................................................................. 28
Service and Sphere Review Determinations ................................................................................... 29
COUNTY SERVICE AREA 2 (PLACE DE MER)................................................................................ 31
District Overview .............................................................................................................................. 31
Finances ........................................................................................................................................... 34
Governance ..................................................................................................................................... 38
Opportunities & Challenges ............................................................................................................. 40
Sphere of Influence .......................................................................................................................... 41
District Summary .............................................................................................................................. 43
Service and Sphere Review Determinations ................................................................................... 44
COUNTY SERVICE AREA 5 (SAND DOLLAR/CANON DEL SOL) .................................................. 46
District Overview .............................................................................................................................. 46
Finances ........................................................................................................................................... 50
Governance ..................................................................................................................................... 53
Opportunities & Challenges ............................................................................................................. 55
Sphere of Influence .......................................................................................................................... 56
District Summary .............................................................................................................................. 58
Service and Sphere Review Determinations ................................................................................... 59
COUNTY SERVICE AREA 7 (BOULDER CREEK) ........................................................................... 61
District Overview .............................................................................................................................. 61
Finances ........................................................................................................................................... 66
Governance ..................................................................................................................................... 69
Opportunities & Challenges ............................................................................................................. 71
Sphere of Influence .......................................................................................................................... 72
District Summary .............................................................................................................................. 75
Service and Sphere Review Determinations ................................................................................... 76
Comprehensive Sanitation Service and Sphere Review Page 1 of 177
COUNTY SERVICE AREA 10 (ROLLING WOODS/GRAHAM HILL) ................................................ 78
District Overview .............................................................................................................................. 78
Finances ........................................................................................................................................... 83
Governance ..................................................................................................................................... 86
Opportunities & Challenges ............................................................................................................. 88
Sphere of Influence .......................................................................................................................... 89
District Summary .............................................................................................................................. 91
Service and Sphere Review Determinations ................................................................................... 92
COUNTY SERVICE AREA 20 (TRESTLE BEACH) ........................................................................... 94
District Overview .............................................................................................................................. 94
Finances ........................................................................................................................................... 97
Governance ................................................................................................................................... 100
Opportunities & Challenges ........................................................................................................... 102
Sphere of Influence ........................................................................................................................ 103
District Summary ............................................................................................................................ 105
Service and Sphere Review Determinations ................................................................................. 106
DAVENPORT COUNTY SANITATION DISTRICT ............................................................................ 108
District Overview ............................................................................................................................ 108
Finances ......................................................................................................................................... 113
Governance ................................................................................................................................... 116
Opportunities & Challenges ........................................................................................................... 118
Sphere of Influence ........................................................................................................................ 119
District Summary ............................................................................................................................ 122
Service and Sphere Review Determinations ................................................................................. 123
FREEDOM COUNTY SANITATION DISTRICT ................................................................................ 125
District Overview ............................................................................................................................ 125
Finances ......................................................................................................................................... 130
Governance ................................................................................................................................... 134
Opportunities & Challenges ........................................................................................................... 136
Sphere of Influence ........................................................................................................................ 137
District Summary ............................................................................................................................ 139
Service and Sphere Review Determinations ................................................................................. 140
SALSIPUEDES SANITARY DISTRICT ............................................................................................. 142
District Overview ............................................................................................................................ 142
Finances ......................................................................................................................................... 147
Governance ................................................................................................................................... 151
Opportunities & Challenges ........................................................................................................... 153
Sphere of Influence ........................................................................................................................ 153
District Summary ............................................................................................................................ 156
Service and Sphere Review Determinations ................................................................................. 157
Comprehensive Sanitation Service and Sphere Review Page 2 of 177
SANTA CRUZ COUNTY SANITATION DISTRICT ........................................................................... 159
District Overview ............................................................................................................................ 159
Finances ......................................................................................................................................... 165
Governance ................................................................................................................................... 168
Opportunities & Challenges ........................................................................................................... 170
Sphere of Influence ........................................................................................................................ 171
District Summary ............................................................................................................................ 174
Service and Sphere Review Determinations ................................................................................. 175
APPENDICES .................................................................................................................................... 177
A. Bear Creek Estates Wastewater System – Formation Document ..................................... 177
B. CSA 2 (Place de Mer) – Formation Resolution .................................................................. 177
C. CSA 5 (Sand Dollar/Canon del Sol) – Formation Resolution ............................................. 177
D. CSA 7 (Boulder Creek) – Formation Resolution ................................................................ 177
E. CSA 7 (Zone 2) – Formation Resolution ............................................................................ 177
F. CSA 10 (Rolling Woods/Graham Hill) – Formation Resolution .......................................... 177
G. CSA 20 (Trestle Beach) – Formation Resolution ............................................................... 177
H. Davenport County Sanitation District – Formation Resolution ........................................... 177
I. Freedom County Sanitation District – Formation Resolution ............................................. 177
J. Salsipuedes Sanitary District – Formation Resolution ....................................................... 177
K. Santa Cruz County Sanitation District – Formation Resolution ......................................... 177
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EXECUTIVE SUMMARY
Introduction
This Service and Sphere of Influence Review provides information about the services and
boundaries of 10 sanitation districts located throughout Santa Cruz County. The purpose
of the report is to allow the Local Agency Formation Commission to conduct a statutorily
required review and update process. The Cortese-Knox-Hertzberg Act requires that the
Commission conduct periodic reviews and updates of spheres of influence for all cities
and special districts, including county service areas (CSAs), in Santa Cruz County
(Government Code section 56425). It also requires LAFCO to conduct a review of
municipal services before adopting Sphere updates (Government Code section 56430).
The last countywide sewer analysis conducted for the 10 sanitation districts occurred on
October 2, 2019.
The municipal service review process does not require LAFCO to initiate changes of
organization based on service review conclusions or findings; it only requires that LAFCO
make determinations regarding the delivery of public services in accordance to the
provisions of Government Code Section 56430. However, LAFCO, local agencies, and
the public may subsequently use the determinations and related analysis to consider
whether to pursue changes to service delivery, government organization, or spheres of
influence.
Service reviews are informational documents which are generally exempt from
environmental review. LAFCO staff has conducted an environmental evaluation for this
report pursuant to the California Environmental Quality Act (CEQA) and determined that
this report is exempt from CEQA. Such exemption is due to the fact that it can be seen
with certainty that there is no possibility that the activity in question may have a significant
effect on the environment (Section 15061[b][3]).
Structure of Report
This Executive Summary presents a brief overview of the service review, key findings,
and recommended actions. The District Profile chapters contain individual evaluations
for each of the 10 sanitation districts - highlighting specific characteristics, ongoing
operations, current fiscal health, existing governance structure, ability to provide services,
and its importance within its jurisdictional area. The profiles conclude with statutory
determinations required for all service and sphere of influence reviews pursuant to the
Cortese-Knox-Hertzberg Act. These chapters are followed by Appendices with sources
used to conduct the service review.
Service Provision
Wastewater services within Santa Cruz County are provided by nine dependent special
districts, three cities, and two independent special districts. Facilities range from individual
or small community septic systems to local wastewater collection systems and regional
treatment plants. Wastewater systems are closely regulated both for health and
environmental concerns. The Regional Water Quality Control Board regulates operations
and discharges from sewage systems.
In accordance to the Commission’s Multi-Year Work Program adopted in 2024, the
following 10 sanitation districts will be analyzed in this report. Figure 1 on page 6 provides
an overview map depicting the 10 subject agencies.
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List of Subject Agencies:
1. Bear Creek Estates Wastewater System (San Lorenzo Valley Water District)
2. County Service Area 2 (Place de Mer)
3. County Service Area 5 (Sand Dollar/Canon del Sol)
4. County Service Area 7 (Boulder Creek Country Club)
5. County Service Area 10 (Rolling Woods)
6. County Service Area 20 (Trestle Beach)
7. Davenport County Sanitation District
8. Freedom County Sanitation District
9. Salsipuedes Sanitary District
10. Santa Cruz County Sanitation District
CSA 12 (Wastewater Management) and the Cities of Santa Cruz, Scotts Valley, and
Watsonville were analyzed in the previous service review cycle and are excluded from
this 2025 report. LAFCO’s website contains the service reviews for these four additional
wastewater providers: https://www.santacruzlafco.org/reviews/.
Regulatory Requirements
All federal and state agencies, municipalities, counties, districts, and other public entities
that own or operate sanitary sewer systems greater than one mile in length, that collect
and/or convey untreated or partially treated wastewater to a publicly owned treatment
facility in the State of California, are required to comply with the terms of the State Water
Resources Control Board’s Statewide Sanitary Sewer Systems General Order. In 2023,
the State Water Resources Control Board (State Water Board) adopted the existing
Statewide Sanitary Sewer System Order. Through this General Order, the State Water
Board began regulating the sanitary sewer systems designed to convey sewage. This
General Order establishes statewide waste discharge requirements and supersedes the
previous State Water Resources Control Board (State Water Board) Order from 2006 and
amendments thereafter. All sections and attachments of the latest General Order are
enforceable by the State Water Board and Regional Water Quality Control Boards
(Regional Water Boards). Through this General Order, the State Water Board requires
an Enrollee to:
• Comply with federal and state prohibitions of discharge of sewage to waters of the
State, including federal waters of the United States;
• Comply with the specifications, and notification, monitoring, reporting and
recordkeeping requirements of this General Order that relate to implementation of the
federal Clean Water Act, the California Water Code (Water Code), water quality
control plans (including Regional Water Board Basin Plans) and policies;
• Proactively operate and maintain resilient sanitary sewer systems to prevent spills;
• Eliminate discharges of sewage to waters of the State through effective
implementation of a Sewer System Management Plan;
• Monitor, track, and analyze spills for ongoing system-specific performance
improvements; and
• Report noncompliance with this General Order per reporting requirements.
Comprehensive Sanitation Service and Sphere Review Page 5 of 177
Figure 1: Countywide Map (10 Sanitation Districts)
Comprehensive Sanitation Service and Sphere Review Page 6 of 177
Growth and Population
The Association of Monterey Bay Area Governments (AMBAG) indicates that the
unincorporated areas within Santa Cruz County will experience a slow growth over the
next fifteen years. The 2018 AMBAG Regional Growth Forecast Report states that the
population in unincorporated territory will grow at a rate of approximately 1% every five
years. Based on this anticipated growth rate, LAFCO staff calculated the estimated
population for each subject agency from 2025 to 2040, as shown below. These growth
projections are using LAFCO’s methodology and may differ from projections based on
regional housing needs:
Table 1: Population Estimates
Sanitation District 2025 2030 2035 2040
Bear Creek Estates Wastewater System 186 188 189 191
CSA 2 (Place de Mer) 169 171 172 174
CSA 5 (Sand Dollar/Canon del Sol) 222 224 226 228
CSA 7 (Boulder Creek Country Club) 662 668 674 679
CSA 10 (Rolling Woods) 897 904 912 920
CSA 20 (Trestle Beach) 43 43 44 44
Davenport County Sanitation District 219 221 223 225
Freedom County Sanitation District 4,200 4,272 4,308 4,345
Salsipuedes Sanitary District 2,172 2,190 2,209 2,228
Santa Cruz County Sanitation District 73,894 74,756 75,628 76,510
Total Population Within the 10 Sewer Districts 82,664 83,637 84,585 85,544
Population growth will continue to affect the agencies providing wastewater services as
they upgrade their systems to comply with regulatory changes and maintain service
levels. In general, CSAs, small package treatment plants, and their wastewater disposal
systems may not be an efficient method of providing wastewater service for the rural
areas of the County due to three primary factors: (1) the rising costs of addressing aging
infrastructure, (2) the lack of revenue streams to cover current and long-term liabilities,
and (3) the reliability offered by larger agencies with established treatment plants. Based
on the findings discussed in this report, all future dense developments should consider
connecting to existing wastewater facilities rather than establishing small, limited sewer
collection systems.
Comprehensive Sanitation Service and Sphere Review Page 7 of 177
Disadvantaged Unincorporated Communities
In accordance to Senate Bill 244, which became effective on January 1, 2012, state law
requires the identification and description of all “disadvantaged unincorporated
communities” (DUCs) located within or contiguous to the existing spheres of influence of
cities and special districts which provide fire protection, sewer, and/or water services
(Government Code Section 56046). DUCs are defined as inhabited unincorporated areas
with an annual median household income that is 80% or less than the statewide annual
median household income. The identified disadvantaged unincorporated communities
must be addressed by LAFCO when:
• Considering a city annexation proposal involving 10 or more acres with an existing
DUC located contiguous to the proposal area; and
• Approving sphere of influence and municipal service review determinations
associated with the update or establishment of spheres of influence for local agencies
subject to SB 244 requirements.
In 2025, the California statewide annual median household income was $109,2661, and
80% of that is $87,413. LAFCO staff utilized the ArcGIS mapping program to locate
potential DUCs in Santa Cruz County. Staff’s analysis initially found two areas that may
be considered DUCs in the Twin Lakes and Freedom area, as shown in Figure 2. Based
on the criteria set forth by SB 244, in conjunction with further evaluation of these areas,
staff determined that these areas are not disadvantaged unincorporated communities
since the land use designation for the DUC in Freedom is for agriculture and the land use
designation for the DUC in Twin Lakes is for mixed-use which includes both high-valued
homes and commercial properties.
Figure 2: Disadvantaged Unincorporated Communities in Santa Cruz County
1 2019-2023 U.S. Census Bureau's American Community Survey (ACS) 2019-2023 5-year estimates
Comprehensive Sanitation Service and Sphere Review Page 8 of 177
Infrastructure Components
Wastewater infrastructure includes septic systems, collection and sewer main lines, lift
stations, treatment plants and recycled water treatment systems. The geography of the
local area, water quality conditions, accessibility of treatment facilities, and funding
considerations are factors in determining the type of system used and its infrastructure
needs. Parcels that are not in proximity to a public sewer system and meet certain
requirements may use individual septic systems; some geographically isolated
communities share a community septic system or use an onsite package treatment plant.
Developed areas are served by collection systems with treatment provided at local or
regional facilities. One treatment plant, operated by the Davenport County Sanitation
District, is currently producing recycled water.
The following table summarizes the wastewater infrastructure for the 10 sanitation
districts:
Table 2: Wastewater Infrastructure Summary
Sanitation Formation Type of Treatment No. of No. of Lift Miles of
District Year System Level Connections Stations Sewer Line
Bear Creek Septic and
1985 N/A 56 2 1.2
Estates Collection System
Collection and
CSA 2 1968 Advanced N/A 93 2 0.4
Treatment
Collection and
CSA 5 1972 Secondary 184 2 1.15
Treatment
Collection and Zone 1: 254
CSA 7 1968 Secondary 6 3.4
Treatment Zone 2: 12
CSA 10 1970 Collection N/A 157 1 3.5
Collection, and
CSA 20 1980 Secondary 22 1 0.3
Treatment
Collection,
Davenport Co 1979 Treatment, and Tertiary 109 3 3.0
Recycled Water
Freedom Co 1965 Collection N/A 1,891 9 15.3
Salsipuedes 1965 Collection N/A 512 2 7.0
Santa Cruz Co 1973 Collection N/A 36,000 35 220.0
Footnote: Data from the County’s 2022 Sewer System Management Plan and input from the subject agencies.
CSA 7 Zone 2 was defined in 2024.
Aging infrastructure and the need for repair, replacement, or upgrades are a growing
concern for most of the 10 sanitation districts. In some cases, a lack of funding has
postponed certain capital improvement projects. Not all sanitation districts have an
adopted capital improvement plan in place. The need for long-term maintenance planning
should be considered and determined by all sanitation districts to identify adequate
funding to address current and future maintenance, replacement needs, and/or upgrades
to their aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 9 of 177
Funding Source
Wastewater services are primarily funded through sewer charges. Wastewater service
rates include flat residential rates with commercial and institutional accounts being
charged a base rate plus quantity charge. The following table summarizes the current
annual wastewater rates. A full review of all wastewater rates for each sanitation district
is discussed in the District Profile Chapters within the report.
Table 3: Annual Sewer Rates (FY 24-25 data)
Single Multi Mobile
Commercial Use School Sites
Family Family Home
Bear Creek $3,277.92 - - - -
CSA 2 $1,517.64 $1,411.19 - - -
CSA 5 $2,109.91 $2,069.37 - - -
$1,895.67 plus
CSA 7 Zone 1 $2,757.51 $2,477.10 - -
$8.65/HCF
CSA 7 Zone 2(1) $3,728.81 - - $7,457.63 (2)
CSA 10 $388.11 (3) - - See Footnote (4) -
CSA 20 $4,178.67 - - - -
$749.72 plus $749.72 plus
Davenport Co $2,383.28 - -
$20.02/HCF $48.25/ADA
$198.92 plus $198.92 plus
Freedom Co $882.76 $576.66 $890.42
$7.84/HCF $18/90/ADA
Salsipuedes $782.16 $586.68 - $152.88 $82.32
$427.08 plus $427.08 plus
Santa Cruz County $1,073.28 $923.52 $788.64
volume fee (5) student count fee
Footnotes: (1) CSA 7 Zone 2 also has a “standby” charge for parcels that may connect once they have rebuilt after the CZU Fire. Standby charge is $932.20/parcel.
(2) The only commercial user is a fire station and is charged as two single-family dwellings; it is not comparable with other commercial rates. (3) $323.11 paid to Santa
Cruz County and $65.00 paid to City of Santa Cruz. (4) Pasatiempo Golf Course facility is the only commercial facility in CSA 10 and consists of multiple
buildings/users$6,096.68 is paid annually as a flat rate to Santa Cruz County (per an agreement based upon water usage at the time of the agreement) and in 2024,
$40,510 was paid to the City of Santa Cruz based on the amount of water used by Pasatiempo. (5) For list of volume and student count fees by user type see District
website at: https://sccsd.wpcomstaging.com/rates-charges/
For comparison purposes, the following figures show the sewer rates by category and
monthly costs (annual cost comparisons are shown in each individual agency chapter).
All 10 sanitation districts have single family units within their jurisdiction. The lowest rate
for single-family units is offered by CSA 10 ($26.93/month) and the highest is from CSA
20 ($348.22/month), as shown in Figure 3.
Figure 3: Monthly Sewer Rates for Single-Family Units
$400.00
$348.22
$350.00
$300.00 $273.16
$250.00
$198.61 $228.95
$200.00 $175.83
$150.00 $126.47
$89.44
$100.00 $65.18 $73.56
$50.00 $26.93
$0.00
Comprehensive Sanitation Service and Sphere Review Page 10 of 177
More than half of the 10 sanitation districts provide sewer service to multi-family
residential units. The lowest rate for multi-family units is offered by Freedom County
Sanitation District ($48.06/month) and the highest is from CSA 7 ($206.42/month), as
shown in Figure 4.
Figure 4: Monthly Sewer Rates for Multi-Family Units
$250.00
$206.42
$200.00
$172.45
$150.00
$117.60
$100.00
$76.96
$48.06 $48.89
$50.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Only 2 of the 10 sanitation districts provide sewer service to mobile home units. Santa
Cruz County Sanitation District currently offers the lowest sewer rate ($65.72/month)
when compared to Freedom County Sanitation District’s sewer rates for mobile home
units ($74.20/month), as shown in Figure 5.
Figure 5: Monthly Sewer Rates for Mobile Home Units
$76.00
$74.20
$74.00
$72.00
$70.00
$68.00
$65.72
$66.00
$64.00
$62.00
$60.00
Santa Cruz Co Freedom Co
Comprehensive Sanitation Service and Sphere Review Page 11 of 177
More than half of the 10 sanitation districts provide sewer service to commercial sites.
Various districts’ commercial rates are difficult to compare since there are some districts
that have flat fees, plus fees based on their water usage. To make a near equivalent
comparison the rate charged to a general business using 192 hundred cubic feet (typical
average water usage for this type of business) of water each year in each District is
compared in Figure 6. However, it is important to note that only one site is billed as
commercial in CSA 10 (Pasatiempo golf course and county club) and they pay one flat
rate for their entire facility to CSA 10 and a flat and usage fee to the City of Santa Cruz;
this is not comparable to the general business rates from the other districts.
Figure 6: Monthly Sewer Rates for Commercial Sites
$600.00
$517.95
$500.00
$401.92
$400.00
$303.52
$300.00
$239.38
$200.00
$146.39
$100.00
$12.74
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Footnote: Salsipuedes Sanitary District data only includes flat rate and does not include the average water
use measured in hundred cubic feet (HCF) & its associated HCF rate when compared to the other agencies.
Half of the 10 sanitation districts provide sewer service to school sites. Various districts’
school rates are difficult to compare since the schools have flat rate and usage fees. To
allow for a near equivalent comparison rates for a school with 135 students were
calculated for each sanitation district, as shown in Figure 7.
Figure 7: Monthly Sewer Rates for School Sites
$700.00
$636.27
$600.00
$500.00
$400.00 $344.41
$300.00
$236.63
$200.00
$100.00 $55.14
$6.86
$0.00
Salsipuedes CSA 10 Freedom Co Santa Cruz Co Davenport Co
Footnote: Salsipuedes Sanitary District data only includes flat rate and does not include the average water
use measured in hundred cubic feet (HCF) & its associated HCF rate or student rate when compared to
the other agencies. Also, this compares average daily attendance (ADA) rates from the elementary/junior
high user category for SCCSD to all other school’s elementary ADA user category rate. CSA 10 bills Brook
Knoll School as two single family dwellings.
Comprehensive Sanitation Service and Sphere Review Page 12 of 177
Financial Health
The sanitation districts are primarily funded through service charges. Table 4 highlights
whether districts annual revenue was enough to cover annual expenses for FY 2023-24.
Where deficits are shown in Table 4, it may not indicate a true deficit as often times
budgets are set with more expenditures than revenues if there is sufficient beginning
balances to cover the difference. This is done by sewer system managers to keep rates
low for rate payers and is not necessarily a reflection of financial health of the CSA or
District. It is only when districts have a large unanticipated expense do actual deficits
occur; there is not a trend of this happening in CSA 2 or CSA 7. A full review of all revenue
funds for each district during the past decade is discussed in the Profile Chapters within
this report.
Table 4: Total Revenue vs. Total Expense (FY 2023-24)
Sanitation Districts Total Revenue Total Expense Surplus/(Deficit) Net Position
Bear Creek Estates $173,021 $121,827 $51,194 $337,241
CSA 2 $115,389 $154,154 -$38,765 $295,746
CSA 5 $410,724 $350,377 $60,347 $749,716
CSA 7 (Zone 1) $568,219 $608,415 -$40,196 5,690,019
CSA 10 $122,037 $27,123 $94,914 1,115,134
CSA 20 $84,779 $83,827 $952 $5,925
Davenport Co $329,068 $295,935 $30,554 $762,535
Freedom Co $5,391,911 $1,705,838 $3,686,073 14,581,389
Salsipuedes $537,297 $329,870 $208,427 $2,858,033
Santa Cruz Co $34,729,590 $30,885,553 $3,844,037 $3,551,916
Footnote: Surplus/(Deficit) amounts are before any year-end adjustments
Potential Countywide Coordination
Out of the 10 sanitation districts being analyzed in this report, it is noteworthy to highlight
that the County manages and operates 8 of these agencies. More importantly, there is an
overall coordination between the 10 sanitation districts and other regional treatment plant
operators, including the Cities of Santa Cruz and Watsonville.
• City of Santa Cruz operates and maintains a regional wastewater treatment and
disposal facility. Wastewater treatment and ocean outfall disposal are provided for the
City of Santa Cruz and the Santa Cruz County Sanitation District, which include Live
Oak, Capitola, Soquel and Aptos. Ocean outfall disposal is provided for the City of
Scotts Valley.
• City of Watsonville operates as a regional treatment plant service for the City, the
Freedom County Sanitation District, Pajaro Dunes, the Salsipuedes Sanitary District,
and the Pajaro County Sanitation District in Monterey County. Additionally,
Watsonville has partnered with Pajaro Valley Water Management Agency in treating
municipal wastewater through their Water Recycle Plant. The treated water is mixed
with well water, delivered through the PVWMA’s coastal distribution system, and used
for crop irrigation.
These partnerships are based on separate contracts and agreements. It may be
beneficial to explore opportunities to combine or establish a regional agreement through
a Countywide Memorandum of Understanding or the creation of a Joint Powers Authority.
Comprehensive Sanitation Service and Sphere Review Page 13 of 177
• Memorandum of Understanding (MOU) – A Memorandum of Understanding
describes an agreement between two or more parties: in this case, the local agencies
that provide sewer services in Santa Cruz County. The MOU expresses a
convergence of wills between the parties, specifying an intended common line of
action or goal. The purpose of a MOU is to formally agree on the objectives, roles and
ground rules of the partnership between the local governments that holds the mandate
for service provision and the implementing organization. Establishing a clear
agreement can help prevent conflict and reputational harm because expectations
discussed, agreed upon and documented at an early stage leaves less room for
misinterpretation. It also increases transparency in the relationship with the public
authority and allows holding either party accountable to their commitments2.
• Joint Powers Authority (JPA) – defined by the California State Legislature Senate
Local Government Committee, is a formal, legal agreement between two or more
public agencies that share a common jurisdictional power and want to jointly
implement programs, build facilities, or deliver services. Officials from those public
agencies must formally approve a cooperative arrangement. JPAs offer another way
for governments to deliver services. With a JPA, a member agency agrees to be
responsible for delivering a service on behalf of the other member agencies. For
example, Marin County, City of Larkspur, and other special districts formed a JPA to
plan, acquire, construct, maintain and operate facilities, for either joint or sole use, for
the collection, treatment, reclamation and disposal of sewage and other wastewater
for the benefit of lands and inhabitants within the collective boundaries3.
Sphere of Influence
City and special district spheres of influence define the probable physical boundaries and
service area of a local agency, as determined by the Commission (Government Code
Section 56076). The law requires that spheres be updated at least once every five years,
either concurrently or subsequently with the preparation of service and sphere reviews.
Spheres are determined and amended solely at the discretion of the Commission. In
determining the sphere of influence for each local agency, the Commission is required by
Government Code Section 56425(e) to consider certain factors, including:
❖ The present & planned uses in the area, including agricultural & open-space lands;
❖ The present and probable need for public facilities and services in the area;
❖ The present capacity of public facilities and adequacy of public services that the
agency provides or is authorized to provide;
❖ The existence of any social or economic communities of interest in the area if the
commission determines that they are relevant to the agency; and
❖ An update on a sphere of influence for a city or special district that provides public
facilities or services related to sewers, municipal and industrial water, or structural fire
protection, that occurs pursuant to subdivision (g) on or after July 1, 2012, the present
and probable need for those public facilities and services of any disadvantaged
unincorporated communities within the existing sphere of influence.
2 Definition and purpose provided by the Water Integrity Network: https://www.waterintegritynetwork.net/2018/03/23/11124/
3 Information based on 2018 Joint Exercise of Powers Agreement: https://www.cmsa.us/assets/documents/administrative/2018%20CMSA%20JPA%20with%20Exhibits.pdf
Comprehensive Sanitation Service and Sphere Review Page 14 of 177
Sphere Determinations
Most of the spheres of influence for each sewer district were originally adopted between
1975 to 1991. Since then, the sphere boundaries have been evaluated during the last two
cycles of service reviews in 2016 and 2019. Table 5 shows the past and proposed sphere
determinations for each district. A full discussion about the proposed sphere
determinations is available in each agencies’ profile chapter as part of this report.
Table 5: Sphere Designations (1988 to 2025)
Sanitation Original Adoption Previous Sphere Review Current Sphere Review
District (Years Vary) (2019) (2025)
Proposed: Reaffirm
Bear Creek Zero Sphere (2019) Established Sphere
Zero Sphere
Proposed: Reaffirm
CSA 2 Coterminous Sphere (1988) Reaffirmed Sphere
Current Sphere
Proposed: Reaffirm
CSA 5 Coterminous Sphere (1988) Reaffirmed Sphere
Current Sphere
Proposed: Amend Sphere
CSA 7 Sphere Smaller than District (1987) Reaffirmed Sphere
to be Coterminous w/ District
Proposed: Reaffirm
CSA 10 Coterminous Sphere (1984) Reaffirmed Sphere
Current Sphere
Proposed: Reaffirm
CSA 20 Coterminous Sphere (2019) Established Sphere
Current Sphere
Proposed: Expand Sphere
Davenport Co Coterminous Sphere (1991) Reaffirmed Sphere
to include Existing ESA
Proposed: Reaffirm
Freedom Co Sphere Larger than District (1975) Reaffirmed Sphere
Current Sphere
Proposed: Amend Sphere
Salsipuedes Sphere Larger than District (1987) Reaffirmed Sphere
to be Coterminous w/ District
Proposed: Amend Sphere
Santa Cruz Co Sphere Smaller than District (1983) Reaffirmed Sphere
to be Coterminous w/ District
Comprehensive Sanitation Service and Sphere Review Page 15 of 177
Key Findings
The following are key findings of the 2025 Comprehensive Sanitation Service and Sphere
of Influence Review:
1. The County governs most of the sanitation districts.
Santa Cruz County has 10 sanitation districts, eight of them are operated and
governed by the County. Salsipuedes Sanitary District is the only independent special
district that provides sewer service. San Lorenzo Valley Water District is the only water
district that also provides sewer service to a small area of their jurisdiction. In total,
approximately 60% of the entire county (83,000 people) receive sewer service from
these 10 sanitation districts.
2. The majority of the districts’ financial health lacks stability.
LAFCO has determined that seven sanitation districts have ended with multiple annual
deficits in the last six fiscal years, and six districts have ended with consecutive annual
deficits in the same time span. Only three districts (CSA 10, Salsipuedes Sanitary
District, and Santa Cruz County Sanitation District) have ended a fiscal year without
a deficit between 2018 to 2024.
3. Benefits assessments increase on a regular basis.
The 10 sanitation districts are primarily funded through service charges, specifically
annual benefit assessments and sewer rates. It is LAFCO’s understanding that these
assessments are reviewed on a yearly basis by the County Board of Supervisors while
Davenport, Freedom, and Santa Cruz County Sanitation Districts have their own
boards. Sanitation Districts and CSAs operated by the county are governed by
Proposition 218,, and have resolutions in place to ensure annual rate increases of at
least Consumer Price Index (CPI).
4. The sanitation districts are transparent.
State law requires independent special districts to maintain a robust website to ensure
that constituents are aware of the local agencies’ operations and finances. While the
law does not apply to dependent special districts, LAFCO is impressed with the level
of transparency from the 10 sanitation districts. The County has a webpage dedicated
to all their sanitation districts which discloses financial information, board meeting
agendas and minutes, vicinity maps, or scheduled capital improvement projects. San
Lorenzo Valley Water District (for Bear Creek Estates) and Salsipuedes Sanitary
District also have robust websites. Based on LAFCO’s 2025 analysis, all 10 sanitation
districts met most of the benchmarks used to measure online transparency.
5. Certain sphere boundaries require amendments.
The original sphere boundaries for the Districts were primarily adopted between 1983
to 1991, with two being adopted in 2019 during LAFCO’s last service review cycle.
Based on LAFCO’s 2025 analysis, the sphere boundaries for CSA 7, Davenport
County Sanitation District, Freedom County Sanitation District, Salsipuedes Sanitary
District, and Santa Cruz County Sanitation District require modifications to accurately
reflect their service area. The remaining six spheres should be reaffirmed.
Comprehensive Sanitation Service and Sphere Review Page 16 of 177
Recommended Actions
Based on the analysis and findings in the 2025 Comprehensive Sanitation Service and
Sphere of Influence Review, the Executive Officer recommends that the Commission:
1. Find that pursuant to Section 15061(b)(3) of the State CEQA Guidelines, LAFCO
determined that the service and sphere of influence review is not subject to the
environmental impact evaluation process because it can be seen with certainty that
there is no possibility that the activity in question may have a significant effect on the
environment and the activity is not subject to CEQA;
2. Determine, pursuant to Government Code Section 56425, the Local Agency
Formation Commission of Santa Cruz County is required to develop and determine a
sphere of influence for the 10 sanitation districts, and review and update, as
necessary;
3. Determine, pursuant to Government Code Section 56430, the Local Agency
Formation Commission of Santa Cruz County is required to conduct a service review
before, or in conjunction with an action to establish or update a sphere of influence;
and
4. Adopt a Resolution (LAFCO No. 2025-11) approving the 2025 Comprehensive
Sanitation Service and Sphere Review, with the following terms and conditions:
a. Reaffirm sphere of influence boundary for the following: Bear Creek Estates
Wastewater System, CSA 2, CSA 5, CSA 10, CSA 20, and Freedom County
Sanitation District;
b. Amend the sphere of influence boundary to be coterminous with the jurisdictional
boundary for the following: CSA 7, Salsipuedes Sanitary District, and Santa Cruz
County Sanitation District;
c. Expand the sphere of influence boundary for the Davenport County Sanitation
District to include the existing extraterritorial service agreement; and
d. Direct the Executive Officer to distribute a copy of the adopted service and sphere
review to the 10 sanitation districts and any other interested or affected parties,
including but not limited to the County Department of Community Development &
Infrastructure (formally known as Public Works), the County Administrative Office,
and the four cities (Capitola, Santa Cruz, Scotts Valley, and Watsonville).
Comprehensive Sanitation Service and Sphere Review Page 17 of 177
BEAR CREEK ESTATES WASTEWATER SYSTEM
District Overview
The Bear Creek Estates Wastewater System, operated by the San Lorenzo Valley Water
District (SLVWD), provides wastewater collection and treatment for 56 parcels in a portion
of the Bear Creek Estates subdivision (units 3, 4, and 5). The Bear Creek Estates
Wastewater Treatment plant is located at 15900 Bear Creek Road, Boulder Creek,
California. It was initially constructed in 1985 as a septic tank treatment system. It was
designed to treat an average flow of 12,000 gallons per day (GPD) and a peak wet
weather flow of 32,500 gallons per day (GPD). The System consists of two (2) cast-in-
place, underground concrete tanks, four (4) above ground trickling media filters, an
influent pump station, an effluent pump station, and a 2.3-acre leach field. Figure 8, on
page 19, is a vicinity map of the service area. Appendix A provides a copy of the
formation resolution.
Sewer Provision History
The Bear Creek Estates subdivision was first developed between 1963 and 1965 and
expanded in 1975. Residential units were historically on private septic systems, and
approximately half the units remained on private septic systems during the conversion to
the sewer system. A private developer constructed the District’s wastewater collection
system and septic disposal system in 1985. The Wastewater System was acquired by
SLVWD when the development requested annexation into the District’s water system.
There are no direct wastewater system employees. The system is operated on a routine
or as needed basis with direct staff being allocated from the Water Fund Operations &
Distribution or Supply & Treatment Departments.
Population & Growth
There are no growth projections available for the San Lorenzo Valley Water District or the
Bear Creek Estates Wastewater System. In general, the Santa Cruz County
unincorporated area is projected to have slow growth over the next fifteen years. LAFCO
staff estimates that the population within the Bear Creek Estates Wastewater System was
approximately 185 in 2020. Based on the slow growth rate of 0.86% for the
unincorporated areas in the County, LAFCO staff projects that the System’s entire
population in 2040 may reach 191.
Under the assumed population growth, the projected population for the Bear Creek
Estates Wastewater System for the next 15 years are as follows:
Table 6: Projected Population
2020 2025 2030 2035 2040 Growth Rate
Santa Cruz County
136,891 137,896 139,105 140,356 141,645 0.86%
(unincorporated)
San Lorenzo Valley
19,882 20,052 20,224 20,398 20,572 0.86%
Water District
Bear Creek Estates
185 186 188 189 191 0.86%
Wastewater System
Source: AMBAG 2018 Regional Growth Forecast
Comprehensive Sanitation Service and Sphere Review Page 18 of 177
Figure 8: Bear Creek Estates Wastewater System’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 19 of 177
Services & Operations
The San Lorenzo Valley Water District owns, operates, and maintains a wastewater
system in Boulder Creek’s Bear Creek Estates. Based on staff’s analysis, the System has
56 connections with 1.2 miles of sewer lines and 2 pump stations. The System is
operating on a routine or as needed basis with staff being allocated from the Operations
& Distribution or Supply & Treatment Departments. An indirect allocation process is used
based on number of overall customers to allocate indirect costs identified as being a
shared benefit to all customers. The following are key highlights of the Bear Creek Estates
Wastewater System:
• The system collects and treats domestic wastewater flow;
• The existing collection system consists of 19 manholes, 2 cleanouts,
approximately 3,600 linear feet of gravity sewer, 2,600 linear feet of force mains,
2 sewer pump stations, and 56 laterals;
• From 2005 to 2013, the District completed several modifications aimed at
achieving regulatory compliance and improved nitrogen removal efficiency. This
resulted in the existing treatment septic system being modified to incorporate a 3-
stage trickling filter system, new internal recirculation/splitter/ball valves, and new
air blowers with high-capacity disc diffusers in the clarifier tanks; and
• Due to high regulatory requirements, there is still significant improvements needed
for the wastewater system.
Sewer Rates
At present, the System’s annual sewer rates derive from single-family units in the Bear
Creek Estates subdivision. Table 7 shows the gradual increase in annual rates during the
last 12 years. The District recently conducted a rate study to implement new rates that
would ensure adequate revenue was collected to cover annual expenses.
Table 7: Annual Sewer Rates
FY 13-14 to
FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
FY 18-19
Bear Creek
$1,788.00 $1,788.00 $2,136.00 $2,574.72 $3,089.64 $3,089.64 $3,182.40
Estates
Monthly
$149.00 $178.00 $214.56 $257.47 $257.47 $265.20 $273.16
Rate
Change
19% 21% 20% 0% 3% 3%
(%)
Comprehensive Sanitation Service and Sphere Review Page 20 of 177
Finances
This section will highlight the System’s audited financial performance during the most
recent fiscal years. Fiscal Year 2022-23 is the latest audited financial statement available.
A comprehensive analysis of the System’s financial performance during the past 12 years
is shown in Table 9, on page 23.
At the end of Fiscal Year 2022-23, total revenue collected was approximately $173,000,
which was virtually the same from the previous year ($173,034 in FY 21-22). Total
expenses for FY 2022-23 were approximately $184,000, which increased from the
previous year by approximately $22,000 ($162,153 in FY 21-22). During LAFCO’s last
service review analysis in 2019, the System experienced annual deficits in four of the five
fiscal years (FY 13-14 to FY 17-18). During this service review cycle, the System
experienced three annual deficits in the past five years (FY 18-19 to FY 22-23), as shown
in Figure 9 below. However, based on the two recently adopted budgets and the
upcoming rate increases, LAFCO staff believes that the District may now have enough
revenue to offset annual expenses.
Comprehensive Sanitation Service and Sphere Review Page 21 of 177
736,101$
831,59$
880,001$
692,201$
262,89$
999,321$
701,201$
828,261$
831,001$
919,541$
028,111$
782,641$
841,431$
635,471$
700,161$
321,931$
430,371$
351,261$
020,371$
781,481$
120,371$
728,121$
120,371$
904,521$
Figure 9: Statement of Revenues & Expenditures
$200,000
$180,000
$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$-
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget) (Budget)
Total Revenue Total Expenditure
District Revenues
The Bear Creek Estates Wastewater System’s only source of revenue is from Wastewater
Service Fees. On average, the System receives approximately $125,500 each year in
service fees. When comparing the sewer rates with the other sanitation districts analyzed
in this report, the Bear Creek Estates Wastewater System is ranked the second highest
in charges for single-family units ($3,277.92/year), as shown in Figure 10.
Figure 10: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00 $3,277.92
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
District Expenditures
The Bear Creek Estates Wastewater System’s total expenditures can be categorized into
4 budgetary groups: Salaries & Benefits, Administrative & General, Professional Services,
and Maintenance & Operations. Figure 11 distinguishes the cost and percentage per
category. As shown below, maintaining and operating the sewer infrastructure was the
highest expenditure during FY 2022-23.
Figure 11: FY 22-23 Expense Breakdown
Maintenance & Operations Salaries and Benefits
$72,233 (39%) $49,985 (27%)
Administrative & General Professional Services
$1,736 (1%) $60,233 (33%)
Comprehensive Sanitation Service and Sphere Review Page 22 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance was approximately $337,000. The following
table highlights the Fund Balance from 2018 to 2025. As Table 8 shows below, the fund
balance has fluctuated in recent years. On average, total reserves has decreased by
approximately $14,000 or 3% since FY 2013-14. A full review of the District’s revenues
and expenditures from FY 2013-14 to FY 24-25 is shown in Table 9.
Table 8: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Budget) (Budget)
Net Position
$304,837 $264,449 $286,333 $297,214 $286,047 $337,241 $384,853
(Ending Balance)
Change in ($) from
$(40,388) $21,884 $10,881 $(11,167) $51,194 $47,612
previous year
Change in (%) from
-13.25% 8.28% 3.80% -3.76% 17.90% 14.12%
previous year
Table 9: Total Revenues & Expenditures (12 Year Overview)
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget) (Budget)
REVENUE
Wastewater Service $ 1 01,637 $ 1 00,088 $ 98,262 $ 1 02,107 $ 1 00,138 $ 1 11,820 $ 1 34,148 $ 1 61,007 $ 1 73,034 $ 1 73,020 $ 1 73,021 $ 1 73,021
Total Revenue $ 1 01,637 $ 1 00,088 $ 98,262 $ 1 02,107 $ 1 00,138 $ 1 11,820 $ 1 34,148 $ 1 61,007 $ 1 73,034 $ 1 73,020 $ 1 73,021 $ 1 73,021
EXPENDITURE
Salaries and Benefits $ 12,954 $ 7 ,213 $ - $ - $ 47,796 $ 48,499 $ 44,296 $ 34,608 $ 48,591 $ 49,985 $ 33,919 $ 34,371
Professional Services $ 5 ,406 $ 21,500 $ 33,791 $ 66,751 $ 28,423 $ 28,744 $ 62,178 $ 35,527 $ 43,079 $ 60,233 $ 39,231 $ 39,197
Operational $ 10,620 $ 2 ,453 $ 12,285 $ 18,319 $ 16,116 $ 15,211 $ 11,228 $ 13,661 $ 15,213 $ 26,589 $ 32,074 $ 34,074
Maintenance $ 280 $ - $ - $ - $ 1 ,106 $ 1 ,140 $ 1 ,503 $ 1 ,356 $ 1 ,392 $ 1 ,477 $ 2 ,984 $ 3 ,705
Facilities $ 8 ,769 $ 8 ,608 $ 15,486 $ 8 ,403 $ 8 ,384 $ 9 ,085 $ 11,816 $ 10,390 $ 8 ,745 $ 8 ,940 $ 12,273 $ 12,708
General and Administrative$ 15,336 $ 20,749 $ - $ - $ 1 ,738 $ 1 ,607 $ 1 ,515 $ 1 ,580 $ 1 ,650 $ 1 ,736 $ 1 ,346 $ 1 ,354
Overhead Adsorption $ - $ - $ 22,987 $ 26,998 $ - $ - $ - $ - $ - $ ( 8,331) $ - $ -
Depreciation $ 41,773 $ 41,773 $ 39,450 $ 42,357 $ 42,356 $ 42,001 $ 42,000 $ 42,001 $ 43,483 $ 43,558 $ - $ -
Total Expenditure $ 95,138 $ 102,296 $ 123,999 $ 162,828 $ 145,919 $ 146,287 $ 174,536 $ 139,123 $ 162,153 $ 184,187 $ 121,827 $ 125,409
Surplus/(Deficit) $ 6 ,499 $ ( 2,208) $ (25,737) $ ( 60,721) $ ( 45,781) $ ( 34,467) $ (40,388) $ 21,884 $ 10,881 $ ( 11,167) $ 51,194 $ 47,612
Net Position - Beginning $ 4 67,252 $ 4 73,751 $ 4 71,543 $ 4 45,806 $ 3 85,085 $ 3 39,304 $ 3 04,837 $ 2 64,449 $ 2 86,333 $ 2 97,214 $ 2 86,047 $ 3 37,241
Net Position - Ending $ 4 73,751 $ 4 71,543 $ 4 45,806 $ 3 85,085 $ 3 39,304 $ 3 04,837 $ 2 64,449 $ 2 86,333 $ 2 97,214 $ 2 86,047 $ 3 37,241 $ 3 84,853
Comprehensive Sanitation Service and Sphere Review Page 23 of 177
Governance
The San Lorenzo Valley Water District currently owns and operates the Bear Creek
Estates Wastewater System. SLVWD is an independent special district governed by a
five-member Board of Directors elected at-large by the voters within the District. When
candidates run unopposed, they are appointed by the County Board of Supervisors in lieu
of conducting the election. The current Board is as follows:
Table 10: Board of Directors
Board Member Title Term of Office
Mark Smolley President 12/16/22 to 12/15/26
Alina Layng Vice President 12/6/24 to 12/5/28
Bryan Largay Director 12/6/24 to 12/5/28
Bob Fultz Director 12/16/22 to 12/15/26
Jeff Hill Director 12/16/22 to 12/15/26
The Board of Directors meet on the first and third Thursday of each month at 6:30 PM.
Meetings are held at various locations throughout the San Lorenzo Valley. Public notice
is provided through posting. The District also contracts for independent audits.
Capital Improvement Plan
The San Lorenzo Valley Water District has adopted a District-wide capital improvement
plan. Based on staff’s research, there are no capital improvement projects scheduled for
the Bear Creek Estates Wastewater System. The District should consider adopting a
long-term maintenance plan to ensure scheduled and unforeseen repairs, replacements,
and installations are adequately funded.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following:
• Sanitary Sewer Overflows are prohibited, and
• All Sanitary Sewer Overflow (SSOs), with the exception of Private Sewer Lateral
Discharge (PLSDs), irrespective of size, must be reported to the State Water Board
electronically using the California Integrated Water Quality System, and the
Districts/CSAs must prepare and implement a Sewer System Management Plan
(SSMP).
The San Lorenzo Valley Water District has adopted an Urban Water Management Plan,
which includes a description of the existing location and capacity of the Wastewater
System. It is LAFCO staff’s understanding that the District does not have an adopted
SSMP.
Website Requirements
Comprehensive Sanitation Service and Sphere Review Page 24 of 177
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the System’s webpage. Table 11 summarizes staff’s findings on
whether the website meets the statutory requirements. At present, the District almost
meets all the statutory requirements under SB 929 and SDLF’s website transparency
criteria. The District is only missing access to LAFCO’s adopted service and sphere
reviews on their website. Overall, SLVWD has a transparent website filled with useful
information and resources easily accessible to the public regarding its water and
wastewater services.
Table 11: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported
✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews
Total Score (out of a possible 20) 19 (95%)
Comprehensive Sanitation Service and Sphere Review Page 25 of 177
Opportunities & Challenges
The Bear Creek Estates Wastewater System is significantly affected by aging
infrastructure, escalating operational costs, and changes to state laws and regulations
that may introduce new requirements without additional funding. These issues are
common with other sanitation districts in Santa Cruz County. The following section
discusses these challenges and identifies possible opportunities to ensure the delivery of
wastewater services in an efficient and effective manner.
Governance Structure Options
The San Lorenzo Valley Water District has expressed a desire to transfer ownership and
operation of the wastewater system to another agency, such as the County of Santa Cruz,
which may be able to operate the system more efficiently. The District’s 2016 Strategic
Plan identifies specific steps to potentially transfer service provisions to another local
agency. These steps include:
• Development of a rate-study that will establish operational and capital needs of the
wastewater system;
• Implement a Proposition 218 rate increase process that will set rates appropriate
to the operational and capital needs of the system; and
• Coordination with Bear Creek Estates residents, meeting with County
representatives on a regular basis to discuss and move this idea forward, and
collaboratively establish a plan with a timeline and key milestones.
LAFCO staff sees value in local agencies collaborating and exploring opportunities to
improve delivery of municipal services. Now that the District has adopted new rates to
ensure adequate revenue funds, this may be an opportunity to coordinate with the County
to perhaps form a new county service area and transfer sewer responsibilities from
SLVWD to the County. It is still unknown whether it is feasible for the County or another
local service provider to assume responsibilities within this area. Therefore, LAFCO staff
recommends that the District continue to discuss possible partnerships with the County
and other neighboring agencies.
Sphere of Influence
LAFCO has established a zero sphere for the Bear Creek Estates Wastewater System in
2019. A “zero” sphere of influence designation (encompassing no territory) means that
the public service functions of the agency are either: nonexistent, no longer needed, or
should be reallocated to some other agency of government. The adoption of a “zero”
sphere indicates the agency should transfer service responsibilities to another local
agency. Figure 12, on page 27, shows the current sphere of influence boundary for the
Bear Creek Estates Wastewater System. LAFCO staff is recommending that the
Commission reaffirm the sphere boundary.
Comprehensive Sanitation Service and Sphere Review Page 26 of 177
Figure 12: Current Sphere of Influence
Comprehensive Sanitation Service and Sphere Review Page 27 of 177
District Summary
Bear Creek Estates Wastewater System (San Lorenzo Valley Water District)
Formation California Water Code, section 30,000 et seq.
Board of Directors Five members, elected at-large to four-year terms
Contact Person Jason Lillion, General Manager
36 Full-Time Employees and 2 Part-Time Employee
Employees
(entire SLVWD)
19 manholes, 2 cleanouts, approximately 3,600 linear feet of
Facilities gravity sewer, 2,600 linear feet of force mains, 2 sewer pump
stations, and 56 laterals
District Area 18.44 acres (0.029 square miles)
Current Designation: Zero Sphere of Influence
Sphere of Influence
Proposed Designation: Reaffirm Zero Sphere of Influence
Total Revenue = $173,021
FY 2024-25 Budget Total Expenditure = $125,409
Projected Net Position (Beginning Balance) = $337,241
Mailing Address: 13060 Highway 9 Boulder Creek CA 95006
Phone Number: (831) 430-4636
Contact Information
Email Address: bod@slvwd.com
Website: http://www.slvwd.com/_BearCreek.htm
Meetings are typically held on the first and third Thursday of each
Public Meetings
month at 6:30 p.m.
"Our mission is to provide our customers and all future
generations with reliable, safe and high quality water at an
equitable price; to create and maintain outstanding customer
Mission Statement
service; to manage and protect the environmental health of the
aquifers and watersheds; and, to ensure the fiscal vitality of the
San Lorenzo Valley Water District."
Comprehensive Sanitation Service and Sphere Review Page 28 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
There are no growth projections available for the San Lorenzo Valley Water District or
the Bear Creek Estates Wastewater System. In general, the Santa Cruz County
unincorporated area is projected to have slow growth over the next fifteen years.
LAFCO staff estimates that the System’s entire population in 2040 will be around 190.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within the Bear Creek Estates Wastewater System.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
Since the development of the Bear Creek Estates subdivision back in 1985, SLVWD
has been providing sewer service to 56 connections under the governance of the Bear
Creek Estates Wastewater System. This residential subdivision has approximately
183 residents and represents approximately 2% of the total population within the San
Lorenzo Valley Water District. The District has expressed interest in transferring sewer
service responsibilities to another local agency.
4. Financial ability of agencies to provide services.
The Bear Creek Estates Wastewater System has experienced various annual deficits
over the past 12 years. However, it is LAFCO’s understanding that the District has
implemented new rates to ensure that adequate revenue funds are being collected to
offset increases in annual expenses.
5. Status of, and opportunities for, shared facilities.
Several sanitation districts, including the Bear Creek Estates Wastewater System,
have expressed interest in transferring sewer responsibilities to another agency due
to funding issues, limited long-term planning, or lack of economies of scale.
Establishment of a countywide memorandum of understanding or a joint powers
authority may unify the already-established collaboration set by the sanitation
providers in the county.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The San Lorenzo Valley Water District has adopted a District-wide capital
improvement plan. Based on staff’s research, there are no capital improvement
Comprehensive Sanitation Service and Sphere Review Page 29 of 177
projects scheduled involving the Bear Creek Estates Wastewater System. The District
should consider adopting a long-term maintenance plan to ensure scheduled and
unforeseen repairs, replacements, and installations are adequately funded.
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
The Bear Creek Estates Wastewater System’s service area is built out with residential
homes. There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
SLVWD has expressed interest in transferring sewer responsibilities to another local
governmental entity. LAFCO may play a role in helping find a successor agency. The
District’s 2016 Strategic Plan identifies specific steps to potentially transfer service
provisions to another local agency.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
SLVWD owns, operates, and maintains a wastewater system in Boulder Creek’s Bear
Creek Estates. The System has 56 connections with 1.2 miles of sewer lines and 2
pump stations. The System is operating on a routine or as needed basis with staff
being allocated from the Operations & Distribution or Supply & Treatment
Departments.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The Bear Creek Estates Wastewater System’s service area is primarily single-
family homes.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, the District has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
The District’s principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 30 of 177
COUNTY SERVICE AREA 2
(PLACE DE MER)
District Overview
County Service Area 2 serves the Place de Mer subdivision which encompasses 12.8
acres (0.02 square miles). The wastewater facility is a community advanced secondary
treatment system (106 parcels) with 78 connections. The existing treatment system was
required and approved by the State Water Board. The system was constructed in 2022
and was funded by the formation of the Assessment District No. 21-01. Figure 13, on
page 32, is a vicinity map of the service area. Appendix B provides a copy of the
formation resolution.
Population & Growth
The Place de Mer subdivision is an ocean-front residential development in La Selva
Beach that is substantially built-out. There are no growth projections available for CSA 2.
In general, the Santa Cruz County unincorporated area is projected to have slow growth
over the next fifteen years. Based on the growth rate of approximately 1% for the
unincorporated areas in the County, LAFCO staff projects that CSA 2’s entire population
in 2040 will be around 174. The projected population for CSA 2 are as follows:
Table 12: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
CSA 2 169 171 172 174 0.86%
Source: AMBAG 2018 Regional Growth Forecast
Services & Operations
CSA 2 Place De Mer has a new advanced secondary treatment system that services the
privately-owned residential properties. The system is maintained by the County of Santa
Cruz. Based on staff’s analysis, CSA 2 has 78 connections with 0.4 miles of sewer lines
and 2 pump stations. Fifteen parcels (Zone H) are on their own septic system and pay
the CSA for park maintenance and security. Annual sewer charges are the District’s
primary source of revenue.
Infrastructure Summary
CSA 2 operates a two-pump station advanced secondary treatment system. It currently
has 78 connections and approximately 0.4 miles of sewer line. Table 13 provides an
overview of the type of service and current infrastructure:
Table 13: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Advanced
CSA 2 Secondary N/A 78 2 0.4
Treatment
Comprehensive Sanitation Service and Sphere Review Page 31 of 177
Figure 13: CSA 2’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 32 of 177
Sewer Rates
At present, CSA 2’s annual sewer rates are based on four zones: Apartment (Zone A),
Hill (Zone H), Park (Zone P), and Townhouse (Zone T). Each zone has its own sewer
rate. Table 14 shows the gradual increase in annual rates during the last seven years.
Table 14: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Zone
$1,151.75 $1,203.57 $1,233.66 $1,258.33 $1,311.18 $1,375.43 $1,411.19
A
Zone
$97.38 $101.76 $104.30 $106.39 $110.86 $116.29 $119.31
H*
Zone
$1,151.75 $1,203.57 $1,233.66 $1,258.33 $1,311.18 $1,375.43 $1,411.19
P
Zone
$1,238.62 $1,294.36 $1,326.72 $1,353.25 $1,410.09 $1,479.18 $1,517.64
T
Footnote: Zone H (individual septic)
Pursuant to Santa Cruz County Code Section 4.26, the Director of CDI must annually
compute the benefit assessment/service charge rates for CSAs and submit a report to
the Board of Supervisors describing each parcel of real property receiving the special
benefit and the amount of the charge per CSA for each parcel for the upcoming fiscal
year.
CSA fees are sewer rate charges, and any rate increase (except for preapproved annual
Consumer Price Index (CPI) increases) must comply with Proposition 218 procedures.
These procedures state that an increase is approved as long as it is not protested by 51%
of the connected parcel owners. A public hearing must be held to consider any protests
to the proposed increase. The following tables (Tables 15 to 18) depict the change in
dollar amount and percentage for each specific zone.
Table 15: Zone A (Apartments) Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Zone A $1,151.75 $1,203.57 $1,233.66 $1,258.33 $1,311.18 $1,375.43 $1,411.19
Change
$51.82 $30.09 $24.67 $52.85 $64.25 $35.76 $37.08
($)
Change
4% 3% 2% 4% 5% 3% 3%
(%)
Table 16: Zone H (Hill) Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Zone H $97.38 $101.76 $104.30 $106.39 $110.86 $116.29 $119.31
Change
$4.38 $2.54 $2.09 $4.47 $5.43 $3.02 $2.95
($)
Change
4% 2% 2% 4% 5% 3% 3%
(%)
Comprehensive Sanitation Service and Sphere Review Page 33 of 177
Table 17: Zone P (Park) Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Zone P $1,151.75 $1,203.57 $1,233.66 $1,258.33 $1,311.18 $1,375.43 $1,411.19
Change
$51.82 $30.09 $24.67 $52.85 $64.25 $35.76 $37.08
($)
Change
4% 3% 2% 4% 5% 3% 3%
(%)
Table 18: Zone T (Townhouse) Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Zone T $1,238.62 $1,294.36 $1,326.72 $1,353.25 $1,410.09 $1,479.18 $1,517.64
Change
$55.74 $32.36 $26.53 $56.84 $69.09 $38.46 $39.88
($)
Change
5% 3% 2% 4% 5% 3% 3%
(%)
When comparing the sewer rates with the other sanitation districts analyzed in this report,
CSA 2’s multi-family rates ($1,411.19/year and $1,517.64/year). rank in fourth place out
of six. Sewer rate comparisons are shown in Figure 14.
Figure 14: Annual Sewer Rates for Multi-Family Units
$3,000.00
$2,500.00
$2,000.00
$1,411.19
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Single Family $576.66 $586.68 $923.52 $1,411.19 $2,069.37 $2,477.10
Assessment District
In addition to the annual sewer rates, the formation of the Assessment District No. 21-01
charges between $1,679.48 to $2,676.00 annually to the parcel owners. Each zone is
subject to various rates as shown below:
• Zone A $1,679.48
• Zone H -$0 (since these properties utilize septic systems)
• Zone P- $2,676.00
• Zone T - $1,804.86
The bonds for the Assessment District will be paid in full by the 2052 calendar year.
Assessment District No. 21-01 was formed to finance the replacement of the aging septic
system with an onsite wastewater treatment plant. It is important to note that assessment
districts are not subject to LAFCO’s purview since they are funding mechanisms created
by local agencies, including counties.
Comprehensive Sanitation Service and Sphere Review Page 34 of 177
Finances
This section will highlight the District’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the District’s financial performance during the past 12 years
is shown in Table 21 on page 37.
At the end of Fiscal Year 2023-24, total revenue collected was $115,389, representing a
6% increase from the previous year ($108,627 in FY 22-23). Total expenses for FY 2023-
24 were $154,154, which increased from the previous year by 40% ($110,225 in FY 22-
23). During LAFCO’s last service review analysis in 2019, CSA 2 experienced annual
surpluses in four of the five fiscal years (FY 13-14 to FY 17-18). However, during this
service review cycle, CSA 2 experienced six consecutive annual deficits in the past six
years (FY 18-19 to FY 23-24), as shown in Figure 15 below. However, a deficit calculated
as a difference between the year’s revenue and the year’s expenditures is not always a
true deficit. Annual budgets are set so there are not more expenditures than the sum of
the beginning fund balance plus that year’s revenue. Therefore, even with the six
consecutive years of annual deficits, the CSA’s net ending position has remained positive.
Comprehensive Sanitation Service and Sphere Review Page 35 of 177
385,58$
492,22$
659,58$
189,94$
331,09$
872,93$
740,39$
717,03$
539,001$
954,161$
041,301$
314,561$
770,501$
207,661$
464,201$ 836,101$
438,801$
983,511$
295,611$
$237,380
699,421$
522,011$
451,451$
223,241$
Figure 15: Statement of Revenues & Expenditures
$250,000
$200,000
$150,000
$100,000
$50,000
$-
FY 13-14FY 14-15FY 15-16FY 16-17FY 17-18FY 18-19FY 19-20FY 20-21FY 21-22FY 22-23FY 23-24FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
CSA Revenues
CSA 2’s primary source of revenue is from Charges for Services. In FY 23-24, the District
received revenue from two different sources: Charges for Services ($112,662) and
Interest and Investment Income ($2,727). On average, the District receives approximately
$103,000 each year in service fees. Table 19 highlights the total revenue received since
2018.
Table 19: Total Revenue (FY 18-19 to FY 23-24)
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
Charges for Services $94,340 $98,585 $101,050 $103,070 $107,400 $112,662
Intergovernmental $59 - - - - -
Interest Investment
$8,741 $6,492 $1,414 -$1,433 $1,434 $2,727
Income
Total Revenue $103,140 $105,077 $102,464 $101,638 $108,834 $115,389
Footnote: Intergovernmental revenue is derived from FEMA funds to repair failing infrastructure.
CSA Expenditures
CSA 2’s total expenditures can be categorized into two budgetary groups: Services &
Supplies and Depreciation & Amortization. Figure 16 below depicts how funding is
distributed by category. The District’s primary expenditure is associated with operational
and management costs, under Services and Supplies.
Figure 16: FY 2017-18 Expenditure Breakdown
Depreciation and Amortization
$5,542 (4%)
Services and Supplies
$148,612 (96%)
Comprehensive Sanitation Service and Sphere Review Page 36 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $276,000. The following
table highlights the Fund Balance from 2018 to 2025. As Table 20 shows below, the
District has experienced a decrease in total reserves each year. On average, total
reserves have decreased by approximately $23,400 or 5% since FY 2013-14. A full
review of the District’s revenues and expenditures from FY 2013-14 to FY 24-25 is shown
on Table 21.
The use of capital reserves was a result of the CSA 2s failing septic systems. A new
wastewater treatment system was constructed in 2022. In FY23-24, CSA 2s security
services were included in a County of SC master independent contract agreement and
services were too costly and therefore suspended. A community meeting was held to
discuss rate increases if they chose to continue with these services. The updated
wastewater system at CSA 2 (new gravity sewer lines and septic system) will not need
repairs like an older system would in the near term. A planned private project will impact
the CSA's force main and a retaining wall, so the improvements paid for by that property
owner on the CSA's infrastructure will update the system even further.
Table 20: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $516,798 $455,176 $320,260 $296,902 $295,511 $256,746 $250,558
Change in ($) from
$(61,622) $(134,916) $(23,358) $(1,391) $(38,765) $(6,188)
previous year
Change in (%) from
-12% -30% -7% -0.5% -13% -2%
previous year
Table 21: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 82,983 $ 84,016 $ 87,150 $ 88,580 $ 91,681 $ 94,340 $ 98,585 $ 1 01,050 $ 1 03,070 $ 1 07,400 $ 1 12,662 $ 1 15,592
Intergovernmental $ - $ - $ - $ - $ 2 ,875 $ 5 9 $ - $ - $ - $ - $ - $ -
Interest and Investment Income $ 2 ,600 $ 1 ,940 $ 2 ,983 $ 4 ,467 $ 6 ,379 $ 8 ,741 $ 6 ,492 $ 1 ,414 $ (1,432) $ 1 ,434 $ 2 ,727 $ 1 ,000
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Gain on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Revenue $ 85,583 $ 85,956 $ 90,133 $ 93,047 $ 1 00,935 $ 1 03,140 $ 1 05,077 $ 1 02,464 $ 1 01,638 $ 1 08,834 $ 115,389 $ 1 16,592
EXPENDITURES
Services and Supplies $ 16,752 $ 44,439 $ 33,736 $ 25,175 $ 1 44,091 $ 1 59,871 $ 1 61,160 $ 2 31,838 $ 1 19,454 $ 1 04,683 $ 1 48,612 $ 1 36,780
Depreciation and Amortization $ 5 ,542 $ 5 ,542 $ 5 ,542 $ 5 ,542 $ 5 ,542 $ (5,542) $ 5 ,542 $ 5 ,542 $ 5 ,542 $ 5 ,542 $ 5 ,542 $ 5 ,542
Depreciation Storage Tanks $ - $ - $ - $ - $ - $ 11,084 $ - $ - $ - $ - $ - $ -
Loss on Disposal of Capital Assets $ - $ - $ - $ - $ 11,826 $ - $ - $ - $ - $ - $ - $ -
Total Expenditure $ 22,294 $ 49,981 $ 39,278 $ 30,717 $ 1 61,459 $ 1 65,413 $ 1 66,702 $ 2 37,380 $ 1 24,996 $ 1 10,225 $ 154,154 $ 1 42,322
Surplus/(Deficit) $ 63,289 $ 35,975 $ 50,855 $ 62,330 $ (60,524) $ (62,273) $ (61,625) $ (134,916) $ (23,358) $ (1,391) $ (38,765) $ (25,730)
Net Position - Beginning $ 4 27,146 $ 4 90,435 $ 5 26,410 $ 5 77,265 $ 6 39,595 $ 5 79,071 $ 5 16,801 $ 4 55,176 $ 3 20,260 $ 2 96,902 $ 2 95,511 $ 2 56,746
Net Position - Ending $ 4 90,435 $ 5 26,410 $ 5 77,265 $ 6 39,595 $ 5 79,071 $ 5 16,798 $ 4 55,176 $ 3 20,260 $ 2 96,902 $ 2 95,511 $ 2 56,746 $ 2 31,016
RESERVES
Capital Replacement Reserve $ 310,551 $ 218,493 $ 384,704 $ 444,181 $ 314,181 $ 341,028 $ 273,553 $ 58,435 $ 127,402 $ 26,383 $ 34,127 $ 26,163
Currently, there is $22,590 available in reserves. As always, County staff will consider at
increasing reserves when we analyze the rate increase for FY26-27. They will seek
community involvement during the rate-setting process to balance the need to increase
reserves while still providing reasonable rates.
Comprehensive Sanitation Service and Sphere Review Page 37 of 177
Governance
County Service Area 2 is a dependent special district governed by the County Board of
Supervisors and managed by the Community Development & Infrastructure Public Works
Division. The current Board is as follows:
Table 22: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors generally meets twice a month on a Tuesday in the Board of
Supervisors’ Chambers, 701 Ocean Street, Room 525. Meetings generally begin at
9:00am. Public notice is provided through posting. The County contracts for independent
audits.
The County Community Development & Infrastructure Public Works Division is
responsible for the administration, engineering, maintenance, emergency response and
construction of all County sanitation services. The department also manages various
Board-governed special districts and CSAs. The Sanitation Operations unit is one of six
organizational units within the Special Services Division of Public Works and provides
operation and maintenance services to County sanitation districts and CSAs. Sanitation
operations employees work in all Districts and CSAs. Each sanitation district is governed
according to its specific code of regulations. The Districts’ codes are very similar, and
some sections are adopted by reference from the Santa Cruz County Sanitation District
Code. CSAs are governed according to the Santa Cruz County Code of Regulations. Most
of the County Code pertaining to sanitary sewer collection systems is adopted by
reference from the SCCSD Code.
Comprehensive Sanitation Service and Sphere Review Page 38 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the CSA’s website (even though said law only applies to independent
special districts). Table 23 summarizes staff’s findings on whether the website meets the
statutory requirements. At present, the CSA does meet the statutory requirements set
under SB 929 and SDLF’s website transparency criteria. LAFCO appreciates the recent
efforts by the County to revamp the organization’s website, which included a new
webpage specifically for the sewer agencies governed and managed by the County.
Table 23: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 39 of 177
Opportunities & Challenges
County Service Area 2 is significantly affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Capital Improvement Plan
There is no specific capital improvement plan for CSA 2, however, CSA 2 is part of the
County’s 2021/22 Capital Improvement Program. The 2021/22 CIP presents a five-year
financing implementation plan for capital improvements within the unincorporated County;
Parks, Open Space and Cultural Services; and County Facility projects located
Countywide. The CIP is an outgrowth of cooperative planning, programming and
financing efforts through the County Administrative Office and by the County’s land use
departments including Planning, Public Works, and Parks, Open Space and Cultural
Services, as well as non-land use departments including the Health Services Agency,
General Services Department, Probation, and the Sheriff’s Department. Unprogrammed
road, roadside, sanitation, flood control, parks, and recycling and solid waste projects
(which funding is not anticipated for in the coming five years, or longer, and meets
requirements of unincorporated County service level needs at build-out under the 1994
General Plan) are also identified in the CIP. The Place De Mer Septic System project
was in the CIP and has now been completed. The County continuously seeks grant or
loan funding to help finance these improvements.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following:
• Sanitary Sewer Spills are prohibited, and
• All Sanitary Sewer Spills, with the exception of Private Sewer Lateral Discharge
(PLSDs), irrespective of size, must be reported to the State Water Board electronically
using the California Integrated Water Quality System, and the Districts/CSAs must
prepare and implement a Sewer System Management Plan (SSMP).
In 2022, the County adopted an SSMP to cover the management, operation and
maintenance, design, construction and emergency response of the Davenport Sanitation
District, Freedom Sanitation District, Santa Cruz County Sanitation District and three
county service areas (CSAs 5, 7, and 10). However, it is LAFCO staff’s understanding
that CSA 2 is excluded from the County SSMP because the CSA does not meet the
minimum requirements to enroll under the Waste Discharge Requirements.
LAFCO Staff Recommendation: The State of California does not require sewer systems
with less than one mile of sewer pipe infrastructure to have a Sewer System Management
Plan, however, the County should consider including CSA 2 in the County’s Sewer
System Management Plan to ensure that the Place de Mer community’s sewer
infrastructure has proper management and oversight for current and future needs.
Comprehensive Sanitation Service and Sphere Review Page 40 of 177
Infrastructure Deficiencies
In 2019, Sanitation Operations staff investigated the cause of the failing septic tank
system and found that the pipe for the leach pits had collapsed in some areas and caused
sewage to flow back to the undersized and corroded precast concrete septic tanks.
Biosphere Consulting Incorporated (Biosphere) of Santa Cruz, California was retained to
design the improvements of the wastewater treatment system to serve Place De Mer. A
design was completed and submitted to the Regional Water Quality Control Board
(RWQCB) for approval.
Due to the wet weather causing infiltration into the septic tanks and the ongoing work by
Biosphere, it is necessary to transfer funds from the capital reserves to operations and
structures and improvements. A total of $130,000 is required to cover the maintenance
and the replacement tanks and leach pit design costs. The CSA does not have the
reserves to pay for the required septic system upgrades. An assessment district was
required to fund the necessary improvements and was approved by the Place de Mer
community in May 2021. The Place de Mer Septic Improvements project included
replacing most of the sewer infrastructure except the 4-inch force main that pumps the
wastewater from the lower pump station to the upper pump station. The County may
consider adopting a long-term capital improvement plan for CSA 2 to ensure scheduled
and unforeseen repairs and replacements are adequately funded.
Sphere of Influence
LAFCO originally adopted a coterminous sphere of influence for the District in 1988. A
coterminous sphere of influence is identical to the agency’s jurisdictional boundary. For
almost 40 years, the sphere boundary has remained unchanged. LAFCO staff, along with
representatives of CSA 2, do not recommend any changes to the sphere of influence at
this time. Figure 17 on page 42 shows the current sphere of influence boundary.
Comprehensive Sanitation Service and Sphere Review Page 41 of 177
Figure 17: CSA 2’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 42 of 177
District Summary
County Service Area 2 (Place de Mer)
California Government Code, section 25210.1 et seq.
Formation
(County Service Area Law)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 1.50 full-time employee (approximately)
Two-pump station and advanced treatment system; 78
Facilities
connections
District Area 12.8 acres (0.02 square miles)
Coterminous with District (i.e. no sphere beyond existing
Sphere of Influence
jurisdictional boundary)
Total Revenue = $116,592
FY 2024-25 Budget Total Expenditure = $142,322
Projected Net Position (Beginning Balance) = $256,746
Mailing Address: 701 Ocean Street, Room 410, Santa Cruz CA
95060
Phone Number: (831) 454-2160
Contact Information Email Address: Matt.Machado@santacruzcountyca.gov
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
CSA Liaisons: Sarah Katley sarahlk@mac.com
King Management - Samantha Jasso (475-9100)
The Board regularly meets every second Tuesday in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings
generally begin at 9:00 am.
The CSA does not have a published mission statement. However,
Mission Statement their mission aligns with the published mission statement for the
Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 43 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Place de Mer subdivision is an ocean-front residential development in La Selva
Beach that is substantially built-out. There are no growth projections available for CSA
2. In general, the Santa Cruz County unincorporated area is projected to have slow
growth over the next fifteen years. Based on the growth rate of approximately 1% for
the unincorporated areas in the County, LAFCO staff projects that CSA 2’s entire
population in 2040 will be around 174.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within CSA 2.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
County Service Area 2 has been collecting and disposing wastewater from the ocean-
front townhome development in La Selva Beach, known as Place de Mer, since the
construction of the septic system back in 1972. The current two-pump station
community septic tank system has 78 connections and serves about 169 residents.
4. Financial ability of agencies to provide services.
County Service Area 2 is struggling financially. The CSA has experienced an annual
deficient in seven consecutive years. As of June 30, 2024, CSA 2 is operating with a
net position of approximately $257,000.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The County currently has a countywide capital improvement plan and a specific capital
improvement plan for the Santa Cruz County Sanitation District. Additionally, the
County has adopted a Sewer System Management Plan. However, CSA 2 does not
have any current or proposed sewer-related capital improvement projects scheduled
at this time.
Comprehensive Sanitation Service and Sphere Review Page 44 of 177
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
The Place de Mer subdivision is an ocean-front residential development in La Selva
Beach that is substantially built-out. There are no agricultural or open-space lands
within the service area.
2. The present and probable need for public facilities and services in the area.
The Place de Mer subdivision is an ocean-front residential development in La Selva
Beach that is substantially built-out. Based on the growth rate of approximately 1% for
the unincorporated areas in the County, LAFCO staff projects that CSA 2’s entire
population in 2040 will be around 174.
LAFCO originally adopted a coterminous sphere of influence for the District in 1988.
A coterminous sphere of influence is identical to the agency’s jurisdictional boundary.
For almost 40 years, the sphere boundary has remained unchanged. LAFCO staff,
along with representatives of CSA 2, do not recommend any changes to the sphere
of influence at this time.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
CSA 2 Place De Mer has a new advanced treatment system that services the
privately-owned residential properties. The system is maintained by the County of
Santa Cruz. Based on staff’s analysis, CSA 2 has 78 connections with 0.4 miles of
sewer lines and 2 pump stations. Annual sewer charges are the District’s primary
source of revenue.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The CSA’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, CSA 2 has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
Comprehensive Sanitation Service and Sphere Review Page 45 of 177
COUNTY SERVICE AREA 5
(SAND DOLLAR/CANON DEL SOL)
District Overview
County Service Area 5 serves the Sand Dollar Beach and Canon Del Sol subdivisions
totaling 640 acres (1.0 square miles). The wastewater system consists of two on-site
interconnected package treatment plants that provide secondary treatment to the 195
parcels. The Sand Dollar treatment plant was constructed in 1967, and the Canon del Sol
treatment plant was constructed in 1982. Figure 18, on page 47, is a vicinity map of the
service area. Appendix C provides a copy of the formation resolution.
Population & Growth
The Sand Dollar/Canon del Sol subdivisions are considered to be built-out. There are no
growth projections available for CSA 5. In general, the Santa Cruz County unincorporated
area is projected to have slow growth over the next fifteen years. Based on the growth
rate of approximately 1% for the unincorporated areas in the County, LAFCO staff
projects that CSA 5’s entire population in 2040 will be around 228. The projected
population for CSA 5 are as follows:
Table 24: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
CSA 5 222 224 226 228 0.86%
Source: AMBAG 2018 Regional Growth Forecast
Services & Operations
CSA 5 has aging package treatment plants that serves single family homes in the Sand
Dollar community and condominiums in the Canon del Sol community. The plants are
maintained by the County of Santa Cruz. Based on the County’s 2022 Sewer System
Management Plan, CSA 5 has 184 connections with 1.15 miles of gravity sewer lines,
0.53 miles of force main lines, and 2 pump stations. Annual sewer charges are the
District’s primary source of revenue.
Infrastructure Summary
CSA 5 operates two separate treatment plants and serves over 200 residents. It currently
has 184 connections and approximately 1.2 miles of sewer line. Table 25 provides an
overview of the type of service and current infrastructure:
Table 25: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Collection and
CSA 5 Secondary 184 2 1.15
Treatment
Infrastructure improvements continue to be an ongoing issue for not only CSA 5, but
rather, most of the sanitation districts throughout the County.
Comprehensive Sanitation Service and Sphere Review Page 46 of 177
Figure 18: CSA 5’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 47 of 177
Sewer Rates
At present, CSA 5’s annual sewer rates derive from the single-family residential units in
the Sand Dollar subdivision and the condominiums in the Canon del Sol subdivision. Each
community has its own sewer rate. Table 26 shows a gradual increase in annual rates
during the last seven years.
Table 26: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Sand
$1,722.00 $1,799.49 $1,844.48 $1,881.37 $1,960.38 $2,056.44 $2,109.91
Dollar
Canon
$1,444.02 $1,509.00 $1,546.73 $1,577.66 $1,643.92 $1,724.47 $2,069.37
del Sol
Pursuant to Santa Cruz County Code Section 4.26, the Director of CDI must annually
compute the benefit assessment/service charge rates for CSAs and submit a report to
the Board of Supervisors describing each parcel of real property receiving the special
benefit and the amount of the charge per CSA for each parcel for the upcoming fiscal
year.
CSA fees are considered sewer rate charges, and any rate increase (except for
preapproved annual Consumer Price Index (CPI) increases) must comply with
Proposition 218 procedures. These procedures state that an increase is approved as long
as it is not protested by 51% of the connected parcel owners. A public hearing must be
held to consider any protests to the proposed increase. The following tables (Tables 27
to 28) depict the change in dollar amount and percentage for each specific zone.
Table 27: Sand Dollar Subdivision’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Sand
$1,722.00 $1,799.49 $1,844.48 $1,881.37 $1,960.38 $2,056.44 $2,109.91
Dollar
Change
$77.49 $44.99 $36.89 $79.01 $96.06 $53.47 $55.45
($)
Change
5% 3% 2% 4% 5% 3% 3%
(%)
Table 28: Canon del Sol Subdivision’s Annual Sewer Rates Review
Average
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20
Change
Canon
$1,444.02 $1,509.00 $1,546.73 $1,577.66 $1,643.92 $1,724.47 $2,069.37
del Sol
Change
$64.98 $37.73 $30.93 $66.26 $80.55 $344.90 $73.77
($)
Change
4% 3% 2% 4% 5% 20% 5%
(%)
Comprehensive Sanitation Service and Sphere Review Page 48 of 177
When comparing the sewer rates with the other sanitation districts analyzed in this report,
CSA 5 is ranked sixth in charges for single family units ($2,109.91/year) and ranked the
second highest in charges for multi-family units ($2,069.37/year). Sewer rate
comparisons are shown in the following figures (Figures 19 and 20).
Figure 19: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00
$2,500.00
$2,109.91
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Figure 20: Annual Sewer Rates for Multi-Family Units
$3,000.00
$2,500.00
$2,069.37
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Single Family $576.66 $586.68 $923.52 $1,411.19 $2,069.37 $2,477.10
Comprehensive Sanitation Service and Sphere Review Page 49 of 177
Finances
This section will highlight the CSA 5’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the CSA 5’s financial performance during the past 12 years
is shown in Tables 31 on page 52.
At the end of Fiscal Year 2023-24, total revenue collected was $410,724, representing a
22% increase from the previous year ($337,129 in FY 22-23). Total expenses for FY
2023-24 were $350,377, which decreased from the previous year by 22% ($448,123 in
FY 22-23). During LAFCO’s last service review analysis in 2019, CSA 5 experienced
annual surpluses in three of the five fiscal years (FY 13-14 to FY 17-18). However, during
this service review cycle, CSA 5 experienced three annual deficits in the past six years
(FY 18-19 to FY 23-24), as shown in Figure 21 below. Based on the recently adopted
budget and past performances, LAFCO staff believes that the fluctuating trend will
continue unless additional revenue sources are collected or annual expenses are reduced
to maintain sustainability and consistency in future fiscal performances.
Comprehensive Sanitation Service and Sphere Review Page 50 of 177
200,152$
315,432$
242,652$
564,572$
100,462$
353,342$
676,172$
977,052$
384,182$
641,313$
052,192$
071,033$
027,503$
283,082$
537,903$ 396,313$ 788,403$
783,572$
921,733$
321,844$
427,014$
773,053$
744,583$
582,563$
Figure 21: Statement of Revenues & Expenditures
$500,000
$450,000
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$-
FY 13-14FY 14-15FY 15-16FY 16-17FY 17-18FY 18-19FY 19-20FY 20-21FY 21-22FY 22-23FY 23-24FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
CSA Revenues
CSA 5’s primary source of revenue is from Charges for Services. In FY 2023-24, the
District received revenue from two different sources: Charges for Services ($342,721)
and Interest and Investment Income ($13,203). On average, the District receives
approximately $290,000 each year in service fees. Table 29 highlights the total revenue
received since 2018.
Table 29: Total Revenue (FY 18-19 to FY 23-24)
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
Charges for
$285,556 $299,898 $307,397 $313,544 $326,713 $342,721
Services
Interest Investment
$5,694 $5,822 $2,338 -$8,657 $10,416 $13,203
Income
Total Revenue $291,250 $305,720 $309,735 $304,887 $337,129 $410,724
CSA Expenditures
CSA 5’s total expenditures can be categorized into two budgetary groups: Services &
Supplies and Depreciation & Amortization. The figure below depicts how funding is
distributed by category. The District’s primary expenditure is associated with operational
and management costs, under Services and Supplies.
Figure 22: FY 2023-24 Expenditure Breakdown
Depreciation and Amortization
$18,735 (5%)
Services and Supplies
$331,642 (95%)
Comprehensive Sanitation Service and Sphere Review Page 51 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $746,000. The following
table highlights the Fund Balance from 2018 to 2025. As Table 30 shows below, the
District has experienced fluctuation in total reserves each year. While the District has
seen consecutive years of surpluses, it also gets affected by unexpected expenditures or
costly repairs/replacement projects. A full review of the District’s revenues and
expenditures from FY 2013-14 to FY 24-25 is shown on Table 31.
Table 30: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $749,482 $774,820 $770,862 $800,362 $689,3368 $749,716 $769,878
Change in ($) from
$25,338 -$3,958 $29,500 -$110,994 $60,348 $20,162
previous year
Change in (%) from
3% -1% 4% -14% 9% 3%
previous year
Table 31: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 2 49,989 $ 255,488 $ 2 62,640 $ 2 69,464 $ 2 77,507 $ 2 85,556 $ 2 99,898 $ 3 07,397 $ 3 13,544 $ 3 26,713 $ 3 42,721 $ 3 80,447
Intergovernmental $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Interest and Investment Income $ 1,013 $ 7 54 $ 1,361 $ 2,212 $ 3,976 $ 5,694 $ 5,822 $ 2,338 $ (8,657) $ 10,416 $ 1 3,203 $ 5,000
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
St-Homeowners Prop Tax Relief $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Insurance Proceeds $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 54,800 $ -
Gain on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Revenue $ 2 51,002 $ 256,242 $ 264,001 $ 271,676 $ 281,483 $ 291,250 $ 305,720 $ 309,735 $ 304,887 $ 337,129 $ 410,724 $ 385,447
EXPENDITURES
Services and Supplies $ 1 99,596 $ 240,547 $ 2 08,435 $ 2 17,457 $ 2 77,931 $ 2 98,667 $ 2 55,263 $ 2 94,958 $ 2 56,652 $ 4 29,388 $ 3 31,642 $ 3 46,550
Depreciation and Amortization $ 34,917 $ 34,918 $ 34,918 $ 3 3,322 $ 3 1,503 $ 31,503 $ 25,119 $ 1 8,735 $ 18,735 $ 18,735 $ 18,735 $ 1 8,735
Loss on Disposal of Capital Assets $ - $ - $ - $ - $ 3,712 $ - $ - $ - $ - $ - $ - $ -
Total Expenditure $ 2 34,513 $ 275,465 $ 243,353 $ 250,779 $ 313,146 $ 330,170 $ 280,382 $ 313,693 $ 275,387 $ 448,123 $ 350,377 $ 365,285
Surplus/(Deficit) $ 1 6,489 $ (19,223) $ 2 0,648 $ 20,897 $ (31,663) $ (38,920) $ 2 5,338 $ ( 3,958) $ 2 9,500 $ (110,994) $ 6 0,347 $ 20,162
Net Position - Beginning $ 7 81,254 $ 797,743 $ 7 78,520 $ 7 99,168 $ 8 20,065 $ 7 88,402 $ 7 49,482 $ 7 74,820 $ 7 70,862 $ 8 00,362 $ 6 89,369 $ 7 49,716
Net Position - Ending $ 7 97,743 $ 778,520 $ 7 99,168 $ 8 20,065 $ 7 88,402 $ 7 49,482 $ 7 74,820 $ 7 70,862 $ 8 00,362 $ 6 89,368 $ 7 49,716 $ 7 69,878
RESERVES
Capital Replacement Reserve $ 57,832 $ 1 34,167 $ 1 69,194 $ 1 94,667 $ 1 94,667 $ 2 31,196 $ 1 61,484 $ 1 70,133 $ 3 05,291 $ 356,819 $ 2 71,638 $ 2 69,466
Comprehensive Sanitation Service and Sphere Review Page 52 of 177
Governance
County Service Area 5 is a dependent special district governed by the County Board of
Supervisors and managed by the Public Works Department. The current Board is as
follows:
Table 32: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors generally meets twice a month on a Tuesday in the Board of
Supervisors’ Chambers, 701 Ocean Street, Room 525. Meetings generally begin at
9:00am. Public notice is provided through posting. The County contracts for independent
audits.
The County Community Development & Infrastructure Public Works Division is
responsible for the administration, engineering, maintenance, emergency response and
construction of all County sanitation services. The department also manages various
Board-governed special districts and CSAs. The Sanitation Operations unit is one of six
organizational units within the Special Services Division of Public Works and provides
operation and maintenance services to County sanitation districts and CSAs. Sanitation
operations employees work in all Districts and CSAs. Each sanitation district is governed
according to its specific code of regulations. The Districts’ codes are very similar, and
some sections are adopted by reference from the Santa Cruz County Sanitation District
Code. CSAs are governed according to the Santa Cruz County Code of Regulations. Most
of the County Code pertaining to sanitary sewer collection systems is adopted by
reference from the SCCSD Code.
Comprehensive Sanitation Service and Sphere Review Page 53 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the CSA’s website (even though said law only applies to independent
special districts). Table 33 summarizes staff’s findings on whether the website meets the
statutory requirements. At present, the CSA does meet the statutory requirements set
under SB 929 and SDLF’s website transparency criteria. LAFCO appreciates the recent
efforts by the County to revamp the organization’s website, which included a new
webpage specifically for the sewer agencies governed and managed by the County.
Table 33: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 54 of 177
Opportunities & Challenges
County Service Area 5 is significantly affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Capital Improvement Plan
There is no specific capital improvement plan for CSA 5. The County has a countywide
CIP to address the replacement of the aging sewer system, however, CSA 5 lacks funds
to make all the improvements. The County of Public Works continually seek grant or loan
funding to help finance these improvements.
LAFCO Staff Recommendation: Currently CSA 5 is included in the countywide capital
improvement plan. The County should consider if developing specific capital improvement
plans that cover the sanitation districts managed and operated by the Public Works
Department – Davenport, Freedom, Santa Cruz County Sanitation Districts, and CSAs 2,
5, 7, 10, and 20 have any added benefit compared to including it with the overall County
CIP. If the benefit outweighs the cost burden of preparing the specific CIPs, the County
should institute this practice.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following:
• Sanitary Sewer Spills are prohibited, and
• All Sanitary Sewer Spills, with the exception of Private Sewer Lateral Discharge
(PLSDs), irrespective of size, must be reported to the State Water Board electronically
using the California Integrated Water Quality System, and the Districts/CSAs must
prepare and implement a Sewer System Management Plan (SSMP).
In 2025, the County adopted a Sewer System Management Plan to cover the
management, operation and maintenance, design, construction and emergency response
of the Davenport Sanitation District, Freedom Sanitation District, Santa Cruz County
Sanitation District and three county service areas: CSAs 5, 7 and 10.
Infrastructure Deficiencies
The Sand Dollar and Canon Del Sol subdivisions each have a small onsite wastewater
treatment plant system that treat the domestic water from the surrounding residential
homes. In 2019, it was determined that the treatment plants each required additional
maintenance to address failing equipment. Due to the unanticipated hours to operate the
treatment plants, the Board of Supervisors transferred funds from the Capital Reserves
to Maintenance and Operations for Sand Dollar and Canon Del Sol. A total of $25,000
was required from Sand Dollar Capital Reserves and $25,000 was required from Canon
Del Sol Capital Reserves to cover maintenance and operation costs of each treatment
plant for the remainder of the fiscal year.
Comprehensive Sanitation Service and Sphere Review Page 55 of 177
In winter 2023, a retaining wall in CSA 5 – Canon del Sol’s required emergency repairs.
A portion of the retaining wall surrounding the treatment plant was failing. To cover the
emergency repairs, it was necessary to increase the service charges for CSA 5 Canon
del Sol. Infrastructure improvements continue to be an ongoing issue for not only CSA
5, but rather, most of the sanitation districts throughout the County. The County may
consider adopting a long-term capital improvement plan for CSA 5 to ensure scheduled
and unforeseen repairs and replacements are adequately funded.
Sphere of Influence
LAFCO originally adopted a coterminous sphere of influence for the District in 1988. A
coterminous sphere of influence is identical to the agency’s jurisdictional boundary. For
the past 30 years, the sphere boundary has remained unchanged. LAFCO staff, along
with representatives of CSA 5, do not recommend any changes to the sphere of influence
at this time. Figure 23 on page 57 shows the current sphere of influence boundary for
CSA 5.
Comprehensive Sanitation Service and Sphere Review Page 56 of 177
Figure 23: CSA 5’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 57 of 177
District Summary
County Service Area 5 (Sand Dollar/Canyon del Sol)
California Government Code, section 25210.1 et seq.
Formation
(County Service Area Law)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 1.50 full-time employees (approximately)
Facilities Package Treatment Plant; 2 lift stations; 184 connections
District Area 640 acres (1.0 square miles)
Coterminous with District (i.e. no sphere beyond existing
Sphere of Influence
jurisdictional boundary)
Total Revenue = $385,447
FY 2024-25 Budget Total Expenditure = $365,285
Projected Net Position (Beginning Balance) = $749,716
Mailing Address: 701 Ocean Street, Room 410 Santa Cruz CA
95060
Phone Number: (831) 454-2160
Email Address: Matt.Machado@santacruzcountyca.gov
Contact Information
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
CSA Liaisons: Bob Carpenter bob@cabrenee.com
Jennifer Carpenter (650-941-4774)
King Management – Amy King (475-9100)
The Board regularly meets on most Tuesdays in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings
generally begin at 9:00 am.
The CSA does not have a published mission statement. However,
Mission Statement their mission aligns with the published mission statement for the
Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 58 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Sand Dollar/Canon del Sol subdivisions are considered to be built-out. There are
no growth projections available for CSA 5. In general, the Santa Cruz County
unincorporated area is projected to have slow growth over the next fifteen years.
Based on the growth rate of approximately 1% for the unincorporated areas in the
County, LAFCO staff projects that CSA 5’s entire population in 2040 will be around
228.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within CSA 5.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
County Service Area 5 operates two separate treatment plants and serves over 200
residents. The Sand Dollar treatment plant was constructed in 1967, and the Canon
del Sol treatment plant was constructed in 1982. It currently has 184 connections and
approximately 1.2 miles of sewer line.
4. Financial ability of agencies to provide services.
County Service Area 5’s annual sewer rates derive from the single-family residential
units in the Sand Dollar area and the condominiums in Canon del Sol area. Each
community has its own sewer rate. The CSA has experienced an annual deficient in
three out of the last six fiscal years. As of June 30, 2024, CSA 5 is operating with a
net position of approximately $750,000.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The County currently has a countywide capital improvement plan and a specific capital
improvement plan for the Santa Cruz County Sanitation District. Additionally, the
County has adopted a Sewer System Management Plan. However, CSA 5 does not
have any current or proposed sewer-related capital improvement projects scheduled
at this time.
Comprehensive Sanitation Service and Sphere Review Page 59 of 177
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
The Sand Dollar and Canon del Sol subdivisions are substantially built-out. Based on
the growth rate of approximately 1% for the unincorporated areas in the County,
LAFCO staff projects that CSA 5’s entire population in 2040 will be around 228.
LAFCO originally adopted a coterminous sphere of influence for CSA 5 in 1988. A
coterminous sphere of influence is identical to the agency’s jurisdictional boundary.
For almost 40 years, the sphere boundary has remained unchanged. LAFCO staff,
along with representatives of CSA 5, do not recommend any changes to the sphere
of influence at this time.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
CSA 5 has an aging package treatment plant that serves single family homes in the
Sand Dollar community and condominiums in the Canon del Sol community. The plant
is maintained by the County of Santa Cruz. Based on the County’s 2022 Sewer
System Management Plan, CSA 5 has 184 connections with 1.15 miles of gravity
sewer lines, 0.53 miles of force main lines, and 2 pump stations. Annual sewer
charges are the District’s primary source of revenue.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The CSA’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, CSA 5 has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
The CSA’s principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 60 of 177
COUNTY SERVICE AREA 7
(BOULDER CREEK)
District Overview
County Service Area 7 serves residential housing and one commercial business within
the Boulder Creek Country Club subdivision. The service area includes 192 acres (0.3
square miles) and has an estimated population of 640 within 364 parcels. The wastewater
system is a full treatment plant offering secondary treatment services with primary
disposal via a community leach field. The wastewater treatment plant was constructed in
the 1970s. Figure 24, on page 62, is a vicinity map of the service area. Appendix D
provides a copy of the formation resolution. In March 2024, the County created Zones 1
and 2 within CSA 7 to address the transfer of sewer responsibilities from the failing
privately-owned Big Basin Water Company (BBWC). Zone 1 represents the historical
service area of CSA 7 while Zone 2 represents the newly added Fallen Leaf community
(previously serviced by BBWC). Zone 2 is not analyzed in this report since it is a new
zone; however, a more detailed analysis will be included in the next service review cycle.
Appendix E provides a copy of the formation resolution for the two zones.
Population & Growth
The Boulder Creek Country Club subdivision is substantially built-out. There are no
growth projections available for CSA 7. In general, the Santa Cruz County unincorporated
area is projected to have slow growth over the next fifteen years. Based on the growth
rate of approximately 1% for the unincorporated areas in the County, LAFCO staff
projects that CSA 7’s entire population in 2040 will be around 679. The projected
population for CSA 7 are as follows:
Table 34: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
CSA 7 662 668 674 679 0.86%
Source: AMBAG 2018 Regional Growth Forecast
Services & Operations
CSA 7 Boulder Creek has a wastewater collection and treatment plant that treats the
domestic wastewater from the Boulder Creek Country Club and surrounding houses. The
all-in-one wastewater treatment plant consists of four major processes: pre-aeration,
aeration tank, secondary clarifier tank and a digester, and the treated effluent is
discharged to leach fields. Based on the County’s 2025 Sewer System Management Plan,
CSA 7 has 254 connections with 3.0 miles of gravity sewer lines, 1.27 miles of force main
lines, and 5 pump stations. Annual sewer charges are the CSA’s primary source of
revenue. The original treatment plant was constructed in 1978 and has a design capacity
of 104,000 gallons per day (gpd). The plant was constructed to accommodate flows from
the Boulder Creek Country Club development, totaling 260 residences and a commercial
establishment. This is an activated sludge nitrification/dentification process, which
includes an effluent discharge line, emergency generator, and one grinder. The facility
also contains a small laboratory for performing basic analyses, such as pH levels and
temperatures.
Comprehensive Sanitation Service and Sphere Review Page 61 of 177
Figure 24: CSA 7’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 62 of 177
Infrastructure Summary
CSA 7 (Zone 1) operates a collection and treatment plant and serves over 600 residents.
It currently has 254 connections and approximately 4 miles of sewer line. Table 35
provides an overview of the type of service and current infrastructure:
Table 35: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Collection,
CSA 7 Secondary 254 5 3.0
Treatment
CDI has indicated that the current infrastructure is aging, deteriorating, and in need of
repair. The wastewater treatment plant currently requires approximately $1.2M in repairs
(of which $405,000 has been grant funded). Another $200,000 is needed in the short
term to line manholes and perform spot repairs of the sewer mains.
Replacement/rehabilitation is also needed at some of the CSA’s sewer pump stations and
sewer mains. In August 2020, most of the Boulder Creek WWTP and surrounding
structures were damaged as a result of the CZU fire. Emergency repairs were made and
included a new lab/office, new lift stations (Fallen Leaf and Lake Avenue), a new standby
generator room, electrical room, a new blower building and included partial repairs to the
digester. The cost of the repairs was over $3.8 million and were funded by the County
insurance proceeds, FEMA reimbursements and the CSAs capital reserves.
Sewer Rates
At present, CSA 7’s annual sewer rates derive from three areas: Single Family Dwelling,
Condominiums, and Commercial. Each area has its own sewer rate. Table 36 shows a
gradual increase in annual rates during the last seven years.
Table 36: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Single Family $2,051.50 $2,143.82 $2,240.29 $2,285.10 $2,381.07 $2,497.74 $2,747.51
Condos $1,849.59 $1,932.81 $2,019.80 $2,060.20 $2,146.72 $2,251.91 $2,477.10
Commercial
$1,415.45 $1,479.15 $1,545.71 $1,576.62 $1,642.84 $1,723.34 $1,895.67
Flat Rate
Commercial
$6.47 $6.76 $7.06 $7.20 $7.50 $7.87 $8.65
Usage Charge
Note: Additional Charge is for Commercial usage only; based on Hundred Cubic Feet of Water (HCF)
Pursuant to Santa Cruz County Code Section 4.26, the Director of CDI must annually
compute the benefit assessment/service charge rates for CSAs and submit a report to
the Board of Supervisors describing each parcel of real property receiving the special
benefit and the amount of the charge per CSA for each parcel for the upcoming fiscal
year. CSA fees are considered sewer rate charges, and any rate increase (except for
preapproved annual Consumer Price Index (CPI) increases) must comply with
Proposition 218 procedures. These procedures require that an increase is approved by
at least half of the votes cast by the property owners, with the votes weighted according
to the amount of the proposed assessment of each parcel. Furthermore, a public hearing
must be held to consider any protests to the proposed increase.
The following tables (Tables 37 to 39) depict the change in dollar amount and percentage
for each specific zone.
Comprehensive Sanitation Service and Sphere Review Page 63 of 177
Table 37: Single Family Dwelling’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Single
$2,051.50 $2,143.82 $2,240.29 $2,285.10 $2,381.07 $2,497.74 $2,747.51
Family
Change
$92.32 $96.47 $44.81 $95.97 $116.67 -$20.64 $62.73
($)
Change
5% 4% 2% 4% 5% -1% 3%
(%)
Table 38: Condominium’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Condos $1,849.59 $1,932.81 $2,019.80 $2,060.20 $2,146.72 $2,251.91 $2,477.10
Change
$83.22 $86.99 $40.40 $86.52 $105.19 $495.60 $103.31
($)
Change
4% 5% 2% 4% 5% 22% 5%
(%)
Table 39: Commercial’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Commercial $1,415.45 $1,479.15 $1,545.71 $1,576.62 $1,642.84 $1,723.34 $1,895.67
Change
$63.70 $66.56 $30.91 $66.22 $80.50 $172.33 $60.24
($)
Change
5% 4% 2% 4% 5% 10% 4%
(%)
When comparing the sewer rates with the other sanitation districts analyzed in this report,
CSA 7 is ranked the third highest in charges for single family units ($2,747.51/year) and
ranked the highest in charges for multi-family units ($2,477.10/year). Using a general
business with a water usage of 192 hundred cubic feet of annual water usage, CSA 7’s
commercial charges are ranked the third highest ($3,642.29/year). Sewer rate
comparisons are shown in the following figures (Figures 25 to 27).
Figure 25: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00 $2,747.51
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Comprehensive Sanitation Service and Sphere Review Page 64 of 177
Figure 26: Annual Sewer Rates for Multi-Family Units
$3,000.00
$2,477.10
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Single Family $576.66 $586.68 $923.52 $1,411.19 $2,069.37 $2,477.10
Figure 27: Annual Sewer Rates for Commercial Sites
$7,000.00
$6,215.35
$6,000.00
$4,823.00
$5,000.00
$4,000.00
$3,642.29
$2,872.56
$3,000.00
$2,000.00 $1,756.66
$1,000.00
$152.88
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Footnote: Salsipuedes Sanitary District data only includes flat rate and does not include the average water
use (HCF) and its associated HCF rate when compared to the other agencies.
Comprehensive Sanitation Service and Sphere Review Page 65 of 177
Finances
This section will highlight the CSA’s audited financial performance during the most recent
fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available. A
comprehensive analysis of the CSA’s financial performance during the past 12 years is
shown in Table 42 on page 68.
At the end of Fiscal Year 2023-24, total revenue collected was $568,219, representing a
6% increase from the previous year ($536,587 in FY 22-23). Total expenses for FY 2023-
24 were $608,415, which increased from the previous year by 20% ($505,829 in FY 22-
23). During LAFCO’s last service review analysis in 2019, CSA 7 experienced annual
surpluses in all five fiscal years (FY 13-14 to FY 17-18). However, during this service
review cycle, CSA 7 experienced two non-consecutive annual deficits in the past six years
(FY 18-19 to FY 23-24), as shown in Figure 28 below. Based on the recently adopted
budget and past performances, LAFCO staff believes that CSA 7 will continue to operate
effectively due to its stable revenue stream and stagnant expenditures.
Comprehensive Sanitation Service and Sphere Review Page 66 of 177
558,244$ 917,254$ 498,764$ 583,284$ 177,615$ 467,235$ 656,555$
607,030,1$
$4,804,726
606,992$ 902,333$ 154,273$ 527,213$ 347,583$ 691,645$ 760,993$ 148,134$ 910,274$ 785,635$ 928,505$ 912,865$ 514,806$
623,080,1$
812,856$
Figure 28: Statement of Revenues & Expenditures
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$-
FY 13-14FY 14-15FY 15-16FY 16-17FY 17-18FY 18-19FY 19-20FY 20-21FY 21-22FY 22-23FY 23-24FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
CSA Revenues
CSA 7’s primary source of revenue is from Charges for Services. In FY 2023-24, Charges
for Services was $592,056. On average, the District receives approximately $505,000
each year in service fees. Table 40 highlights the total revenue received since 2018.
Table 40: Total Revenue (FY 18-19 to FY 23-24)
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
Charges for
$510,949 $532,320 $522,963 $526,406 $548,793 $592,056
Services
Interest &
Investment $21,815 $23,336 $7,743 $(4,374) $(16,003) $(23,837)
Income
St-Natural
Disaster - - - $18,985 - -
Assistance
FED-FEMA - - - $133,906 $3,797 -
Insurance
- - $500,000 $4,129,803 - -
Proceeds
Total Revenue $532,764 $555,656 $1,030,706 $4,804,726 $536,587 $568,219
CSA Expenditures
CSA 7’s total expenditures can be categorized into 2 budgetary groups: Services &
Supplies and Depreciation & Amortization. The figure below depicts how funding is
distributed by category. The District’s primary expenditure is associated with operational
and management costs, under Services and Supplies.
Figure 29: FY 2023-24 Expenditure Breakdown
Depreciation and Amortization
$160,861 (26%)
Services and Supplies
$447,554 (74%)
Comprehensive Sanitation Service and Sphere Review Page 67 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $6.8 million. The following
table highlights the Fund Balance from 2018 to 2025. As Table 41 shows below, the
District has generally experienced an increase in total reserves each year. On average,
total reserves have increased by approximately $558,000 or 25% since FY 2018-19. A
full review of the District’s revenues and expenditures from FY 2013-14 to FY 24-25 is
shown on Table 42.
Table 41: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $1,750,132 $1,906,721 $2,505,584 $6,838,291 $6,869,050 $5,690,019 $7,253,178
Change in ($) from
$156,589 $598,863 $4,332,707 $30,759 -$1,179,031 $1,563,159
previous year
Change in (%) from
9% 31% 173% 0.05% -17% 27%
previous year
Table 42: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 4 39,060 $ 4 49,290 $ 4 61,736 $ 4 74,870 $ 4 91,016 $ 5 10,949 $ 5 32,320 $ 5 22,963 $ 5 26,406 $ 5 48,793 $ 5 92,056 $ 6 55,014
Other Revenue $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 4 05,312
Intergovernmental $ - $ - $ - $ - $ 11,258 $ - $ - $ - $ - $ - $ - $ 20,000
Interest and Investment Income $ 3 ,795 $ 3 ,429 $ 6 ,158 $ 7 ,515 $ 12,238 $ 21,815 $ 23,336 $ 7 ,743 $ (4,374) $ (16,003) $ (23,837) $ -
St-Natural Disaster Assistance $ - $ - $ - $ - $ - $ - $ - $ - $ 18,985
FED-FEMA $ - $ - $ - $ - $ - $ - $ - $ - $ 133,906 $ 3 ,797 $ - $ -
Insurance Proceeds $ - $ - $ - $ - $ - $ - $ - $ 5 00,000 $ 4,129,803
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Gain on Disposal of Capital Assets $ - $ - $ - $ - $ 2,259 $ - $ - $ - $ - $ - $ - $ -
Total Revenue $ 4 42,855 $ 4 52,719 $ 4 67,894 $ 4 82,385 $ 5 16,771 $ 532,764 $ 5 55,656 $ 1,030,706 $ 4,804,726 $ 5 36,587 $ 5 68,219 $ 1,080,326
EXPENDITURES
Services and Supplies $ 2 31,660 $ 2 70,700 $ 3 09,942 $ 2 45,782 $ 3 12,079 $ 4 75,679 $ 3 62,898 $ 2 46,335 $ 4 53,057 $ 3 68,618 $ 4 47,554 $ 4 70,319
Depreciation and Amortization $ 67,946 $ 62,509 $ 62,509 $ 66,943 $ 73,664 $ 70,517 $ 36,169 $ 36,169 $ 18,962 $ 1 37,211 $ 1 60,861 $ 1 87,899
Loss on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ 149,337 $ - $ - $ - $ -
Total Expenditure $ 2 99,606 $ 3 33,209 $ 3 72,451 $ 3 12,725 $ 3 85,743 $ 546,196 $ 3 99,067 $ 4 31,841 $ 4 72,019 $ 5 05,829 $ 6 08,415 $ 6 58,218
Surplus/(Deficit) $ 1 43,249 $ 1 19,510 $ 95,443 $ 1 69,660 $ 1 31,028 $ ( 13,432) $ 1 56,589 $ 5 98,865 $ 4,332,707 $ 30,758 $ (40,196) $ 4 22,108
Net Position - Beginning $ 1,104,674 $ 1,247,923 $ 1,367,433 $ 1,462,876 $ 1,632,536 $ 1,763,564 $ 1,750,132 $ 1,906,719 $ 2,505,584 $ 6,838,292 $ 6 ,869,050 $ 6,828,854
Net Position - Ending $ 1,247,923 $ 1,367,433 $ 1,462,876 $ 1,632,536 $ 1,763,564 $ 1,750,132 $ 1,906,721 $ 2,505,584 $ 6,838,291 $ 6,869,050 $ 5 ,690,019 $ 7,253,178
RESERVES
Capital Replacement Reserve $ 108,311 $ 330,621 $ 399,283 $ 627,805 $ 627,805 $ - $ 200,000 $ 931,035 $ 3,056,686 $ - $ 3 27,767 $ -
Reserves from FY23-24 were used to rebuild the plant after the CZU fire and funds that
could have been applied to the reserves in FY24-25 were set aside for the replacement
of the equalization tank. The County plans to start building the reserves account back up
in FY26-27.
Comprehensive Sanitation Service and Sphere Review Page 68 of 177
Governance
County Service Area 7 is a dependent special district governed by the County Board of
Supervisors and managed by the Public Works Department. The current Board is as
follows:
Table 43: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors generally meets twice a month on a Tuesday in the Board of
Supervisors’ Chambers, 701 Ocean Street, Room 525. Meetings generally begin at
9:00am. Public notice is provided through posting. The County contracts for independent
audits.
The County Community Development & Infrastructure Public Works Division is
responsible for the administration, engineering, maintenance, emergency response and
construction of all County sanitation services. The department also manages various
Board-governed special districts and CSAs. The Sanitation Operations unit is one of six
organizational units within the Special Services Division of Public Works and provides
operation and maintenance services to County sanitation districts and CSAs. Sanitation
operations employees work in all Districts and CSAs. Each sanitation district is governed
according to its specific code of regulations. The Districts’ codes are very similar, and
some sections are adopted by reference from the Santa Cruz County Sanitation District
Code. CSAs are governed according to the Santa Cruz County Code of Regulations. Most
of the County Code pertaining to sanitary sewer collection systems is adopted by
reference from the SCCSD Code.
Comprehensive Sanitation Service and Sphere Review Page 69 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the CSA’s website (even though said law only applies to independent
special districts). Table 44 summarizes staff’s findings on whether the website meets the
statutory requirements. At present, the CSA does meet the statutory requirements set
under SB 929 and SDLF’s website transparency criteria. LAFCO appreciates the recent
efforts by the County to revamp the organization’s website, which included a new
webpage specifically for the sewer agencies governed and managed by the County.
Table 44: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 70 of 177
Opportunities & Challenges
County Service Area 7 is significantly affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Capital Improvement Plan
CSA 7 is part of the County’s 2025/2030 Capital Improvement Program. The 2025/2030
Capital Improvement Program (CIP) presents a five-year financing implementation plan
for capital improvements within the unincorporated County; Parks, Open Space and
Cultural Services; and County Facility projects located Countywide. The CIP is an
outgrowth of cooperative planning, programming and financing efforts through the County
Administrative Office and by the County’s land use departments including Planning,
Public Works, and Parks, Open Space and Cultural Services, as well as non-land use
departments including the Health Services Agency, General Services Department,
Probation, and the Sheriff’s Department. Unprogrammed road, roadside, sanitation, flood
control, parks, and recycling and solid waste projects (which funding is not anticipated for
in the coming five years, or longer, and meets requirements of unincorporated County
service level needs at build-out under the 1994 General Plan) are also identified in the
CIP. The Boulder Creek Wastewater Treatment Plant Equalization Tank and Mixer
Replacement project is in the 2025/2030 CIP. Replacement of the equalization tank is
planned in FY26-27. It is LAFCO’s understanding that funding plan has changed for the
EQ Tank project. The project is fully funded with IRWM Bond Funds, County Bonds, and
CSA 7 funds (no additional loan is required). The County continuously seeks grant or loan
funding to help finance these improvements.
LAFCO Staff Recommendation: Currently CSA 7 is included in the countywide capital
improvement plan. The County should consider if developing specific capital improvement
plans that cover the sanitation districts managed and operated by the Public Works
Department – Davenport, Freedom, Santa Cruz County Sanitation Districts, and CSAs 2,
5, 7, 10, and 20 have any added benefit compared to including it with the overall County
CIP. If the benefit outweighs the cost burden of preparing the specific CIPs, the County
should institute this practice.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following: (1) Sanitary Sewer
Spills are prohibited, and (2) All Sanitary Sewer Spills, with the exception of Private Sewer
Lateral Discharge (PLSDs), irrespective of size, must be reported to the State Water
Board electronically using the California Integrated Water Quality System, and the
Districts/CSAs must prepare and implement a Sewer System Management Plan (SSMP).
In 2025, the County adopted a Sewer System Management Plan to cover the
management, operation and maintenance, design, construction and emergency response
of the Davenport Sanitation District, Freedom Sanitation District, Santa Cruz County
Sanitation District and three county service areas: CSAs 5, 7 and 10.
Comprehensive Sanitation Service and Sphere Review Page 71 of 177
Infrastructure Deficiencies
During the wet winter, CSA 7 experienced high influent flows due to infiltration in the aging
sewer system and the treatment plant could not treat the high volume of wastewater,
requiring Sanitation Operations to remove wastewater from the equalization tank. As a
result of the unforeseen costs to haul wastewater from the equalization tank by Sanitation
Operations staff, the Board of Supervisors recently transferred funds from the Structure
Upgrades to operations in the Boulder Creek Treatment Plant. A total of $30,000 was
required to cover the maintenance and operation of the wastewater treatment plant for
the remainder of the fiscal year. Replacement of the equalization tank is planned in FY26-
27. The Public Works Department has acknowledged that CSA 7 lacks funds to make
all the necessary improvements. Infrastructure improvements continue to be an ongoing
issue for not only CSA 7, but rather, most of the sanitation districts throughout the County.
The County may consider adopting a long-term capital improvement plan for CSA 7 to
ensure scheduled and unforeseen repairs and replacements are adequately funded.
The Big Basin WWTP sustained significant equipment damage during the CZU Complex
Fire in 2020. The WWTP remained inoperable until August 2023. In 2024, CDI initiated
the transitioning of the BB WWTP from a private system to a public system to be operated
by the County of Santa Cruz. The Big Basin WWTP serves 32 parcels in the Fallen Leaf
neighborhood. In April 2024, the Fallen Leaf neighborhood voted to approve the
formation of CSA 7 Zone 2. CDI began to maintain the WWTP in July 2024 and since
August 2024, the WWTP has met State issued permit regulations.
Sphere of Influence
LAFCO originally adopted a sphere of influence for CSA 7 back in 1987 and has remained
the since then, as shown in Figure 30 on page 73. The Commission, at that time, adopted
a sphere boundary that excluded 3 parcels (APNs 083-273-04, -05, and -06). This area,
located outside the sphere of influence but within CSA 7, is approximately 64 acres,
undeveloped, and mostly open terrain. Today, the excluded area is mostly undeveloped,
but the original parcels have now been split into six parcels, as shown in Table 45.
Table 45: Parcels Within CSA 7 but Excluded from Sphere Boundary
APNs Land Use Designation Zoning Description Acres
083-273-07 R-R 061-HOMESITE/1-4.9 ACRES 2.503
083-273-03 R-R 060-HOMESITE/< 1 ACRE 0.895
083-273-05 R-R 061-HOMESITE/1-4.9 ACRES 2.452
083-273-04 R-R 053-20- 49.9 ACRE/RURAL 29
083-273-06 R-MT 060-HOMESITE/< 1 ACRE 0.984
083-251-76 O-C; R-MT 063-HOMESITE/20-49.9 ACRES 27.7
Proposed Sphere Amendment
Since the excluded area is designated as residential use and is already within the
District’s jurisdictional boundary, staff is recommending that the sphere be amended to
be coterminous with the District’s current service area. The sphere amendment would
reflect the District’s jurisdiction while also clarifying who is the most logical provider of
sewer service in the Big Basin community. Figure 31 on page 74 shows the proposed
sphere of influence boundary for CSA 7. It is important to note that County staff is currently
working with LAFCO to analyze the potential future boundary changes under the
proposed sphere amendment.
Comprehensive Sanitation Service and Sphere Review Page 72 of 177
Figure 30: CSA 7’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 73 of 177
Figure 31: CSA 7’s Proposed Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 74 of 177
District Summary
County Service Area 7 (Boulder Creek Country Club)
California Government Code, section 25210.1 et seq.
Formation
(County Service Area Law)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community Development
Contact Person
and Infrastructure
Employees 1.50 full-time employee (approximately)
Facilities Collection and Treatment Plant; 5 pump stations; 254 connections
District Area 153.6 acres (0.24 square miles)
Smaller than the District (i.e. sphere excludes a portion of the
Sphere of Influence
existing jurisdictional boundary)
Total Revenue = $1,080,326
FY 2024-25 Budget Total Expenditure = $658,218
Projected Net Position (Beginning Balance) = $6,828,854
Mailing Address: 701 Ocean Street, Room 410, Santa Cruz CA
95060
Phone Number: (831) 54-2160
Email Address: Matt. Machado@santacruzcountyca.gov
Contact Information Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
CSA Liaisons:
Zone1: William Aragona (831-338-2111)
Zone 1: Greg Schlaman (408-439-6571)
Zone 2: Julie Wuest juliewuest@comcast.net
Zone 2: Antonia & Chris Bradford antonia.bradford.slv@gmail.com
The Board regularly meets on most Tuesdays in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings generally
begin at 9:00 am.
The CSA does not have a published mission statement. However,
Mission Statement their mission aligns with the published mission statement for the
Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 75 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Boulder Creek Country Club is substantially built-out. There are no growth
projections available for CSA 7. In general, the Santa Cruz County unincorporated
area is projected to have slow growth over the next fifteen years. Based on the growth
rate of approximately 1% for the unincorporated areas in the County, LAFCO staff
projects that CSA 7’s entire population in 2040 will be around 679.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within CSA 7.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
CSA 7 Boulder Creek has a wastewater collection and treatment plant that treats the
domestic wastewater from the Boulder Creek Country Club and surrounding houses.
The all-in-one wastewater treatment plant consists of an equalization tank, aeration
tank, and a clarifier to remove solids, and the treated effluent is discharged to leach
fields. Based on the County’s 2022 Sewer System Management Plan, CSA 7 has 254
connections with 3.0 miles of gravity sewer lines, 1.27 miles of force main lines, and
6 pump stations. Annual sewer charges are the District’s primary source of revenue.
4. Financial ability of agencies to provide services.
County Service Area 7’s financial ability seems to be stable. The CSA has successfully
kept costs below its revenue stream in most years since 2013. As of June 30, 2024,
CSA 7 is operating with a net position of approximately $6.8 million.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The County currently has a countywide capital improvement plan and a specific capital
improvement plan for the Santa Cruz County Sanitation District. Additionally, the
County has adopted a Sewer System Management Plan. However, CSA 7 does not
have any current or proposed sewer-related capital improvement projects scheduled
at this time.
Comprehensive Sanitation Service and Sphere Review Page 76 of 177
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
CSA 7 Boulder Creek has a wastewater collection and treatment plant that treats the
domestic wastewater from the Boulder Creek Country Club and surrounding houses.
The all-in-one wastewater treatment plant consists of an equalization tank, aeration
tank, and a clarifier to remove solids, and the treated effluent is discharged to leach
fields. CSA 7 has 254 connections and serves over 600 residents. LAFCO originally
adopted a sphere of influence for CSA 7 back in 1987. The Commission, at that time,
adopted a sphere boundary that excluded parcels. Staff is recommending that these
parcels are included in the District’s sphere.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
County Service Area 7 serves residential housing and one commercial business within
the Boulder Creek Country Club subdivision. The service area includes 192 acres (0.3
square miles) and has an estimated population of 640. The wastewater system is a
full treatment plant offering secondary and tertiary treatment with primary disposal via
a community leach field. The wastewater treatment plant was constructed in the 1970s
and upgraded to tertiary treatment in the 1990s.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The CSA’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, CSA 7 has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
The CSA’s principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 77 of 177
COUNTY SERVICE AREA 10
(ROLLING WOODS/GRAHAM HILL)
District Overview
County Service Area 10 operates a sanitary sewer collection system in the southern part
of Rolling Woods centering around Treetop Drive and covers approximately 269 acres
(0.42 square miles). There are currently 157 connections within 382 parcels. CSA 10’s
sewage is transported through a gravity sewer main to the corner of Graham Hill Road
and Henry Cowell Drive, where it connects to the Graham Hill sewer main, and then
transfers to the City of Santa Cruz system. The City treats the sewage at its Neary Lagoon
Wastewater Treatment Facility and disposes the treated wastewater into the Pacific
Ocean off West Cliff Drive. Figure 32, on page 79, is a vicinity map of the service area.
Appendix F provides a copy of the formation resolution.
District History
Most of the Graham Hill corridor area has been developed with low-density homes on
individual septic systems. The sewer mains were built in parts of the corridor in three
phases. During the period of 1964-74, the County approved subdivisions in Rolling
Woods. The southern portion of Rolling Woods, centered along Treetop Drive, was
approved with quarter-acre lots. Sewage disposal was provided by a sanitary sewage
collection system and a treatment plant located on the east side of Graham Hill Road,
north of Nepenthe Drive. Disposal occurred in seepage pits near Brook Knoll School.
In 1996, after an extensive project review process involving several on-site and off-site
sewage disposal options, the County approved what is now known as the Woods Cove
Subdivision on the west side of Graham Road along Henry Cowell Drive. That approval
included keeping the Graham Hill Showgrounds for equestrian use. In 1998, the County’s
revised approval process required that the residential developer construct a collection
system in the new subdivision and a new sewer main along Graham Hill Road, from Henry
Cowell Drive to the sewer system operated by the City of Santa Cruz. The main includes
a siphon under the San Lorenzo River. The County sewer main connects to the city
system near the bus maintenance yard on River Street.
In 2001, after LAFCO’s approval, County Service Area 57 was formed to provide two
types of services in the Woods Cove and showgrounds area. These services included
storm water management for the drainage system that is directed downhill toward the
San Lorenzo River and sewer services to the Woods Cove subdivision and showgrounds.
In 2013, the County submitted an application to establish a single sewer provider in the
Graham Hill corridor. In consultation with LAFCO, the County evaluated several
alternatives for reorganizing sewer services. Based on staff’s analysis at that time, CSA
10 was the most logical successor to be the single sanitation agency in this area. In 2014,
the Commission approved a reorganization that transferred sewer services from CSA 57
to CSA 10. In total, 299 parcels were annexed into CSA 10 under this reorganization.
Todays, the District services 382 parcels within the Rolling Woods community.
Comprehensive Sanitation Service and Sphere Review Page 78 of 177
Figure 32: CSA 10’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 79 of 177
Population & Growth
The Graham Hill corridor area is substantially built-out with low-density single-family
homes. There are no growth projections available for CSA 10. In general, the Santa Cruz
County unincorporated area is projected to have slow growth over the next fifteen years.
Based on the growth rate of approximately 1% for the unincorporated areas in the County,
LAFCO staff projects that CSA 10’s entire population in 2040 will be around 920. The
projected population for CSA 10 are as follows:
Table 46: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
CSA 10 897 904 912 920 0.86%
Source: AMBAG 2018 Regional Growth Forecast
Services & Operations
CSA 10 has a collection system that serves the residential areas of Rolling Woods and
Woods Cove, as well as the Pasatiempo Golf Club. Based on the County’s 2022 Sewer
System Management Plan, CSA 10 has 157 connections with 3.18 miles of gravity sewer
lines, 0.35 miles of force main lines, and one pump station.
Infrastructure Summary
CSA 10 maintains and operates one pump station, a collection system, and has almost
900 residents within its service area. It currently has 157 connections and approximately
3.5 miles of sewer line. Table 47 provides an overview of the type of service and current
infrastructure:
Table 47: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
CSA 10 Collection N/A 157 1 3.5
CDI has indicated that if there is a system failure that occurs and must be fixed on an
emergency basis, depending on the size of the required repair, the CSA may require
additional funds.
Septic Systems within CSA 10
The operation and repair of septic systems is regulated by the Santa Cruz County Health
Department, Environmental Health Services Division. Properties currently using
individual septic systems may continue to use individual systems or may choose to
connect to CSA 10’s sewer main. A property owner may defer the decision to connect,
unless the property is less than 200 feet away from a sewer main and three of the
following situations occur: (1) If a septic system fails, the property must connect to the
sewer main; (2) If the property owner desires to do a major remodel but the septic system
does not meet current standards, upgrade of the septic system is not an option and the
property must connect to the sewer main; and (3) If a septic system repair has been
completed in the last five years using an interim conventional system where enhanced
treatment would have been required, the property must connect to the sewer main within
6 months of sewer availability.
Comprehensive Sanitation Service and Sphere Review Page 80 of 177
Sewer Rates
At present, CSA 10’s annual sewer rates derive from three areas: Rolling Woods, Woods
Cove, and the Pasatiempo Golf Club. Each area has its own sewer rate. Table 48 shows
the gradual increase in annual rates during the last seven years.
Table 48: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Golf Club $5,834.14 $6,096.68 $6,096.68 $6,096.68 $6,096.68 $6,096.68 $6,069.68
Rolling Woods $301.36 $314.92 $314.92 $314.92 $314.92 $314.92 $323.11
Woods Cove $301.36 $314.92 $314.92 $314.92 $314.92 $314.92 $323.11
Pursuant to Santa Cruz County Code Section 4.26, the Director of CDI must annually
compute the benefit assessment/service charge rates for CSAs and submit a report to
the Board of Supervisors describing each parcel of real property receiving the special
benefit and the amount of the charge per CSA for each parcel for the upcoming fiscal
year.
CSA fees are considered sewer rate charges, and any rate increase (except for
preapproved annual Consumer Price Index (CPI) increases) must comply with
Proposition 218 procedures. These procedures require that an increase is approved by
at least half of the votes cast by the property owners, with the votes weighted according
to the amount of the proposed assessment of each parcel. Furthermore, a public hearing
must be held to consider any protests to the proposed increase. The following tables
(Tables 49 to 51) depict the change in dollar amount and percentage for each specific
zone.
Table 49: Pasatiempo Golf Club’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Golf Club $5,834.14 $6,096.68 $6,096.68 $6,096.68 $6,096.68 $6,096.68 $6,096.68
Change ($) - $262.54 $0.00 $0.00 $0.00 $0.00 $0.00 $43.76
Change (%) - 5% 0% 0% 0% 0% 0% 0.75%
Table 50: Rolling Wood’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Rolling Woods $301.36 $314.92 $314.92 $314.92 $314.92 $314.92 $323.11
Change ($) - $13.56 $0.00 $0.00 $0.00 $0.00 $8.19 $3.63
Change (%) - 5% 0% 0% 0% 0% 3% 1%
Table 51: Woods Cove’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Woods Cove $301.36 $314.92 $314.92 $314.92 $314.92 $314.92 $323.11
Change ($) - $13.56 $0.00 $0.00 $0.00 $0.00 $8.19 $3.63
Change (%) - 5% 0% 0% 0% 0% 3% 1%
Comprehensive Sanitation Service and Sphere Review Page 81 of 177
When comparing the sewer rates with the other sanitation districts analyzed in this report,
CSA 10 is ranked the lowest in charges for single family units ($323.11/year). That rate
paid by the one commercial property in CSA 10 (Pasatiempo Golf Course) is not
comparable to the general business rates paid by businesses in the other districts/CSAs.
However, when the amount Pasatiempo paid to CSA 10 and the City of Santa Cruz in
2024 ($46,725) it is comparable to other similar facilities in SCCSD as shown on Figure
34. Sewer rate comparisons are shown in the following figures (Figures 33 and 34).
Figure 33: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$500.00 $323.11
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Figure 34: Annual Sewer Rates for Commercial Sites
$7,000.00
$6,215.35
$6,000.00
$4,823.00
$5,000.00
$4,000.00 $3,642.29
$2,872.56
$3,000.00
$2,000.00 $1,756.66
$1,000.00
$152.88
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Footnote: Salsipuedes Sanitary District data only includes flat rate and does not include the average water
use (HCF) and its associated HCF rate when compared to the other agencies.
Comprehensive Sanitation Service and Sphere Review Page 82 of 177
Finances
This section will highlight the CSA’s audited financial performance during the most recent
fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available. A
comprehensive analysis of the CSA’s financial performance during the past 12 years is
shown in Table 54 on page 85.
At the end of Fiscal Year 2023-24, total revenue collected was $122,037, representing a
42% increase from the previous year ($85,827 in FY 22-23). Total expenses for FY 2023-
24 were $27,123, which increased from the previous year by 54% ($17,638 in FY 22-23).
During LAFCO’s last service review analysis in 2019, CSA 10 experienced annual
surpluses in all five fiscal years (FY 13-14 to FY 17-18). During this service review cycle,
CSA 10 continued that positive trend by completing six consecutive annual surpluses in
the past six years (FY 18-19 to FY 23-24), as shown in Figure 35 below. Based on the
recently adopted budget and past performances, LAFCO staff believes that CSA 10 will
continue to operate effectively due to its stable revenue stream and stagnant
expenditures.
Comprehensive Sanitation Service and Sphere Review Page 83 of 177
535,61$
577,31$
843,52$
844,21$
329,901$
921,51$
897,701$
509,13$
833,29$
762,23$
636,811$
809,02$
951,16$
955,61$
610,46$
074,92$
514,54$
457,72$
728,58$
836,71$
730,221$
321,72$
242,16$
910,64$
Figure 35: Statement of Revenue & Expenditures
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$-
FY 13-14FY 14-15FY 15-16FY 16-17FY 17-18FY 18-19FY 19-20FY 20-21FY 21-22FY 22-23FY 23-24FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
CSA Revenues
CSA 10’s primary source of revenue is from Charges for Services. In FY 2023-24, the
CSA received revenue from four different sources: Charges for Services, Interest &
Investment Income, Connection Fees, and Assessments. On average, the District
receives approximately $55,000 each year in service fees. Table 52 highlights the total
revenue received since 2013.
Table 52: Total Revenue (FY 18-19 to FY 23-24)
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
Charges for Services $36,804 $38,810 $40,207 $50,567 $51,249 $51,872
Interest &
$14,506 $16,072 $5,854 -$18,346 $20,983 $40,929
Investment Income
Connection Fees $64,379 $3,330 $8,947 $10,247 $13,595 $17,447
Assessments $2,947 $2,947 $8,842 $2,947 $- $11,789
Permit Processing
$- $- $166 $- $- $-
Fees
Total Revenue $118,636 $61,159 $64,016 $45,415 $85,827 $122,037
CSA Expenditures
CSA 10’s total expenditures can be categorized into two budgetary groups: Services &
Supplies and Depreciation & Amortization. The figure below depicts how funding is
distributed by category. The CSA’s primary expenditure is associated with operational
and management costs, under Services and Supplies.
Figure 36: FY 2023-24 Expenditure Breakdown
Depreciation and Amortization
$9,019 (33%)
Services and Supplies
$18,104 (67%)
Comprehensive Sanitation Service and Sphere Review Page 84 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $1.15 million. The following
table highlights the Fund Balance from 2018 to 2025. As Table 53 shows below, the
District has experienced a steady increase in total reserves each year. On average, total
reserves have increased by approximately $99,000 or 34% since FY 2013-14. A full
review of the District’s revenues and expenditures from FY 2013-14 to FY 24-25 is shown
on Table 54.
Table 53: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $895,224 $939,824 $974,371 $992,032 $1,063,634 $1,155,134 $1,169,250
Change in ($) from
$44,600 $34,547 $17,661 $71,602 $91,500 $14,116
previous year
Change in (%) from
5% 4% 2% 7% 9% 1%
previous year
Table 54: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 1 6,518 $ 2 5,234 $ 107,867 $ 102,909 $ 8 3,423 $ 36,804 $ 3 8,810 $ 4 0,207 $ 50,567 $ 51,249 $ 51,872 $ 51,242
Intergovernmental $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Interest and Investment Income $ 17 $ 114 $ 2 ,056 $ 4 ,889 $ 8,915 $ 1 4,506 $ 16,072 $ 5,854 $ (18,346) $ 20,983 $ 40,929 $ 10,000
Permit Processing Fees $ - $ - $ - $ - $ - $ - $ - $ 1 66
Assessment DST Buy-in Cnnct Fees $ - $ - $ - $ - $ - $ 2,947 $ 2,947 $ 8,842 $ 2,947 $ - $ 11,789 $ -
Connection Fees $ - $ - $ - $ - $ - $ 6 4,379 $ 3,330 $ 8,947 $ 1 0,247 $ 13,595 $ 17,447 $ -
Insurance Proceeds $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Gain on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Revenue $ 1 6,535 $ 25,348 $ 109,923 $ 107,798 $ 9 2,338 $ 118,636 $ 6 1,159 $ 64,016 $ 45,415 $ 85,827 $ 122,037 $ 61,242
EXPENDITURES
Services and Supplies $ 4 ,455 $ 3 ,129 $ 5 ,904 $ 2 2,697 $ 21,357 $ 11,889 $ 7,540 $ 2 0,451 $ 1 8,735 $ 8 ,619 $ 18,104 $ 37,000
Depreciation and Amortization $ 9 ,320 $ 9 ,319 $ 9 ,225 $ 9,208 $ 9,019 $ 9,019 $ 9,019 $ 9,019 $ 9,019 $ 9 ,019 $ 9 ,019 $ 9 ,019
Approp for Contingencies $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Loss on Disposal of Capital Assets $ - $ - $ - $ - $ 1,891 $ - $ - $ - $ - $ - $ - $ -
Total Expenditure $ 1 3,775 $ 12,448 $ 15,129 $ 31,905 $ 32,267 $ 20,908 $ 16,559 $ 29,470 $ 27,754 $ 17,638 $ 27,123 $ 46,019
Surplus/(Deficit) $ 2 ,760 $ 12,900 $ 94,794 $ 7 5,893 $ 60,071 $ 9 7,728 $ 44,600 $ 34,546 $ 1 7,661 $ 68,189 $ 94,914 $ 15,223
Capital Contributions $ - $ - $ 391,559 $ - $ - $ - $ - $ - $ - $ - $ - $ -
Net Position - Beginning $ 159,519 $ 162,279 $ 175,179 $ 661,532 $ 7 37,425 $ 7 97,496 $ 8 95,224 $ 9 39,825 $ 9 74,371 $ 9 95,445 $ 1,060,220 $ 1,155,134
Net Position - Ending $ 162,279 $ 175,179 $ 661,532 $ 737,425 $ 7 97,496 $ 8 95,224 $ 9 39,824 $ 9 74,371 $ 9 92,032 $ 1,063,634 $ 1,155,134 $ 1,169,250
RESERVES
Capital Replacement Reserve $ 6,102 $ 51,735 $ 817,059 $ 436,039 $ 4 36,039 $ 6 08,807 $ 6 86,728 $ 8 24,608 $ 8 62,111 $ 909,745 $ 964,049 $ 1,104,332
Comprehensive Sanitation Service and Sphere Review Page 85 of 177
Governance
County Service Area 10 is a dependent special district governed by the County Board of
Supervisors and managed by the Public Works Department. The current Board is as
follows:
Table 55: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors generally meets twice a month on a Tuesday in the Board of
Supervisors’ Chambers, 701 Ocean Street, Room 525. Meetings generally begin at
9:00am. Public notice is provided through posting. The County contracts for independent
audits.
The County Community Development & Infrastructure Public Works Division is
responsible for the administration, engineering, maintenance, emergency response and
construction of all County sanitation services. The department also manages various
Board-governed special districts and CSAs. The Sanitation Operations unit is one of six
organizational units within the Special Services Division of Public Works and provides
operation and maintenance services to County sanitation districts and CSAs. Sanitation
operations employees work in all Districts and CSAs. Each sanitation district is governed
according to its specific code of regulations. The Districts’ codes are very similar, and
some sections are adopted by reference from the Santa Cruz County Sanitation District
Code. CSAs are governed according to the Santa Cruz County Code of Regulations. Most
of the County Code pertaining to sanitary sewer collection systems is adopted by
reference from the SCCSD Code.
Comprehensive Sanitation Service and Sphere Review Page 86 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the CSA’s website (even though said law only applies to independent
special districts). Table 56 summarizes staff’s findings on whether the website meets the
statutory requirements. At present, the CSA does meet the statutory requirements set
under SB 929 and SDLF’s website transparency criteria. LAFCO appreciates the recent
efforts by the County to revamp the organization’s website, which included a new
webpage specifically for the sewer agencies governed and managed by the County.
Table 56: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 87 of 177
Opportunities & Challenges
County Service Area 10 is significantly affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Capital Improvement Plan
There is no specific capital improvement plan for CSA 10. The County has a countywide
CIP to address the replacement of the aging sewer system, however, CSA 10 lacks funds
to make all the improvements. The County of Public Works continually seek grant or loan
funding to help finance these improvements.
LAFCO Staff Recommendation: Currently CSA 10 is included in the countywide capital
improvement plan. The County should consider if developing specific capital improvement
plans that cover the sanitation districts managed and operated by the Public Works
Department – Davenport, Freedom, Santa Cruz County Sanitation Districts, and CSAs 2,
5, 7, 10, and 20 have any added benefit compared to including it with the overall County
CIP. If the benefit outweighs the cost burden of preparing the specific CIPs, the County
should institute this practice.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following:
• Sanitary Sewer Spills are prohibited, and
• All Sanitary Sewer Spills, with the exception of Private Sewer Lateral Discharge
(PLSDs), irrespective of size, must be reported to the State Water Board electronically
using the California Integrated Water Quality System, and the Districts/CSAs must
prepare and implement a Sewer System Management Plan (SSMP).
In 2025, the County adopted a Sewer System Management Plan to cover the
management, operation and maintenance, design, construction and emergency response
of the Davenport Sanitation District, Freedom Sanitation District, Santa Cruz County
Sanitation District and three county service areas: CSAs 5, 7 and 10.
Governance Structure Options
CSA 10 is just north of the boundary for the City of Santa Cruz’s wastewater collection
system. The wastewater from the CSA is transported to the City’s treatment plant where
it is processed. Due to the proximity of the two systems, the shared transmission line to
the treatment plant, and the shared treatment plant, the County has requested that
LAFCO consider expanding the boundary of the City of Santa Cruz’s service area to
include the limits of this CSA. LAFCO staff sees value in local agencies collaborating and
exploring opportunities to improve delivery of municipal services. It is still unknown
whether it is feasible for the City or another local service provider to assume
Comprehensive Sanitation Service and Sphere Review Page 88 of 177
responsibilities within this area. Therefore, LAFCO staff recommends that the County
continue to discuss possible partnerships with the City and other neighboring agencies.
Sphere of Influence
LAFCO originally adopted a sphere of influence for the District in 1984. In 2014, the
Commission approved a reorganization that transferred sewer services from CSA 57 to
CSA 10. In total, 299 parcels were annexed into CSA 10 under this reorganization. As
part of the reorganization, CSA 10’s sphere of influence was amended to reflect the
annexation. Today, the sphere of influence for CSA 10 is coterminous with its service
area and includes 382 parcels. Figure 37 on page 90 shows the current sphere of
influence boundary for CSA 10.
Comprehensive Sanitation Service and Sphere Review Page 89 of 177
Figure 37: CSA 10’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 90 of 177
District Summary
County Service Area 10 (Rolling Woods/Graham Hill)
California Government Code, section 25210.1 et seq.
Formation
(County Service Area Law)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 1 full-time employee (approximately)
Facilities Collection System; 1 pump station; 157 connections
District Area 269 acres (0.42 square mile)
Coterminous with District (i.e. no sphere beyond existing
Sphere of Influence
jurisdictional boundary)
Total Revenue = $61,242
FY 2024-25 Budget Total Expenditure = $46,019
Projected Net Position (Beginning Balance) = $1,155,134
Mailing Address: 701 Ocean Street, Room 410, Santa Cruz CA
95060
Phone Number: (831) 54-2160
Email Address: Matt. Machado@santacruzcountyca.gov
Contact Information
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
CSA Liaison: Bergman Family (831-588-8760)
The Board regularly meets on most Tuesdays in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings
generally begin at 9:00 am.
The CSA does not have a published mission statement.
Mission Statement However, their mission aligns with the published mission
statement for the Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 91 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Graham Hill corridor area is substantially built-out with low-density single-family
homes. There are no growth projections available for CSA 10. In general, the Santa
Cruz County unincorporated area is projected to have slow growth over the next fifteen
years. Based on the growth rate of approximately 1% for the unincorporated areas in
the County, LAFCO staff projects that CSA 10’s entire population in 2040 will be
around 920.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within CSA 10.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
CSA 10 has a collection system and one lift station that serves the residential areas
of Rolling Woods and Woods Cove, as well as the Pasatiempo Golf Club. The plant
is maintained by the County of Santa Cruz. Based on the County’s 2022 Sewer
System Management Plan, CSA 10 has 104 connections with 3.18 miles of gravity
sewer lines, 0.35 miles of force main lines, and zero pump stations.
4. Financial ability of agencies to provide services.
County Service Area 10’s financial ability to provide services is well-established. The
CSA has successfully kept costs below its revenue stream since 2013. As of June 30,
2024, CSA 10 is operating with a net position of approximately $1.15 million.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The County currently has a countywide capital improvement plan and a specific capital
improvement plan for the Santa Cruz County Sanitation District. Additionally, the
County has adopted a Sewer System Management Plan. However, CSA 10 does not
have any current or proposed sewer-related capital improvement projects scheduled
at this time.
Comprehensive Sanitation Service and Sphere Review Page 92 of 177
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
CSA 10 has an aging collection system that serves the residential areas of Rolling
Woods and Woods Cove, as well as the Pasatiempo Golf Club. The plant is
maintained by the County of Santa Cruz. Based on the County’s 2022 Sewer System
Management Plan, CSA 10 has 104 connections with 3.18 miles of gravity sewer lines,
0.35 miles of force main lines, and zero pump stations. Annual sewer charges are the
District’s primary source of revenue.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
County Service Area 10 operates a sanitary sewer collection system and serves the
residential areas of Rolling Woods and Woods Cove, as well as the Pasatiempo Golf
Club. The County currently has a contractual agreement with the City of Santa Cruz
to transfer collected wastewater to the City of Santa Cruz’s treatment system. The City
treats the sewage at its Neary Lagoon Wastewater Treatment Facility and disposes
the treated wastewater into the Pacific Ocean off West Cliff Drive. CSA 10 has 104
connections and has almost 900 residents within its service area.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The CSA’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, CSA 10 has adequate transmission capacity
for the present and planned facilities within the sphere of influence. The CSA’s
principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 93 of 177
COUNTY SERVICE AREA 20
(TRESTLE BEACH)
District Overview
County Service Area 20 serves the Trestle Beach subdivision near La Selva Beach, which
encompasses 12.8 acres (0.02 square miles) and has a population of 43 within 38
parcels. The County formed CSA 20 in June 1980. Today, the wastewater system
provides on-site treatment to a secondary level. Figure 38, on page 95, is a vicinity map
of the service area. Appendix G provides a copy of the formation resolution.
Population & Growth
The Trestle Beach subdivision is built-out with low-density single-family homes. There are
no growth projections available for CSA 20. In general, the Santa Cruz County
unincorporated area is projected to have slow growth over the next fifteen years. Based
on the growth rate of approximately 1% for the unincorporated areas in the County,
LAFCO staff projects that CSA 20’s entire population in 2040 will be around 44.
The projected population for CSA 20 are as follows:
Table 57: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
CSA 20 43 43 44 44 0.86%
Source: AMBAG 2018 Regional Growth Forecast
Services & Operations
CSA 20 has a wastewater collection and treatment plant that treats the domestic
wastewater from the Trestle Beach community. Based on staff’s analysis, CSA 20 has 22
connections with 0.3 miles of sewer lines and 1 onsite treatment system. Annual sewer
charges are the District’s primary source of revenue.
Infrastructure Summary
CSA 20 operates a collection and treatment plant and serves about 40 residents. It
currently has 22 connections and approximately 0.3 miles of sewer line. Table 58
provides an overview of the type of service and current infrastructure:
Table 58: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Collection and
CSA 20 Secondary 22 1 0.3
Treatment
CDI has indicated that the current infrastructure is aging, deteriorating, and in need of
repair. The wastewater treatment plant currently also requires routine maintenance such
as painting and lining of sewer manholes. If there is a system failure that occurs and
must be fixed on an emergency basis, depending on the size of the required repair, the
CSA may require additional funds.
Comprehensive Sanitation Service and Sphere Review Page 94 of 177
Figure 38: CSA 20’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 95 of 177
Sewer Rates
At present, CSA 20’s annual sewer rates derive from single family units in the Trestle
Beach community. Table 59 shows the gradual increase in annual rates during the last
seven years.
Table 59: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Single
$2,410.81 $2,519.29 $3,652.98 $3,726.04 $3,882.53 $4,072.78 $4,178.67
Family
Change
$108.48 $1,133.69 $73.06 $156.49 $190.25 $105.89
($)
Change
4% 45% 2% 4% 5% 3%
(%)
Pursuant to Santa Cruz County Code Section 4.26, the Director of Public Works must
annually compute the benefit assessment/service charge rates for CSAs and submit a
report to the Board of Supervisors describing each parcel of real property receiving the
special benefit and the amount of the charge per CSA for each parcel for the upcoming
fiscal year.
CSA fees are considered sewer rate charges, and any rate increase (except for
preapproved annual Consumer Price Index (CPI) increases) must comply with
Proposition 218 procedures. These procedures require that an increase is approved by
at least half of the votes cast by the property owners, with the votes weighted according
to the amount of the proposed assessment of each parcel. Furthermore, a public hearing
must be held to consider any protests to the proposed increase.
When comparing the sewer rates with the other sanitation districts analyzed in this report,
CSA 20 is ranked the highest in charges for single family units ($4,178.67/year), as shown
in the figure below.
Figure 39: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,178.67
$4,000.00
$3,500.00
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Comprehensive Sanitation Service and Sphere Review Page 96 of 177
Finances
This section will highlight the District’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the District’s financial performance during the past 12 years
is shown in Table 63 on page 99.
At the end of Fiscal Year 2023-24, total revenue collected was $84,779, representing a
2% increase from the previous year ($82,827 in FY 22-23). Total expenses for FY 2023-
24 were $83,827, which increased from the previous year by 4% ($80,518 in FY 22-23).
During LAFCO’s last service review analysis in 2019, CSA 20 experienced annual deficits
in all five fiscal years (FY 13-14 to FY 17-18). During this service review cycle, CSA 20
experienced three annual deficits in the past six years (FY 18-19 to FY 23-24), as shown
in Figure 40 below. Based on the recently adopted budget and past performances,
LAFCO staff believes that the negative trend will continue unless additional revenue
sources are allocated to cover annual expenses.
Comprehensive Sanitation Service and Sphere Review Page 97 of 177
151,44$
404,65$
778,44$
175,15$
681,64$ 385,64$
264,74$
442,36$
090,94$
364,35$
851,15$ 043,15$
986,25$
853,09$
749,38$
412,07$
421,77$
307,38$
167,28$
815,08$
977,48$
728,38$
578,68$
007,78$
Figure 40: Statement of Revenues & Expenditures
$100,000
$90,000
$80,000
$70,000
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
$-
FY 13-14FY 14-15FY 15-16FY 16-17FY 17-18FY 18-19FY 19-20FY 20-21FY 21-22FY 22-23FY 23-24FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
CSA Revenues
CSA 20’s primary source of revenue is from Charges for Services. In FY 2023-24,
Charges for Services were $84,673 and Interest and Investment Income was $106. On
average, the District receives approximately $70,000 each year in service fees. Table 60
highlights the total revenue received since 2018.
Table 60: Total Revenue (FY 18-19 to FY 23-24)
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
Charges for Services $50,121 $52,376 $75,945 $77,464 $80,718 $84,673
Connection Fees $400 $- $8,000 $- $1,825 $-
Interest & Investment
$637 $313 $2 $(340) $218 $106
Income
Total Revenue $51,158 $52,689 $83,947 $77,124 $82,761 $84,779
CSA Expenditures
CSA 20’s only budgetary expense is associated with operational and management costs,
under Services and Supplies. Based on staff’s analysis of the County’s audited financial
statements, no other expenses have been reported for the past six years. As Table 61
shows, the CSA’s only expenditure fluctuates each year with more annual increases
spiking at a significant amount in comparison to years when reduction in expenses are
incurred.
Table 61: Total Expenditure (FY 18-19 to FY 23-24)
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
Services and Supplies $51,340 $90,358 $70,214 $83,703 $80,518 $83,827
Change ($) $39,018 $(20,144) $13,489 $(3,185) $3,309
Change (%) 76% -22% 19% -4% 4%
Additional Information
The Sanitation CSAs are primarily maintained by licensed Treatment Plant Operators.
Newly hired employees begin working as Operators In Training (OIT) under the guidance
of a licensed operator, upon obtaining their license the OIT can begin to work
independently. Staff can promote within the Treatment Plant Operator series,
progressing from an OIT, TPO to Sr. TPO. Salaries for TPOs represent a significant
portion of the maintenance expenses for the sanitation CSAs. Over the past five years,
the County has faced persistent challenges in recruiting at the TPO and Sr. TPO levels,
due to high housing costs in the County. For a small CSA, the assignment of a higher
level of TPO can impact the operating budget and ending fund balance.
Comprehensive Sanitation Service and Sphere Review Page 98 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $5,900. The following table
highlights the Fund Balance from 2018 to 2025. As Table 62 shows below, the District
has generally experienced a decrease in total reserves each year. On average, total
reserves have decreased by approximately $5,500 or 45% since FY 2013-14. A full
review of the District’s revenues and expenditures from FY 2013-14 to FY 2024-25 is
shown on Table 63.
The ending fund balance of $14.4k will be added to the $9.4k budgeted in FY25-26 for
capital improvement needs. As always, County staff will consider at increasing reserves
when they analyze the rate increase for FY26-27. They will seek community involvement
during the rate setting process to balance the need to increase reserves while still
providing reasonable rates.
Table 62: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $33,245 $(4,424) $9,309 $2,730 $4,973 $5,925 $4,914
Change in ($) from
$(37,669) $13,733 $(6,579) $2,243 $952 $(1,011)
previous year
Change in (%) from
-113% -310% -71% 82% 19% -17%
previous year
Footnote: In FY20-21, CSA 20 sewer rates were increased by 45% due to repairs made to the treatment plant, to
account for operator expenses, and have money for needed capital expenses. Historically, rather than showing a reserve
fund balance, all budgeted funds have been included in line items for maintenance, operations, and replacements.
Table 63: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 4 3,659 $ 44,620 $ 45,869 $ 4 7,061 $ 48,708 $ 5 0,121 $ 52,376 $ 7 5,945 $ 7 7,464 $ 8 0,718 $ 84,673 $ 8 6,875
Connection Fees $ - $ - $ - $ - $ - $ 4 00 $ - $ 8,000 $ - $ 1,825 $ - $ -
Intergovernmental $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Interest and Investment Income $ 4 92 $ 2 57 $ 3 17 $ 4 01 $ 3 82 $ 6 37 $ 3 13 $ 2 $ (340) $ 2 18 $ 1 06 $ -
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Gain on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Revenue $ 4 4,151 $ 44,877 $ 46,186 $ 47,462 $ 49,090 $ 51,158 $ 52,689 $ 83,947 $ 77,124 $ 82,761 $ 84,779 $ 86,875
EXPENDITURES
Services and Supplies $ 5 5,738 $ 50,893 $ 46,583 $ 6 3,244 $ 53,463 $ 5 1,340 $ 90,358 $ 7 0,214 $ 8 3,703 $ 8 0,518 $ 83,827 $ 8 7,700
Depreciation and Amortization $ 6 66 $ 6 78 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Loss on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Expenditure $ 5 6,404 $ 51,571 $ 46,583 $ 63,244 $ 53,463 $ 51,340 $ 90,358 $ 70,214 $ 83,703 $ 80,518 $ 83,827 $ 87,700
Surplus/(Deficit) $ (12,253) $ ( 6,694) $ (397) $ (15,782) $ ( 4,373) $ (182) $ (37,669) $ 1 3,733 $ ( 6,579) $ 2,243 $ 9 52 $ (825)
Net Position - Beginning $ 7 2,926 $ 60,673 $ 53,979 $ 5 3,582 $ 37,800 $ 3 3,427 $ 33,245 $ ( 4,424) $ 9,309 $ 2,730 $ 4,973 $ 5,739
Net Position - Ending $ 6 0,673 $ 53,979 $ 53,582 $ 3 7,800 $ 33,427 $ 3 3,245 $ ( 4,424) $ 9,309 $ 2,730 $ 4,973 $ 5,925 $ 4,914
RESERVES
Capital Replacement Reserve $ - $ 5,266 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Footnote: The FY24-25 Budget numbers show an ending balance of $4,914 but the actual ending balance that will be
reflected in next year’s audit is nearly $15,000.
Comprehensive Sanitation Service and Sphere Review Page 99 of 177
Governance
County Service Area 20 is a dependent special district governed by the County Board of
Supervisors and managed by the Public Works Department. The current Board is as
follows:
Table 64: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors meets on most Tuesdays in the Board of Supervisors’ Chambers,
701 Ocean Street, Room 525. Meetings generally begin at 9:00am. Public notice is
provided through posting. The County contracts for independent audits.
The County of Santa Cruz Public Works Division is responsible for the administration,
engineering, maintenance, emergency response and construction of all County sanitation
services. The department also manages various Board-governed special districts and
CSAs. The Sanitation Operations unit is one of six organizational units within the Special
Services Division of Public Works and provides operation and maintenance services to
County sanitation districts and CSAs. Sanitation operations employees work in all
Districts and CSAs. Each sanitation district is governed according to its specific code of
regulations. The Districts’ codes are very similar, and some sections are adopted by
reference from the Santa Cruz County Sanitation District Code. CSAs are governed
according to the Santa Cruz County Code of Regulations. Most of the County Code
pertaining to sanitary sewer collection systems is adopted by reference from the SCCSD
Code.
Comprehensive Sanitation Service and Sphere Review Page 100 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the CSA’s website (even though said law only applies to independent
special districts). Table 65 summarizes staff’s findings on whether the website meets the
statutory requirements. At present, the CSA does meet the statutory requirements set
under SB 929 and SDLF’s website transparency criteria. LAFCO appreciates the recent
efforts by the County to revamp the organization’s website, which included a new
webpage specifically for the sewer agencies governed and managed by the County.
Table 65: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 101 of 177
Opportunities & Challenges
County Service Area 20 is significantly affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Capital Improvement Plan
There is no specific capital improvement plan for CSA 20. The County has a countywide
CIP to address the replacement of the aging sewer system, however, CSA 20 lacks funds
to make all the improvements. The County of Public Works continually seek grant or loan
funding to help finance these improvements.
LAFCO Staff Recommendation: Currently CSA 20 is included in the countywide capital
improvement plan. The County should consider if developing specific capital improvement
plans that cover the sanitation districts managed and operated by the Public Works
Department – Davenport, Freedom, Santa Cruz County Sanitation Districts, and CSAs 2,
5, 7, 10, and 20 have any added benefit compared to including it with the overall County
CIP. If the benefit outweighs the cost burden of preparing the specific CIPs, the County
should institute this practice.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following:
• Sanitary Sewer Spills are prohibited, and
• All Sanitary Sewer Spills, with the exception of Private Sewer Lateral Discharge
(PLSDs), irrespective of size, must be reported to the State Water Board electronically
using the California Integrated Water Quality System, and the Districts/CSAs must
prepare and implement a Sewer System Management Plan (SSMP).
In 2022, the County adopted a Sewer System Management Plan to cover the
management, operation and maintenance, design, construction and emergency response
of the Davenport Sanitation District, Freedom Sanitation District, Santa Cruz County
Sanitation District and three county service areas (CSAs 5, 7, and 10). However, it is
LAFCO staff’s understanding that CSA 20 is excluded from the County SSMP because
the CSA does not meet the minimum requirements to enroll under the Waste Discharge
Requirements.
LAFCO Staff Recommendation: While SSMP only requires inclusion of collection
systems with more than one mile of sewer mains, the County may want to consider
including CSA 20 in the County’s Sewer System Management Plan to ensure that the
Trestle Beach community’s sewer infrastructure has proper management and oversight
for current and future needs.
Comprehensive Sanitation Service and Sphere Review Page 102 of 177
Sphere of Influence
LAFCO originally adopted spheres of influence for a number of CSAs back in the 1980s.
Based on staff’s analysis and research, it was determined that there is no sphere of
influence for CSA 20. In accordance to Government Code Section 56425, the
Commission shall adopt a sphere of influence for cities, special districts, and county
service areas.
During the months of August and September in 2019, LAFCO staff met with
representatives of CSA 20 to discuss the sphere designation. While the CSA was
experiencing a financial shortage at that time, the County reassured LAFCO that they
were working to make CSA 20 economically sustainable. As a result of LAFCO’s ongoing
discussions with the County, the Commission adopted a coterminous sphere of influence
with a note that if the financial shortage continued, the Commission should consider a
zero sphere during the next service review cycle.
It appears that the County has made some improvements to CSA 20’s finances,
operations, and transparency. Therefore, LAFCO staff is recommending that the
Commission reaffirm the existing sphere boundary, as shown in Figure 41 on page 104.
Comprehensive Sanitation Service and Sphere Review Page 103 of 177
Figure 41: CSA 20 Current Sphere
Comprehensive Sanitation Service and Sphere Review Page 104 of 177
District Summary
County Service Area 20 (Trestle Beach)
California Government Code, section 25210.1 et seq.
Formation
(County Service Area Law)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 1.25 full-time employee (approximately)
Facilities Collection and Treatment Plant; 1 pump station; 22 connections
District Area 12.8 acres (0.02 square mile)
Coterminous with District (i.e. no sphere beyond existing
Sphere of Influence
jurisdictional boundary)
Total Revenue = $86,875
FY 2024-25 Budget Total Expenditure = $87,700
Projected Net Position (Beginning Balance) = $5,739
Mailing Address: 701 Ocean Street, Room 410, Santa Cruz CA
95060
Phone Number: (831) 454-2160
Contact Information Email Address: Matt.Machado@santacruzcountyca.gov
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
CSA Liaison: Reed Welch (408) 472-7390
The Board regularly meets on most Tuesdays in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings
generally begin at 9:00 am.
The CSA does not have a published mission statement.
Mission Statement However, their mission aligns with the published mission
statement for the Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 105 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Trestle Beach subdivision is built-out with low-density single-family homes. There
are no growth projections available for CSA 20. In general, the Santa Cruz County
unincorporated area is projected to have slow growth over the next fifteen years.
Based on the growth rate of approximately 1% for the unincorporated areas in the
County, LAFCO projects that CSA 20’s entire population in 2040 will be around 44.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within CSA 20.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
CSA 20 has a wastewater collection and treatment plant that treats the domestic
wastewater from the Trestle Beach community. Based on staff’s analysis, CSA 20 has
22 connections with 0.3 miles of sewer lines and 1 pump station. Annual sewer
charges are the District’s primary source of revenue.
4. Financial ability of agencies to provide services.
County Service Area 20 has experienced an annual deficit in three of the last six years.
As of June 30, 2024, CSA 20 is operating with a net position of approximately $5,900.
LAFCO staff projects that this negative trend will continue unless the CSA increases
its overall revenue stream or decreases annual expenses.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The County currently has a countywide capital improvement plan and a specific capital
improvement plan for the Santa Cruz County Sanitation District. Additionally, the
County has adopted a Sewer System Management Plan. However, CSA 20 does not
have any current or proposed sewer-related capital improvement projects scheduled
at this time.
Comprehensive Sanitation Service and Sphere Review Page 106 of 177
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
CSA 20 operates a collection and treatment plant located in the Trestle Beach
subdivision near La Selva Beach. The wastewater system provides on-site treatment
to a secondary level and serves a small community of around 40 residents.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
The Public Works Department has indicated that the current infrastructure is aging,
deteriorating, and in need of repair. The wastewater treatment plant currently requires
approximately $95,000 in repairs.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The CSA’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, CSA 20 has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
The CSA’s principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 107 of 177
DAVENPORT COUNTY SANITATION DISTRICT
District Overview
The Davenport County Sanitation District (District) owns and operates a wastewater
treatment facility serving the community of Davenport, which includes a domestic
wastewater collection system, influent headworks, aerated lagoon, sand filter, and a
chlorine contact tank. The District provides service to approximately 109 sewer
connections within 136 parcels. More recently, the District now operates a recycled water
treatment plant, with a recycled water fill station and a recycled water storage pond.
Figure 42, on page 109, is a vicinity map of the service area. Appendix H provides a
copy of the formation resolution.
The Davenport County Sanitation District serves 112 water connections in the Old Town,
New Town, and San Vicente areas of Davenport. The District relies on surface water
diverted from Mill Creek and San Vicente Creek for supply. The District is managed by
the County Department of Public Works and infrastructure needs are funded by water
and sewer rates and grants. For purposes of this report, staff’s analysis will focus on the
sanitation services provided by the District.
Infrastructure Summary
Davenport County Sanitation District provides treated drinking water and sewage
collection, treatment and disposal services to the town of Davenport. It currently has 109
connections and approximately 3.2 miles of sewer line. Table 66 provides an overview of
the type of service and current infrastructure:
Table 66: Infrastructure Summary
Treatment No. of No. of Lift Miles of
Type of System
Level Connections Stations Sewer Line
Collection,
Davenport County
Treatment, and Tertiary 109 3 3.0
Sanitation District
Recycled Water
Population & Growth
The Davenport community is generally built-out with residential and commercial use.
There are no growth projections available for the District. In general, the Santa Cruz
County unincorporated area is projected to have slow growth over the next fifteen years.
Based on the growth rate of approximately 1% for the unincorporated areas in the County,
LAFCO staff projects that the District’s entire population in 2040 will be 225. The projected
population for the Davenport County Sanitation District are as follows:
Table 67: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
Davenport County
219 221 223 225 0.86%
Sanitation District
Source: AMBAG 2018 Regional Growth Forecast
Comprehensive Sanitation Service and Sphere Review Page 108 of 177
Figure 42: Davenport County Sanitation District’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 109 of 177
Services & Operations
The Davenport County Sanitation District has an aging collection and treatment plant that
serves residential units in the Davenport Community. The District also operates a
recycled water system. The infrastructure is maintained by the County of Santa Cruz.
Based on the County’s 2022 Sewer System Management Plan, Davenport County
Sanitation District has 109 connections with 3.0 miles of gravity sewer lines, 1.30 miles
of force main lines, and 3 pump stations. Revenues to operate the District are collected
yearly from residents and businesses that are connected to either the waterworks or the
sanitary sewer system.
The volume of wastewater is determined from records of water usage as metered by the
Davenport Water Facility. Due to the lead time involved in getting the yearly sewer
charges placed on the County property tax statements, the current fiscal year's charges
are based on water use and strength factors from the previous calendar year.
Prior to its closure in 2008, the CEMEX Cement Plant was the primary user of effluent
from the wastewater treatment facility. Today, CEMEX still owns the parcel and has an
existing extraterritorial service agreement in place for water and sewer services. The
existing facility treats about 28 acre-feet of water annually to Title 22 disinfected tertiary
level and the treated water is spray irrigated onto un-mowed turf adjacent to the treatment
plant. The wastewater is treated in a 4-million-gallon capacity aerated lagoon where it
undergoes primary and secondary treatment. Coagulant and hypochlorite are added to
lagoon effluent prior to tertiary treatment in an up-flow sand filter. The filter has an area
of 19 square feet; this equates to a maximum capacity of 95 gpm (136,800 gpd) at the
maximum allowable loading rate under Title 22 requirements.
The treated wastewater then passes through a 3,000-gallon chlorine contact chamber for
disinfection. For disinfected tertiary quality water Title 22 requires 90 minutes of contact
time and a CT of not less than 450 mg-min/L; to meet this requirement the flow rate would
need to be no more than 48,000 gpd with a chlorine residual of 5 mg/L. Sodium bisulfite
is injected after the chlorine contact chamber for de-chlorination and the treated effluent
is pumped to a spray field adjacent to the plant for application to un-mowed grass.
Sewer Rates
At present, the District’s annual sewer rates derive from three areas: Single Family
Dwelling, Commercial, and Schools. Each area has its own sewer rate. Table 68 shows
the gradual increase in annual rates during the last seven years.
Table 68: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Residential $2,333.00 $2,433.56 $2,546.96 $2,664.00 $2,575.22 $2,775.52 $2,383.28
Commercial $759.76 $803.26 $837.92 $874.70 $832.74 $899.70 $749.72
Additional
$19.98 $19.98 $20.94 $20.94 $21.35 $30.65 $20.02
Charge*
School* $759.76 $803.26 $837.92 $874.70 $832.74 $899.70 $749.72
Additional
$53.34 $53.34 $55.92 $55.92 $51.46 $55.40 $48.25
Charge*
Note: Additional Charge is for “Commercial” is per Hundred Cubic Feet of Water (HCF); Additional Charge
is for “School” is per Average Daily Attendance (ADA)
Comprehensive Sanitation Service and Sphere Review Page 110 of 177
Revenues to operate the Davenport County Sanitation District are collected annually from
residents, businesses and schools that are connected to the sanitary sewer system
through property taxes and manual bills. Sewer service rates are established through
hearings held with the Santa Cruz County Board of Supervisors.
Using information supplied by District staff, the rates are reviewed each year by an
independent engineering firm which specializes in revenue studies for utility districts and
are subject to final approval by the Board. Before the rates are set, a notice of public
hearing is mailed to all owners of property within the Sanitation District boundaries,
another notice is published in the Santa Cruz Sentinel, and the public hearing is held. The
public hearing is normally scheduled in April or May of each year, with the rates becoming
effective on the first of July. The following tables (Tables 69 to 71) show the gradual
increase in annual rates for each area.
Table 69: Residential’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Residential $2,333.00 $2,433.56 $2,546.96 $2,664.00 $2,575.22 $2,775.52 $2,383.28
Change
$100.56 $113.40 $117.04 -$88.78 $200.30 -$392.24 $22.11
($)
Change
4% 5% 5% -3% 8% -14% 1%
(%)
Table 70: Commercial’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Commercial $759.76 $803.26 $837.92 $874.70 $832.74 $899.70 $749.72
Change
$43.50 $34.66 $36.78 -$41.96 $66.96 -$149.98 $3.19
($)
Change
6% 4% 4% -5% 8% -17% 1%
(%)
Table 71: School’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
School $759.76 $803.26 $837.92 $874.70 $832.74 $899.70 $749.72
Change
$43.50 $34.66 $36.78 -$41.96 $66.96 -$149.98 $3.19
($)
Change
6% 4% 4% -5% 8% -17% 1%
(%)
When comparing the sewer rates with the other sanitation districts analyzed in this report,
Davenport County Sanitation District is ranked the fourth highest in charges for single
family units ($2,383.28/year). Using a general business with a water usage of 192
hundred cubic feet of annual water usage, Davenport’s commercial charges are ranked
the second highest($4,823/year). When comparing schools with 135 students, Davenport
ranked the highest compared to school sites in other Districts/CSAs ($7,635/year). Sewer
rate comparisons are shown in the following figures (Figures 43 to 45) on page 112.
Comprehensive Sanitation Service and Sphere Review Page 111 of 177
Figure 43: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00
$2,383.28
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Figure 44: Annual Sewer Rates for Commercial Sites
$7,000.00
$6,215.35
$6,000.00
$4,823.00
$5,000.00
$4,000.00 $3,642.29
$2,872.56
$3,000.00
$1,756.66
$2,000.00
$1,000.00
$152.88
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Figure 45: Annual Sewer Rates for School Sites
$9,000.00
$7,635.20
$8,000.00
$7,000.00
$6,000.00
$5,000.00
$4,132.89
$4,000.00
$2,839.57
$3,000.00
$2,000.00
$661.72
$1,000.00
$82.32
$0.00
Salsipuedes CSA 10 Freedom Co Santa Cruz Co Davenport Co
Comprehensive Sanitation Service and Sphere Review Page 112 of 177
Finances
This section will highlight the District’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the District’s financial performance during the past 9 years
is shown in Table 73 on page 115.
At the end of Fiscal Year 2023-24, total revenue collected was $329,068, representing a
10% increase from the previous year ($300,470 in FY 22-23). Total expenses for FY
2023-24 were $298,514, which decreased from the previous year by 32% ($436,566 in
FY 22-23). During LAFCO’s last service review analysis in 2019, the District experienced
consecutive annual deficits in FY 16-17 and FY 17-18. During this service review cycle,
the District continued to experience annual deficits in the past six years (FY 18-19 to FY
23-24), as shown in Figure 46 below. While the recently adopted budget is anticipating a
positive fiscal year, LAFCO staff believes that the historical negative trend will continue
unless additional revenue sources are allocated to cover annual expenses.
Footnote: DCSD is a small district; therefore, any expense is split between a small number of
users. The sewer system is aging and as a result the County has been balancing building up
reserves while trying to keep sewer charges reasonable.
Comprehensive Sanitation Service and Sphere Review Page 113 of 177
990,212$
262,852$
120,462$
765,182$ 303,872$
465,852$ 511,852$
922,772$
539,592$ 070,403$ 578,403$
423,082$
074,003$
665,634$
860,923$
415,892$ 198,792$ 868,792$
Figure 46: Statement of Revenues & Expenditures
$500,000
$450,000
$400,000
$350,000
$300,000
$250,000
$200,000
$150,000
$100,000
$50,000
$-
FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
District Revenues
The District’s primary source of revenue is from Charges for Services. In FY 2023-24,
Charges for Services represented 99% of total revenue, as shown in Figure 47.
Figure 47: FY 2023-24 Revenue Breakdown
Property Taxes $17
(0.01%)
Charges for Services
$329,051 (99.99%)
District Expenditures
The District’s total expenditures can be categorized into three budgetary groups: Services
& Supplies, Depreciation & Amortization, and Interest Expense. The figure below depicts
how funding is distributed by category. The District’s primary expenditure is associated
with operational and management costs, under Services and Supplies.
Figure 48: FY 2023-24 Revenue Breakdown
Interest Expense
$366 (0.12%)
Depreciation and Amortization
$61,455 (20.59%)
Services and Supplies
$236,693 (79.29%)
Comprehensive Sanitation Service and Sphere Review Page 114 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $10 million. The following
table highlights the Fund Balance from 2018 to 2025. As Table 72 shows below, the
District has generally experienced a decrease in total reserves each year. On average,
total reserves have decreased by approximately $63,000 or 4% between FY 19-20 to FY
23-24. A full review of the District’s revenues and expenditures from FY 2013-14 to FY
24-25 is shown on Table 73.
Table 72: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $921,802 $902,687 $738,703 $724,271 $576,716 $762,535 $762,558
Change in ($) from
$(19,115) $(163,984) $(14,432) $(147,555) $185,819 $23
previous year
Change in (%) from
-2% -18% -2% -20% 32% 0%
previous year
Table 73: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ - $ - $ - $ 2 11,387 $ 2 66,379 $ 2 81,409 $ 2 89,918 $ 2 98,271 $ 3 06,411 $ 2 99,627 $ 3 29,051
Interest and Investment Income $ - $ - $ - $ 7 12 $ (2,358) $ (20,925) $ (31,803) $ ( 2,336) $ ( 1,536) $ 8 43 $ -
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 17
Other Revenue $ - $ - $ - $ - $ - $ 17,819 $ - $ - $ - $ -
Total Revenue $ - $ - $ - $ 212,099 $ 2 64,021 $ 278,303 $ 2 58,115 $ 2 95,935 $ 3 04,875 $ 3 00,470 $ 3 29,068 $ 297,891
EXPENDITURES
Services and Supplies $ - $ - $ - $ 1 95,908 $ 2 20,215 $ 1 97,572 $ 2 16,607 $ 2 44,597 $ 2 20,851 $ 3 75,919 $ 2 36,693
Depreciation and Amortization $ - $ - $ - $ 59,335 $ 5 8,637 $ 5 8,637 $ 5 8,637 $ 5 8,637 $ 5 8,637 $ 5 9,811 $ 6 1,455
Interest Expense $ - $ - $ - $ 3,019 $ 2,715 $ 2,355 $ 1,985 $ 8 36 $ 8 36 $ 8 36 $ 3 66
Total Expenditure $ - $ - $ - $ 258,262 $ 2 81,567 $ 258,564 $ 2 77,229 $ 3 04,070 $ 2 80,324 $ 4 36,566 $ 2 98,514 $ 297,868
Surplus/(Deficit) $ - $ - $ - $ (46,163) $ (17,546) $ 1 9,739 $ (19,114) $ ( 8,135) $ 2 4,551 $ ( 136,096) $ 3 0,554 $ 23
Capital Contributions $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Net Position - Beginning $ - $ - $ - $ 9 65,777 $ 9 19,614 $ 9 02,068 $ 9 21,802 $ 9 02,687 $ 7 38,703 $ 7 24,271 $ 5 76,716 $ 762,535
Net Position - Ending $ - $ - $ - $ 9 19,614 $ 9 02,068 $ 9 21,802 $ 9 02,687 $ 7 38,703 $ 7 24,271 $ 5 76,716 $ 7 62,535 $ 762,558
RESERVES
Capital Improvement Reserves $ 67,951 $ - $ - $ 2 48,195 $ - $ - $ 18,409 $ 10,000 $ 1 25,751 $ 1 31,075 $ 56,655 $ 1 0,000
Comprehensive Sanitation Service and Sphere Review Page 115 of 177
Governance
The Davenport County Sanitation District is governed by a District Board comprised of
members of the Santa Cruz County Board of Supervisors. The DCSD is a nonprofit public
agency providing treated drinking water and sewage collection, treatment and disposal
services to the town of Davenport. The current Board is as follows:
Table 74: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors meets on most Tuesdays in the Board of Supervisors’ Chambers,
701 Ocean Street, Room 525. Meetings generally begin at 9:00am. Public notice is
provided through posting. The County contracts for independent audits.
The County of Santa Cruz Public Works Division is responsible for the administration,
engineering, maintenance, emergency response and construction of all County sanitation
services. The division also manages various Board-governed special districts and CSAs.
The Sanitation Operations unit is one of six organizational units within the Special
Services Division of Public Works and provides operation and maintenance services to
County sanitation districts and CSAs. Sanitation operations employees work in all
Districts and CSAs. Each sanitation district is governed according to its specific code of
regulations. The Districts’ codes are very similar, and some sections are adopted by
reference from the Santa Cruz County Sanitation District Code. CSAs are governed
according to the Santa Cruz County Code of Regulations. Most of the County Code
pertaining to sanitary sewer collection systems is adopted by reference from the SCCSD
Code.
Comprehensive Sanitation Service and Sphere Review Page 116 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the District’s website (even though said law only applies to
independent special districts). Table 75 summarizes staff’s findings on whether the
website meets the statutory requirements. At present, the District does meet the statutory
requirements set under SB 929 and SDLF’s website transparency criteria. LAFCO
appreciates the recent efforts by the County to revamp the organization’s website, which
included a new webpage specifically for the sewer agencies governed and managed by
the County.
Table 75: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 117 of 177
Opportunities & Challenges
The Davenport County Sanitation District is significantly affected by aging infrastructure,
escalating operational costs, and changes to state laws and regulations that may
introduce new requirements without additional funding. These issues are common with
other sanitation districts in Santa Cruz County. The following section discusses these
challenges and identifies possible opportunities to ensure the delivery of wastewater
services in an efficient and effective manner.
Infrastructure Deficiencies
Older infrastructure is aging, deteriorating, and in need of repair. The County previously
indicated that one undersized sewer trunk required upsizing to lift a sanitary sewer
moratorium: this project was scheduled for 2020-2021. The District also expressed
interest in the past to relocate the existing water line from the intake at San Vicente Creek
and through the creek bed to a more secure location in the adjacent roadway. This would
take significant funds to study viable options, complete the necessary studies, obtain
permits, and construct the new pump station and pipeline. Today, infrastructure
improvements continues to be an ongoing issue for not only the District, but rather, most
of the sanitation districts throughout the County – which highlights the importance of a
robust capital improvement plan.
Capital Improvement Plan
The Davenport County Sanitation District is part of the County’s 2025/30 Capital
Improvement Program. The 2025/30Capital Improvement Program (CIP) presents a five-
year financing implementation plan for capital improvements within the unincorporated
County; Parks, Open Space and Cultural Services; and County Facility projects located
Countywide. The CIP is an outgrowth of cooperative planning, programming and
financing efforts through the County Administrative Office and by the County’s land use
departments including Planning, Public Works, and Parks, Open Space and Cultural
Services, as well as non-land use departments including the Health Services Agency,
General Services Department, Probation, and the Sheriff’s Department. Unprogrammed
road, roadside, sanitation, flood control, parks, and recycling and solid waste projects
(which funding is not anticipated for in the coming five years, or longer, and meets
requirements of unincorporated County service level needs at build-out under the 1994
General Plan) are also identified in the CIP. The 2025/30CIP currently identifies two
projects within the Davenport County Sanitation District, the Davenport Drinking Water
Improvements Phase III and the Davenport Water Tank Rehabilitation. Neither of
these projects impact the sewer system.
LAFCO Staff Recommendation: Currently Davenport is included in the countywide
capital improvement plan. The County should consider if developing specific capital
improvement plans that cover the sanitation districts managed and operated by the Public
Works Department – Davenport, Freedom, Santa Cruz County Sanitation Districts, and
CSAs 2, 5, 7, 10, and 20 have any added benefit compared to including it with the overall
County CIP. If the benefit outweighs the cost burden of preparing the specific CIPs, the
County should institute this practice.
Comprehensive Sanitation Service and Sphere Review Page 118 of 177
Sphere of Influence
LAFCO originally adopted a coterminous sphere of influence for the District in 1991, as
shown in Figure 49 on page 120. A coterminous sphere of influence is identical to the
agency’s jurisdictional boundary. For the past 34 years, the sphere boundary has
remained unchanged. Although the CEMEX site is and has been served by the District,
the sphere of influence boundary does not include the CEMEX property.
Proposed Sphere Amendment
The CEMEX parcel has been receiving services from the District since 2005 under an
extraterritorial service agreement (ESA) and the County has previously expressed
interest in annexing the parcel. The parcel is approximately 112 acres and is designated
for agricultural and rural mountain residential use under the County’s General Plan. To
ensure that the District’s sphere accurately reflects its service area, LAFCO is
recommending that the Commission amend the sphere to include the existing ESA.
Figure 50 on page 121 shows the proposed sphere boundary.
Comprehensive Sanitation Service and Sphere Review Page 119 of 177
Figure 49: Davenport County Sanitation District’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 120 of 177
Figure 50: Davenport County Sanitation District’s Proposed Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 121 of 177
District Summary
Davenport County Sanitation District
County Sanitation District Act (Health and Safety Code
Formation
Sections 4700-4858)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 2.50 full-time employee (approximately)
Collection, Treatment, and Recycled Water Plant; 3 pump
Facilities
stations; 109 connections
District Area 64 acres (0.1 square mile)
Coterminous with District (i.e. no sphere beyond existing
Sphere of Influence
jurisdictional boundary)
Total Revenue = $297,891
FY 2024-25 Budget Total Expenditure = $297,868
Projected Net Position (Beginning Balance) = $762,558
Mailing Address: 701 Ocean Street, Room 410, Santa Cruz CA
95060
Phone Number: (831) 454-2160
Contact Information
Email Address: Matt.Machado@santacruzcountyca.gov
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
The Board regularly meets on most Tuesdays in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings
generally begin at 9:00 am.
The District does not have a published mission statement.
Mission Statement However, their mission aligns with the published mission
statement for the Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 122 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Davenport community is generally built-out with residential and commercial use.
There are no growth projections available for the District. In general, the Santa Cruz
County unincorporated area is projected to have slow growth over the next fifteen
years. Based on the growth rate of approximately 1% for the unincorporated areas in
the County, LAFCO projects that the District’s entire population in 2040 will be 225.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within the District.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
The Davenport County Sanitation District has an aging collection and treatment plant
that serves residential units in the Davenport Community. The District also operates
a recycled water system. The infrastructure is maintained by the County of Santa
Cruz. Based on the County’s 2022 Sewer System Management Plan, Davenport
County Sanitation District has 109 connections with 3.0 miles of gravity sewer lines,
1.30 miles of force main lines, and 3 pump stations. Revenues to operate the District
are collected yearly from residents and businesses that are connected to either the
waterworks or the sanitary sewer system.
4. Financial ability of agencies to provide services.
The Davenport County Sanitation District continues to experience annual deficits.
LAFCO staff projects that this negative trend will continue unless the District increases
its overall revenue stream or decreases annual expenses. As of June 30, 2024, the
District is operating with a net position of approximately $10 million.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The CEMEX plant closed in 2008. The County has indicated that if the CEMEX plant
is sold and developed, it could add a significant population to the Davenport County
Sanitation District’s service area. Any added commercial or residential use would be
Comprehensive Sanitation Service and Sphere Review Page 123 of 177
beneficial to the District, as the revenue generated from the sewer and water rates
could fund necessary infrastructure improvements that are too expensive for the small
population of the District to fund. If the CEMEX site were to be developed, the water
treatment plant and recycled water plant would need to be expanded to meet the new
demands. There would also be a need for new transmission lines and possibly pump
stations to serve the new development.
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
The Davenport County Sanitation District owns and operates a wastewater treatment
facility serving the community of Davenport, which includes a domestic wastewater
collection system, influent headworks, aerated lagoon, sand filter, and a chlorine
contact tank. More recently, the District now operates a recycled water treatment
plant, with a recycled water fill station and a recycled water storage pond. The District
currently has 109 connections and serves over 200 residents.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
The CEMEX plant closed in 2008. The County has indicated that if the CEMEX plant
is sold and developed, it could add a significant population to the Davenport County
Sanitation District’s service area.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The District’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, the District has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
The District’s principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 124 of 177
FREEDOM COUNTY SANITATION DISTRICT
District Overview
The Freedom County Sanitation District provides wastewater collection service for the
Buena Vista/Calabasas area of Freedom and the Green Valley Road corridor outside the
Watsonville city limits (totaling 1,504 parcels). Figure 51, on page 126, is a vicinity map
of the service area. The Santa Cruz County Board of Supervisors acts as the Board of
Directors to the District. The County Public Works Department operates the District’s
sewage collection system. The District contracts with the City of Watsonville to treat,
recycle, and dispose of the District’s wastewater at the city treatment plant. Appendix I
provides a copy of the formation resolution.
Population & Growth
The Freedom area is substantially built-out. There are no growth projections available for
the District. In general, the Santa Cruz County unincorporated area is projected to have
slow growth over the next fifteen years. Based on the growth rate of approximately 1%
for the unincorporated areas in the County, LAFCO staff projects that the District’s entire
population in 2040 will be around 4,300. The projected population for the Freedom County
Sanitation District are as follows:
Table 76: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
Freedom County
4,236 4,272 4,308 4,345 0.86%
Sanitation District
Source: AMBAG 2018 Regional Growth Forecast
Services & Operations
The Freedom County Sanitation District has two non-contiguous service zones. The
western zone serves the neighborhoods of the Watsonville Airport off Freedom
Boulevard, Buena Vista Drive, Calabasas Road, and Bowker Road. The northern service
zone serves the Green Valley Road corridor, including neighborhoods off Steward Street,
Pajaro Lane, Amesti Road, Paulsen Road, Melody Lane, and Mesa Verde. The District
collection system is pumped to the wastewater treatment plant on Beach Street, owned
and operated by the City of Watsonville. The volume of wastewater is determined from
records of water usage as metered by the Watsonville Water Department. Based on the
County’s 2022 Sewer System Management Plan, Freedom County Sanitation District has
approximately 1,891 connections with over 15miles of gravity sewer lines, and 9 pump
stations, as shown in Table 77.
Table 77: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Freedom County
Collection N/A 1,891 9 15.30
Sanitation District
Comprehensive Sanitation Service and Sphere Review Page 125 of 177
Figure 51: Freedom County Sanitation District’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 126 of 177
Sewer Rates
At present, the District’s annual sewer rates derive from five user classes: Single-Family
Units, Multi-Family Units, Mobile Homes, Commercial, and Schools. Each user class has
its own sewer rate. Table 78 shows a gradual increase in annual rates during the last
seven years.
Table 78: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Single-Family $559.80 $593.54 $640.86 $694.80 $746.96 $814.44 $882.76
Multi-Family $418.22 $417.70 $443.60 $453.72 $488.10 $532.32 $576.66
Mobile Homes $478.80 $546.64 $614.56 $700.84 $753.42 $821.50 $890.42
Commercial $142.74 $146.26 $161.78 $156.88 $171.70 $190.50 $198.92
Additional Charge
$4.14 $4.80 $5.39 $6.18 $6.63 $7.23 $7.84
(per HCF)*
School* $142.74 $146.26 $161.78 $156.88 $171.70 $190.50 $198.92
Additional Charge
$11.05 $12.83 $14.39 $16.49 $15.98 $17.42 $18.90
(per ADA)*
Note: Additional Charge is for “Commercial” is per Hundred Cubic Feet of Water (HCF); Additional Charge
is for “School” is per Average Daily Attendance (ADA)
Revenues to operate the Freedom County Sanitation District are collected annually from
residents, businesses and schools that are connected to the sanitary sewer system
through property taxes and manual bills. Sewer service rates are established through
hearings held with the Santa Cruz County Board of Supervisors.
Using information supplied by District staff, the rates are reviewed each year by an
independent engineering firm which specializes in revenue studies for utility districts and
are subject to final approval by the Board. Before the rates are set, a notice of public
hearing is mailed to all owners of property within the Sanitation District boundaries,
another notice is published in the Santa Cruz Sentinel, and the public hearing is held. The
public hearing is normally scheduled in April or May of each year, with the rates becoming
effective on the first of July. The following tables (Tables 79 to 83) show the gradual
increase in annual rates for each area.
Table 79: Single-Family Unit’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Single
$559.80 $593.54 $640.86 $694.80 $746.96 $814.44 $882.76
Family
Change
$33.74 $47.32 $53.94 $52.16 $67.48 $68.32 $40.57
($)
Change
6% 8% 8% 8% 9% 8% 6.68%
(%)
Comprehensive Sanitation Service and Sphere Review Page 127 of 177
Table 80: Multi-Family Unit’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Multi-
$418.22 $417.70 $443.60 $453.72 $488.10 $532.32 $576.66
Family
Change
-$0.52 $25.90 $10.12 $34.38 $44.22 $44.34 $21.26
($)
Change
0% 6% 2% 8% 9% 8% 4.89%
(%)
Table 81: Mobile Home Unit’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Mobile
$478.80 $546.64 $614.56 $700.84 $753.42 $821.50 $890.42
Homes
Change
$67.84 $67.92 $86.28 $52.58 $68.08 $68.92 $49.41
($)
Change
14.2% 12% 14% 8% 9% 8% 10.9%
(%)
Table 82: Commercial’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Commercial $142.74 $146.26 $161.78 $156.88 $171.70 $190.50 $198.92
Change
$3.52 $15.52 -$4.90 $14.82 $18.80 $8.42 $4.52
($)
Change
2% 11% -3% 9% 11% 4% 2.77%
(%)
Table 83: School’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
School $142.74 $146.26 $161.78 $156.88 $171.70 $190.50 $198.92
Change
$3.52 $15.52 -$4.90 $14.82 $18.80 $8.42 $4.52
($)
Change
2% 11% -3% 9% 11% 4% 2.77%
(%)
When comparing the sewer rates with the other sanitation districts analyzed in this report,
Freedom County Sanitation District is ranked the third lowest in charges for single family
units ($882.76/year), ranked the lowest in charges for multi-family units ($576.66/year)
and ranked the highest in charges to mobile home units ($890.42/year). Using a general
business with a water usage of 192 hundred cubic feet of annual water usage, Freedom’s
commercial charges are ranked the second lowest ($1,757/year). When comparing
schools with 135 students, Freedom ranked the second lowest compared to school sites
in other Districts/CSAs ($2,840/year). Sewer rate comparisons are shown in the following
figures (Figures 52 to 56).
Comprehensive Sanitation Service and Sphere Review Page 128 of 177
Figure 52: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$882.76
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Figure 53: Annual Sewer Rates for Multi-Family Units
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$576.66
$500.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Single Family $576.66 $586.68 $923.52 $1,411.19 $2,069.37 $2,477.10
Comprehensive Sanitation Service and Sphere Review Page 129 of 177
Figure 54: Annual Sewer Rates for Mobile Home Units
$900.00 $890.42
$880.00
$860.00
$840.00
$820.00
$800.00 $788.64
$780.00
$760.00
$740.00
$720.00
Santa Cruz Co Freedom Co
Figure 55: Annual Sewer Rates for Commercial Sites
$7,000.00
$6,215.35
$6,000.00
$4,823.00
$5,000.00
$4,000.00 $3,642.29
$2,872.56
$3,000.00
$1,756.66
$2,000.00
$1,000.00
$152.88
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Figure 56: Annual Sewer Rates for School Sites
$9,000.00
$8,000.00 $7,635.20
$7,000.00
$6,000.00
$5,000.00
$4,132.89
$4,000.00
$2,839.57
$3,000.00
$2,000.00
$1,000.00 $661.72
$82.32
$0.00
Salsipuedes CSA 10 Freedom Co Santa Cruz Co Davenport Co
Comprehensive Sanitation Service and Sphere Review Page 130 of 177
Finances
This section will highlight the District’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the District’s financial performance during the past 12 years
is shown in Table 85 on page 133.
At the end of Fiscal Year 2023-24, total revenue collected was approximately $5 million,
representing a 258% increase from the previous year ($1.5 million in FY 22-23). Total
expenses for FY 2023-24 were approximately $1.7 million, which increased from the
previous year by 20% ($1.4 million in FY 22-23). During LAFCO’s last service review
analysis in 2019, the District experienced annual deficits in three of the five fiscal years
(FY 13-14 to FY 17-18). During this service review cycle, the District continued to
experience annual deficits in the past six years (FY 18-19 to FY 23-24), as shown in
Figure 57 below. The recently adopted budget also anticipates another negative year.
LAFCO staff believes that the historical negative trend will continue unless additional
revenue sources are allocated to cover annual expenses.
Comprehensive Sanitation Service and Sphere Review Page 131 of 177
704,087$
982,095$
117,308$
037,769$
499,658$ 399,238$ 983,168$
772,701,1$
202,859$
048,490,1$ 005,620,1$
787,077$
212,370,1$ 430,651,1$
108,366,3$
787,981,1$
587,190,3$
165,191,1$
072,405,1$
265,224,1$
119,193,5$
838,507,1$
894,340,8$
231,861,9$
Figure 57: Statement of Revenues & Expenditures
$10,000,000
$9,000,000
$8,000,000
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$-
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
District Revenues
Freedom County Sanitation District’s primary source of revenue is Charges for Services.
In FY 2023-24, the District received revenue from multiple sources as shown in Figure
58.
Figure 58: FY 2023-24 Revenue Breakdown
Interest and Investment Income
$27,873 (0.52%)
Charges for Services
$1,373,117 (25.47%)
Intergovernmental
$3,917,318 (72.65%)
Permit Processing
Fees $601 (0.01%)
Other Revenue
$73,002 (1.35%)
District Expenditures
The District’s total expenditures can be categorized into three budgetary groups, as
shown in Figure 59. The District’s primary expenditure is associated with operational and
management costs, under Services and Supplies.
Figure 59: FY 2023-24 Expenditure Breakdown
Interest Expense
$48,488 (2.84%)
Depreciation and Amortization
$529,354 (31.03%)
Services and Supplies
$1,127,996 (66.13%)
Comprehensive Sanitation Service and Sphere Review Page 132 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $9.5 million. The following
table highlights the Fund Balance from 2018 to 2025. As Table 84 shows below, the
District has generally experienced a decrease in total reserves each year due to an influx
of intergovernmental assistance in certain years. A full review of the District’s revenues
and expenditures from FY 2013-14 to FY 24-25 is shown on Table 85.
Table 84: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $6,359,690 $6,439,370 $8,913,384 $12,480,184 $10,895,316 $14,581,389 $9,475,500
Change in ($)
from previous $79,680 $2,474,014 $3,566,800 $(1,584,868) $3,686,073 $(5,105,889)
year
Change in (%)
from previous 1% 38% 40% -13% 34% -35%
year
Table 85: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 7 65,831 $ 7 95,227 $ 8 45,074 $ 8 44,752 $ 935,805 $ 988,340 $ 1 ,048,619 $ 1,118,875 $ 1,239,427 $ 1,316,750 $ 1,373,117 $ 1,580,500
Permit Processing Fees $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 601 $ -
Other Revenue $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 77,993 $ 73,002 $ 6,456,998
Job Cost Billings Only $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Intergovernmental $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 71,977 $ 3,917,318 $ -
Interest and Investment Income $ 14,576 $ 8,484 $ 11,920 $ 16,637 $ 22,397 $ 38,160 $ 2 4,593 $ 6 ,567 $ (29,934) $ 37,550 $ 27,873 $ 6,000
Fed-Misc Grants $ - $ - $ - $ - $ - $ - $ - $ 2,538,359 $ 1,882,292 $ - $ - $ -
Property Taxes $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Gain on Disposal of Capital Assets $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Total Revenue $ 7 80,407 $ 8 03,711 $ 8 56,994 $ 8 61,389 $ 958,202 $ 1,026,500 $ 1 ,073,212 $ 3 ,663,801 $ 3 ,091,785 $ 1 ,504,270 $ 5 ,391,911 $ 8 ,043,498
EXPENDITURES
Services and Supplies $ 4 02,847 $ 7 59,792 $ 6 27,096 $ 8 99,002 $ 869,217 $ 560,803 $ 908,795 $ 957,588 $ 899,557 $ 855,247 $ 1,127,996 $ 1,075,391
Depreciation and Amortization $ 1 87,442 $ 2 07,938 $ 2 05,897 $ 2 08,275 $ 210,881 $ 209,984 $ 247,239 $ 232,199 $ 223,519 $ 517,770 $ 529,354 $ 755,347
Operating Transfers Out $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 7,142,032
Interest Expense $ - $ - $ - $ - $ - $ - $ - $ - $ 68,485 $ 49,545 $ 48,488 $ 47,419
Contrib to Other Agencies $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 147,943
Loss on Disposal of Capital Assets $ - $ - $ - $ - $ 14,742 $ - $ - $ - $ - $ - $ - $ -
Total Expenditure $ 5 90,289 $ 9 67,730 $ 8 32,993 $ 1,107,277 $ 1 ,094,840 $ 770,787 $ 1 ,156,034 $ 1 ,189,787 $ 1 ,191,561 $ 1 ,422,562 $ 1 ,705,838 $ 9 ,168,132
Surplus/(Deficit) $ 1 90,118 $ ( 164,019) $ 24,001 $ ( 245,888) $ ( 136,638) $ 255,713 $ ( 82,822) $ 2,474,014 $ 1,900,224 $ 81,708 $ 3,686,073 $ (1,124,634)
Net Position - Beginning $ 6 ,598,905 $ 6 ,789,023 $ 6 ,625,004 $ 6 ,649,005 $ 6 ,403,117 $ 6 ,266,479 $ 6 ,522,192 $ 6,439,370 $ 8,913,384 $ 10,813,608 $ 10,895,316 $ 10,600,134
Net Position - Ending $ 6 ,789,023 $ 6 ,625,004 $ 6 ,649,005 $ 6 ,403,117 $ 6 ,266,479 $ 6 ,522,192 $ 6 ,439,370 $ 8,913,384 $ 10,813,608 $ 10,895,316 $ 14,581,389 $ 9,475,500
RESERVES
Wastewater Reserves $ 921 $ 49,445 $ 27,408 $ - $ - $ - $ 400,000 $ 612,103 $ - $ - $ - $ -
Sewer Project Reserves $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
M&O Reserves $ - $ - $ - $ - $ - $ - $ 50,000 $ 3 7,813 $ 1 0,000 $ 10,000 $ 1 4,071 $ 100,000
Total Reserves $ 921 $ 49,445 $ 27,408 $ - $ - $ - $ 450,000 $ 649,916 $ 10,000 $ 10,000 $ 14,071 $ 100,000
Comprehensive Sanitation Service and Sphere Review Page 133 of 177
Governance
The Freedom County Sanitation District is governed by a District Board comprised of
members of the Santa Cruz County Board of Supervisors. The FCSD is a nonprofit public
agency providing sewage collection to the town of Freedom. The current Board is as
follows:
Table 86: Board of Directors
Board Member Supervisorial District Term of Office
First District
(Live Oak, Soquel, Summit,
First Elected: 2020
Manu Koenig Santa Cruz Gardens,
Next Election: Primary 2028
Carbonera, and parts of
Scotts Valley & Capitola)
Second District
(Aptos, Freedom, Corralitos, First Elected: 2024
Kimberly De Serpa
La Selva Beach, and parts of Next Election: Primary 2028
Capitola & Watsonville)
Third District
First Elected: 2022
Justin Cummings (Santa Cruz, Bonny Doon,
Next Election: Primary 2026
North Coast)
Fourth District First Elected: 2022
Felipe Hernandez
(Pajaro Valley, Watsonville) Next Election: Primary 2026
Fifth District
(San Lorenzo Valley, most of First Elected: 2024
Monica Martinez
Scotts Valley, parts of Santa Next Election: Primary 2028
Cruz, and Paradise Park)
The Board of Directors meets on most Tuesdays in the Board of Supervisors’ Chambers,
701 Ocean Street, Room 525. Meetings generally begin at 9:00am. Public notice is
provided through posting. The County contracts for independent audits.
The County of Santa Cruz Public Works Division is responsible for the administration,
engineering, maintenance, emergency response and construction of all County sanitation
services. The division also manages various Board-governed special districts and CSAs.
The Sanitation Operations unit is one of six organizational units within the Special
Services Division of Public Works and provides operation and maintenance services to
County sanitation districts and CSAs. Sanitation operations employees work in all
Districts and CSAs. Each sanitation district is governed according to its specific code of
regulations. The Districts’ codes are very similar, and some sections are adopted by
reference from the Santa Cruz County Sanitation District Code. CSAs are governed
according to the Santa Cruz County Code of Regulations. Most of the County Code
pertaining to sanitary sewer collection systems is adopted by reference from the SCCSD
Code.
Comprehensive Sanitation Service and Sphere Review Page 134 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the District’s website (even though said law only applies to
independent special districts). Table 87 summarizes staff’s findings on whether the
website meets the statutory requirements. At present, the District does meet the statutory
requirements set under SB 929 and SDLF’s website transparency criteria. LAFCO
appreciates the recent efforts by the County to revamp the organization’s website, which
included a new webpage specifically for the sewer agencies governed and managed by
the County.
Table 87: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews ✓
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 135 of 177
Opportunities & Challenges
The Freedom County Sanitation District is affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Capital Improvement Plan
The Freedom County Sanitation District is part of the County’s 2021/22 Capital
Improvement Program. The 2021/22 Capital Improvement Program (CIP) presents a five-
year financing implementation plan for capital improvements within the unincorporated
County; Parks, Open Space and Cultural Services; and County Facility projects located
Countywide. The CIP is an outgrowth of cooperative planning, programming and
financing efforts through the County Administrative Office and by the County’s land use
departments including Planning, Public Works, and Parks, Open Space and Cultural
Services, as well as non-land use departments including the Health Services Agency,
General Services Department, Probation, and the Sheriff’s Department. Unprogrammed
road, roadside, sanitation, flood control, parks, and recycling and solid waste projects
(which funding is not anticipated for in the coming five years, or longer, and meets
requirements of unincorporated County service level needs at build-out under the 1994
General Plan) are also identified in the CIP. The Freedom Sewer Rehabilitation Phase
I and Freedom Sewer Rehabilitation Phase III projects are included in the 2021/22 CIP.
These projects are now completed. Together they rehabilitated over 4.2 miles of sewer
mains and associated manholes.
Sewer System Management Plan
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems. These requirements include the following:
• Sanitary Sewer Spills are prohibited, and
• All Sanitary Sewer Spills, with the exception of Private Sewer Lateral Discharge
(PLSDs), irrespective of size, must be reported to the State Water Board electronically
using the California Integrated Water Quality System, and the Districts/CSAs must
prepare and implement a Sewer System Management Plan (SSMP).
In 2022, the County adopted a Sewer System Management Plan to cover the
management, operation and maintenance, design, construction and emergency response
of the Davenport Sanitation District, Freedom Sanitation District, Santa Cruz County
Sanitation District and County Service Areas sanitary sewer systems.
Comprehensive Sanitation Service and Sphere Review Page 136 of 177
Sphere of Influence
The Freedom County Sanitation District was formed in 1958, before the establishment of
LAFCOs. Santa Cruz LAFCO adopted the first sphere of influence for the District in 1975,
and performed a major review of the District’s sphere boundary in 1990. The last sphere
update for the Freedom County Sanitation District was in March 2011. At present, the
sphere boundary goes beyond the jurisdictional boundary of the District. A total of 266
parcels are located within the District’s sphere. Staff recommends that the Commission
reaffirm the sphere boundary. Figure 60 on page 138 shows the current sphere of
influence boundary for the Freedom County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 137 of 177
Figure 60: Freedom County Sanitation District’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 138 of 177
District Summary
Freedom County Sanitation District
County Sanitation District Act (Health and Safety Code
Formation
Sections 4700-4858)
Board of Directors 5 members, elected at-large to four-year terms
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 8 full-time employees (approximately)
Facilities Collection System; 9 pump stations; 1,891 connections
District Area 704 acres (1.1 square mile)
Larger than District (i.e. sphere goes beyond existing
Sphere of Influence
jurisdictional boundary)
Total Revenue = $8,043,498
FY 2024-25 Budget Total Expenditure = $9,168,132
Projected Net Position (Beginning Balance) = $14,581,389
Mailing Address: 701 Ocean Street, Room 410 Santa Cruz CA
95060
Phone Number: (831) 454-2160
Contact Information
Email Address: Matt.Machado@santacruzcountyca.gov
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
The Board regularly meets on most Tuesdays in the Board of
Public Meetings Supervisors' Chambers, 701 Ocean St, Rm. 525. Meetings
generally begin at 9:00 am.
The District does not have a published mission statement.
Mission Statement However, their mission aligns with the published mission
statement for the Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 139 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
The Freedom area is substantially built-out. There are no growth projections available
for the District. In general, the Santa Cruz County unincorporated area is projected to
have slow growth over the next fifteen years. Based on the growth rate of
approximately 1% for the unincorporated areas in the County, LAFCO staff projects
that the District’s entire population in 2040 will be around 4,300.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within the District.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
The Freedom County Sanitation District provides wastewater collection service for the
Buena Vista/Calabasas area of Freedom and the Green Valley Road corridor outside
the Watsonville city limits (totaling 1,504 parcels).
4. Financial ability of agencies to provide services.
The Freedom County Sanitation District has recently experienced annual deficits.
During the last six fiscal years, deficits have ranged from $1.1 to $1.6 million. As of
June 30, 2024, the District is operating with a net position of approximately $15 million.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The Freedom County Sanitation District provides wastewater collection service for the
Buena Vista/Calabasas area of Freedom and the Green Valley Road corridor outside
the Watsonville city limits. The District also serves three connections outside its
boundaries, including one duplex, one single family dwelling, and the Pinto Lake
County Park ranger’s residence. The District currently has over 1,800 connections and
serves approximately 4,000 residents.
Comprehensive Sanitation Service and Sphere Review Page 140 of 177
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
The Freedom County Sanitation District provides wastewater collection service for the
Buena Vista/Calabasas area of Freedom and the Green Valley Road corridor outside
the Watsonville city limits. The District also serves three connections outside its
boundaries, including one duplex, one single family dwelling, and the Pinto Lake
County Park ranger’s residence. The District currently has over 1,800 connections and
serves approximately 4,000 residents.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
The Freedom County Sanitation District was formed in 1958, before the establishment
of LAFCOs. Santa Cruz LAFCO adopted the first sphere of influence for the District in
1975, and performed a major review of the District’s sphere boundary in 1990. Since
then, the City of Watsonville has annexed over 300 acres of the District involving
thousands of residents at the time of annexation. The last sphere update for the
Freedom County Sanitation District was in March 2011. LAFCO is recommending that
the current sphere be reaffirmed.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The District’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, the District has adequate transmission and
treatment capacity for the present and planned facilities within the sphere of influence.
The District’s principal needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 141 of 177
SALSIPUEDES SANITARY DISTRICT
District Overview
The Salsipuedes Sanitary District has provided wastewater collection services to the
unincorporated area northeast of Watsonville since 1965. The service area of the District
encompasses about 800 acres and includes 502 parcels. Today, the District provides
services to residential properties, as well as to Lakeview Middle School, St. Francis High
School, Our Lady Help of Christians Catholic Church, the Santa Cruz County
Fairgrounds, and several commercial businesses. Appendix J provides a copy of the
formation resolution. The main streets in Salsipuedes Sanitary District’s jurisdictional
boundary include East Lake Avenue (Highway 152) and College Road. The District has
512 connections, and rents an office at 739 East Lake Avenue in Watsonville. The District
has a five-person board of directors and employs a part-time Secretary-Manager. The
District has a contract with the City of Watsonville to treat, recycle, and/or dispose sewage
at the City’s plant on Beach Road. Figure 61, on page 143, is a vicinity map of the service
area.
District History
Salsipuedes Sanitary District was formed in 1965 following an election. Prior to the
formation of the Salsipuedes Sanitary District, the Interlocken County Sanitary District
provided limited sanitary sewer service to the unincorporated area in southern Santa Cruz
County, northeast of the City of Watsonville. Upon formation, the District boundary
extended from the Watsonville city limits at Hushbeck Avenue to the north end of Cutter
Drive. The District has experienced a series of boundary changes of which the principal
annexations were along East Lake Avenue (Highway 152) to include what is now
Lakeview Middle School, Our Lady Help of Christians Catholic Church, St. Francis High
School, two cemeteries, and the Santa Cruz County Fairgrounds. Detachments involving
the District have also occurred as land was annexed to the City of Watsonville, which took
over the sanitary sewer service responsibilities. A significant detachment occurred in
1987, in which LAFCO conditioned the Fairgrounds Reorganization to detach 200 acres
of commercial agricultural land. This land was previously annexed into the District in the
1960s but was unlikely to need sewer service due to the agricultural land preservation
policies enacted by the County in the 1970s and 1980s.
Population & Growth
There are no growth projections available for the Salsipuedes Sanitary District. In general,
the Santa Cruz County unincorporated area is projected to have slow growth over the
next fifteen years. Based on the growth rate of approximately 1% for the unincorporated
areas in the County, LAFCO staff projects that the District’s population in 2040 will be
around 2,228. In the daytime, the population in the District increases from attendance at
the schools, churches, and fairgrounds. The projected population for the Salsipuedes
Sanitary District is as follows:
Table 88: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
Salsipuedes
2,172 2,190 2,209 2,228 0.86%
Sanitary District
Source: AMBAG 2018 Regional Growth Forecast
Comprehensive Sanitation Service and Sphere Review Page 142 of 177
Figure 61: Salsipuedes Sanitary District’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 143 of 177
Services & Operations
Salsipuedes Sanitary District provides wastewater collection services for 512 connections
within an unincorporated area northeast of Watsonville. Treatment of collected
wastewater is provided by the Watsonville Wastewater Treatment Plant. The District has
two lift stations and seven miles of sewer pipeline. The only reported sewer spill in the
last ten years occurred in May 2014 when forty gallons spilled in the Beverly Drive
neighborhood. To avoid a repeat spill, the district added that sewer segment to its
preventive maintenance program. The District utilizes a private contractor, Green Line, to
perform the maintenance on the mains and pump stations.
Table 89: Current Infrastructure
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Salsipuedes
Collection N/A 512 2 7.0
Sanitary District
In 2009, in cooperation with the Pajaro Valley Water Management Agency, the City of
Watsonville began treating part of its effluent flow to an advanced tertiary level, and
providing it to the Pajaro Valley Water Management Agency to mix with inland well water
and distribute through its Coastal Distribution System to irrigate farms in the coastal area
of the Pajaro Valley. This recycled water use is a major component in reducing saltwater
intrusion into the groundwater aquifers. The tertiary plant has a capacity of 7.7 million
gallons per day. On October 1, 2015, the Pajaro Valley Water Management Agency broke
ground on a 1.5-million-gallon storage tank that will increase tertiary water deliveries
during the peak irrigation periods.
Contractual Agreement with the City of Watsonville
The District has acquired certain capacity rights to the City of Watsonville’s Wastewater
Treatment Facilities under an agreement dated March 28, 1985. The agreement provides
for the apportionment of the costs of construction, reconstruction, enlargement,
maintenance and operation of the existing and proposed facilities for the treatment and
disposal of all sanitary sewage and industrial waste.
Under the agreement, the District does not obtain any ownership rights or other property
rights, other than capacity rights. Capacity rights are for the right to discharge to the City
of Watsonville’s collection system and treatment plant up to a maximum of 0.281 million-
gallon-per-day (mgd) of wastewater flow, 440 pounds a day biochemical oxygen demand,
and 514 pounds a day suspended solids reflecting 1.7%, 0.71% and 1.00%, respectively
of the treatment plant’s capacity. Charges under the contract include operations and
maintenance (based on the total flow from the District divided by the total flow to the
treatment plant) and city collection system capital improvements (based on the District’s
rights to use in the improved facility). Charges under the contract totaled $157,252 for FY
2023-24. The following table depicts the City’s contractual charges for the District’s share
of the treatment plant’s operating and maintenance expenses during the last 5 years.
Table 90: Charges under the contract with the City of Watsonville
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24
(audit) (audit) (audit) (audit) (audit) (audit)
Contractual Charges $94,838 $128,580 $174,395 $173,536 $164,575 $157,252
Change ($) $33,742 $45,815 $(859) $(8,960) $(7,323)
Change (%) 35.6% 35.6% -0.5% -5.2% -4.4%
Comprehensive Sanitation Service and Sphere Review Page 144 of 177
Sewer Rates
At present, the District’s annual sewer rates derive from five primary areas: Single Family
Dwelling, Condominiums, Commercial, the Lakeview Middle School, and the
Fairgrounds. Each area has its own sewer rate. The following tables (Tables 91 to 96)
show the gradual increase in annual flat rates during the last seven years.
Table 91: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Residential $694.80 $715.68 $729.96 $729.96 $751.80 $766.80 $782.16
Condos $521.16 $536.76 $547.44 $547.44 $563.88 $575.16 $586.68
Commercial $117.96 $122.40 $126.12 $136.56 $141.84 $150.84 $152.88
School $74.04 $76.20 $77.64 $77.16 $79.32 $80.64 $82.32
Fairgrounds $18,069.00 $19,277.04 $18,976.08 $15,642.96 $18,462.00 $19,332.00 $21,852.00
Table 92: Single Family Dwelling’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Single-
$694.80 $715.68 $729.96 $729.96 $751.80 $766.80 $782.16
Family
Change
$20.88 $14.28 $0.00 $21.84 $15.00 $15.36 $16.06
($)
Change
3% 2% 0% 3% 2% 2% 2%
(%)
Table 93: Condominium’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Multi-
$521.16 $536.76 $547.44 $547.44 $563.88 $575.16 $586.68
Family
Change
$15.60 $10.68 $0.00 $16.44 $11.28 $11.52 $12.04
($)
Change
3% 2% 0% 3% 2% 2% 2%
(%)
Table 94: Commercial’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Commercial $117.96 $122.40 $126.12 $136.56 $141.84 $150.84 $152.88
Change
$4.44 $3.72 $10.44 $5.28 $9.00 $2.04 $5.28
($)
Change
4% 3% 8% 4% 6% 1% 4%
(%)
Comprehensive Sanitation Service and Sphere Review Page 145 of 177
Table 95: School’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
School $74.04 $76.20 $77.64 $77.16 $79.32 $80.64 $82.32
Change
$2.16 $1.44 -$0.48 $2.16 $1.32 $1.68 $1.38
($)
Change
3% 2% -1% 3% 2% 2% 2%
(%)
Table 96: Fairground’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Fairgrounds $18,069.00 $19,277.04 $18,976.08 $15,642.96 $18,462.00 $19,332.00 $21,852.00
Change
$1,208.04 -$300.96 -$3,333.12 $2,819.04 $870.00 $2,520.00 $740.45
($)
Change
7% -2% -18% 18% 5% 13% 5%
(%)
When comparing the sewer rates with the other sanitation districts analyzed in this report,
Salsipuedes Sanitary District is ranked the second lowest in charges for single family
units ($782.16/year), ranked the second lowest in charges for multi-family units
($586.68/year), and ranked the lowest in commercial sites ($152.88/year), and ranked
the lowest in charges to school units ($82.32/year). Sewer rate comparisons are shown
in the following figures (Figures 62 and 65). It is important to note that the sewer rates
for SSD only includes flat rates and no other supplemental charges regarding commercial
or school rates as included in the other sewer agencies in Figures 64 and 65.
Figure 62: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,000.00 $782.16
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Comprehensive Sanitation Service and Sphere Review Page 146 of 177
Figure 63: Annual Sewer Rates for Multi-Family Units
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,000.00
$586.68
$500.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Single Family $576.66 $586.68 $923.52 $1,411.19 $2,069.37 $2,477.10
Figure 64: Annual Sewer Rates for Commercial Sites
$7,000.00
$6,215.35
$6,000.00
$4,823.00
$5,000.00
$4,000.00 $3,642.29
$2,872.56
$3,000.00
$1,756.66
$2,000.00
$1,000.00
$152.88
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Figure 65: Annual Sewer Rates for School Sites
$9,000.00
$8,000.00 $7,635.20
$7,000.00
$6,000.00
$5,000.00
$4,132.89
$4,000.00
$2,839.57
$3,000.00
$2,000.00
$661.72
$1,000.00
$82.32
$0.00
Salsipuedes CSA 10 Freedom Co Santa Cruz Co Davenport Co
Comprehensive Sanitation Service and Sphere Review Page 147 of 177
Finances
This section will highlight the District’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the District’s financial performance during the past 12 years
is shown in Table 99 on page 150.
At the end of Fiscal Year 2023-24, total revenue collected was $538,297, representing a
10% increase from the previous year ($489,697 in FY 22-23). Total expenses for FY
2023-24 were $329,870, which increased from the previous year by 19% ($276,140 in
FY 22-23). During LAFCO’s last service review analysis in 2019, the District experienced
annual surpluses in all five fiscal years (FY 13-14 to FY 17-18). During this service review
cycle, the District continued to experience consecutive annual surpluses in the past six
years (FY 18-19 to FY 23-24), as shown in Figure 66 below. Based on the recently
adopted budget and past performances, LAFCO staff believes that the District will
continue to operate effectively due to its stable revenue stream and stagnant
expenditures.
Comprehensive Sanitation Service and Sphere Review Page 148 of 177
642,553$
947,162$
554,663$
538,303$
838,773$
773,832$
358,114$
971,892$
509,114$
491,832$
155,144$
192,692$
536,744$
870,242$
870,354$
965,003$
735,534$
040,392$
796,984$
041,672$
792,835$
078,923$
962,125$ 962,125$
Figure 66: Statement of Revenues & Expenditures
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$-
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
District Revenues
Operating Revenue
Salsipuedes Sanitary District’s primary source of revenue is from Sewer Service Charges.
In FY 2023-24, Sewer Service Charges totaled approximately $424,000. Overall,
operating revenue represents 79% of the District’s entire revenue stream. Table 97
highlights the operating revenue funds for FY 2023-24.
Non-Operating Revenue
In FY 2023-24, the District collected approximately $114,000 in non-operating revenue.
Interest Income ($86,231) and Property Taxes ($26,824) are the largest contributors to
the non-operating revenue stream. Overall, non-operating revenue represents 21% of the
District’s entire revenue stream. Table 97 highlights the non-operating revenue funds for
FY 2023-24.
Table 97: Fiscal Year 2023-24 Revenue Breakdown
Operating Revenues: ($) (%)
Sewer Service Charges $424,117 78.79%
Miscellaneous Revenue - 0.00%
Sub-total: Operating Revenue $424,117 78.79%
Non-Operating Revenues:
Interest Income $86,231 16.02%
Taxes – Property $26,824 4.98%
Homeowners Property Tax Relief $124 0.02%
Sewer Inspection and Fees $1,000 0.19%
Sub-total: Non-Operating Revenue $114,179 21.21%
Total Revenue $538,297 100.0%
District Expenditures
Salsipuedes Sanitary District’s total expenditures can be categorized into three budgetary
groups: Administrative and General, Sewerage Treatment & Disposal, and Sewage
Collection. Figure 67 depicts the how funding is distributed by category.
Figure 67: FY 2023-24 Expenditure Breakdown
Sewage Collection
$78,862 (24%)
Administrative and General
$93,756 (28%)
Sewage Treatment and Disposal
$157,252 (48%)
Comprehensive Sanitation Service and Sphere Review Page 149 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $3 million. The following
table highlights the Fund Balance from 2018 to 2025. As Table 98 shows below, the
District has generally experienced an increase in total reserves each year. On average,
total reserves have increased by approximately $156,000 or 8% since 2013. A full review
of the District’s revenues and expenditures from FY 2013-14 to FY 24-25 is shown on
Table 99.
Table 98: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net Position $1,935,487 $2,141,044 $2,293,553 $2,436,050 $2,649,607 $2,858,033 $2,858,033
Change in ($) from
- $205,557 $152,508 $142,497 $213,557 $208,427 -
previous year
Change in (%) from
- 11% 7% 6% 9% 8% -
previous year
Table 99: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUE
Operating Revenue
Sewer Service Charges $ 3 34,605 $ 3 43,747 $ 352,535 $ 374,990 $ 357,786 $ 390,457 $ 393,583 $ 416,210 $ 400,284 $ 424,910 $ 424,117 $ 4 55,844
Miscellaneous Revenue $ - $ 1 ,667 $ 7 05 $ 9 78 $ - $ 5 19 $ - $ - $ - $ - $ - $ -
Operating Revenue Sub-total $ 3 34,605 $ 3 45,414 $ 353,240 $ 375,968 $ 357,786 $ 390,976 $ 393,583 $ 416,210 $ 400,284 $ 424,910 $ 424,117 $ 4 55,844
Non-Operating Revenue
Interest Income $ 2 ,466 $ 3 ,663 $ 5 ,853 $ 9 ,191 $ 1 5,076 $ 2 8,248 $ 3 1,092 $ 1 1,974 $ 8 ,852 $ 3 7,978 $ 8 6,231 $ 2 9,590
Taxes - Property $ 15,601 $ 17,248 $ 1 8,219 $ 1 9,367 $ 2 0,535 $ 2 2,200 $ 2 2,835 $ 2 3,571 $ 2 4,879 $ 2 6,088 $ 2 6,824 $ 2 9,110
Homeowners Property Tax Relief $ 124 $ 130 $ 1 26 $ 1 27 $ 1 25 $ 1 26 $ 1 25 $ 1 22 $ 1 22 $ 1 21 $ 1 24 $ 1 25
Connection Fees $ 1 ,650 $ - $ - $ 6 ,000 $ - $ - $ - $ - $ - $ - $ - $ 3,600
Sewer Inspection and Fees $ 800 $ - $ 4 00 $ 1 ,200 $ 1 8,383 $ - $ - $ 1 ,200 $ 1 ,400 $ 6 00 $ 1 ,000 $ 3,000
Non-Operating Revenue Sub-total $ 20,641 $ 21,041 $ 2 4,598 $ 3 5,885 $ 5 4,119 $ 5 0,574 $ 5 4,052 $ 3 6,868 $ 3 5,253 $ 6 4,787 $ 114,179 $ 6 5,425
Total Revenue $ 3 55,246 $ 3 66,455 $ 377,838 $ 411,853 $ 411,905 $ 441,551 $ 447,635 $ 453,078 $ 435,537 $ 489,697 $ 538,297 $ 5 21,269
EXPENDITURE
Administrative and General
Salaries & Benefits $ 44,090 $ 37,888 $ 3 2,025 $ - $ 3 4,890 $ 4 2,407 $ 3 8,388 $ 4 1,776 $ 4 2,487 $ 4 3,455 $ 4 3,579 $ 4 4,960
Payroll Taxes $ 4 ,022 $ 3 ,405 $ 2 ,917 $ - $ 3 ,268 $ - $ - $ - $ - $ - $ - $ -
Workers' Compensation $ 1 ,583 $ 2 ,147 $ 2 ,344 $ - $ 2 ,294 $ - $ - $ - $ - $ - $ - $ 3,000
Attorney Fees $ 2 ,534 $ 4 ,089 $ 2 00 $ - $ - $ 4 08 $ 2 39 $ 1 ,689 $ 4 ,194 $ - $ 1 62 $ 3,350
Accounting and Auditing Fees $ 7 ,880 $ 8 ,920 $ 9 ,457 $ - $ 1 ,529 $ 8 ,337 $ 1 ,589 $ 5 ,003 $ 5 ,406 $ 1 ,819 $ 1 1,717 $ 1 3,845
Custodial Services $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 5 00
Directors' Fees $ 8 ,090 $ 5 ,210 $ 6 ,100 $ - $ 6 ,400 $ 6 ,500 $ 6 ,800 $ 6 ,450 $ 6 ,200 $ 5 ,550 $ 6 ,250 $ 7,150
Professional and Special Services $ 284 $ - $ - $ - $ - $ 1 ,126 $ 1 ,604 $ 2 ,274 $ 2 ,064 $ 2 ,114 $ 2 ,444 $ 2,350
Telephone $ 2 ,324 $ 2 ,466 $ 2 ,399 $ - $ 2 ,812 $ 2 ,330 $ 2 ,572 $ 2 ,418 $ 2 ,172 $ 2 ,577 $ 2 ,272 $ 3,350
Property Insurance $ 1 ,155 $ 1 ,373 $ 1 ,459 $ - $ 1 ,360 $ 3 ,812 $ 3 ,605 $ 8 ,363 $ 2 ,502 $ 5 ,636 $ 4,000
Utilities $ 1 ,916 $ 2 ,141 $ 2 ,491 $ - $ 3 ,357 $ 4 ,196 $ 2 ,462 $ 2 ,645 $ 2 ,913 $ 3 ,497 $ 3 ,136 $ 3,850
Office Expense - Supplies $ 6 ,506 $ 2 ,421 $ 2 ,584 $ - $ 3 ,405 $ 5 ,146 $ 3 ,112 $ 1 ,985 $ 1 ,639 $ 8 58 $ 1 ,342 $ 2,781
Publication and Legal Notices $ 1 ,461 $ - $ 1 ,177 $ - $ 9 83 $ 3 92 $ 8 53 $ 7 48 $ 6 44 $ - $ 1 ,567 $ 1,350
Rent $ 7 ,620 $ 7 ,720 $ 8 ,220 $ - $ 1 2,000 $ 1 1,000 $ 1 3,000 $ 1 3,201 $ 1 2,430 $ 1 3,800 $ 1 3,580 $ 1 5,350
Election Expense $ 7 5 $ - $ - $ - $ 7 5 $ - $ 7 5 $ - $ - $ - $ - $ 3 89
Travel - Mileage $ 1 ,301 $ 1 ,465 $ 1 ,042 $ - $ 1 ,362 $ 2 ,048 $ 1 ,353 $ 1 ,450 $ 1 ,357 $ 1 ,552 $ 1 ,514 $ 2,781
Contingencies $ - $ - $ - $ - $ - $ 5 39 $ - $ - $ - $ - $ - $ 2 3,000
Contribution to Other Agencies $ 455 $ 505 $ 5 05 $ - $ 5 38 $ - $ 5 87 $ 5 15 $ 5 31 $ 5 01 $ 5 56 $ 4 55
Administrative and General Sub-total $ 91,296 $ 79,750 $ 7 2,920 $ 7 5,209 $ 7 4,273 $ 8 8,243 $ 7 6,237 $ 8 8,516 $ 8 2,038 $ 7 8,225 $ 9 3,756 $ 1 32,461
Sewage Treatment and Disposal
Treatment Plant Operating and Maintenance Contract$ 83,381 $ 83,147 $ 9 5,330 $ 155,783 $ 114,953 $ 9 4,838 $ 129,892 $ 174,395 $ 173,536 $ 164,575 $ 157,252 $ 233,272
Sewage Collection
Maintenance and Repair Projects - Sewer Line - MRO $ 46,782 $ 1 06,961 $ 3 7,444 $ - $ 1 8,821 $ 109,782 $ 35,414 $ 35,879 $ 2 9,683 $ 3 0,791 $ 7 7,147 $ 139,186
Engineering $ 13,659 $ 7 ,346 $ 6,052 $ - $ 3 ,471 $ 3 ,428 $ 5 34 $ 1 ,780 $ 5 ,283 $ 2 ,548 $ 1 ,715 $ 4,350
Sewage Collection Sub-total $ 60,441 $ 1 14,307 $ 4 3,496 $ 4 0,556 $ 2 2,292 $ 113,210 $ 35,948 $ 37,659 $ 3 4,966 $ 3 3,339 $ 7 8,862 $ 143,536
Other Expenses
Capital Improvements $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 1 2,000
Depreciation $ 26,631 $ 26,631 $ 26,631 $ - $ 2 6,676 $ - $ - $ - $ - $ - $ - $ -
Other Expenses Sub-total $ 26,631 $ 26,631 $ 26,631 $ 2 6,631 $ 2 6,676 $ - $ - $ - $ 2 ,500 $ - $ - $ 1 2,000
Total Expenditure $ 2 61,749 $ 3 03,835 $ 238,377 $ 298,179 $ 238,194 $ 296,291 $ 242,078 $ 300,569 $ 293,040 $ 276,140 $ 329,870 $ 5 21,269
Surplus/(Deficit) $ 93,497 $ 62,620 $ 139,461 $ 113,674 $ 173,711 $ 145,260 $ 205,557 $ 152,508 $ 142,497 $ 213,557 $ 208,427 $ -
Net Position - Beginning of Year $ 1,207,264 $ 1,300,761 $ 1 ,363,381 $ 1 ,502,842 $ 1 ,616,516 $ 1 ,790,227 $ 1 ,935,487 $ 2 ,141,044 $ 2 ,293,553 $ 2 ,436,050 $ 2 ,649,607 $ 2,858,033
Net Position - End of Year $ 1,300,761 $ 1,363,381 $ 1 ,502,842 $ 1 ,616,516 $ 1 ,790,227 $ 1 ,935,487 $ 2 ,141,044 $ 2 ,293,553 $ 2 ,436,050 $ 2 ,649,607 $ 2 ,858,033 $ 2,858,033
Comprehensive Sanitation Service and Sphere Review Page 150 of 177
Governance
Salsipuedes Sanitary District is an independent special district governed by a five-
member Board of Directors elected at large by the voters within the District. When
candidates run unopposed, they are appointed by the County Board of Supervisors in lieu
of conducting the election. The current Board is as follows:
Table 100: Board of Directors
Board Member Title Term of Office Expiration
David Ferracane Director 2027
Jenet DeCosta Director 2027
Robert Roberts Director 2027
Allen Rusler Director 2027
Dan Dewig Director 2025
The Board of Directors meet on the third Wednesday of each month at 7:00 PM at the
District’s offices. Public notice is provided through posting. The District contracts for
independent audits.
Infrastructure Management Plans
The State Water Resources Control Board regulates wastewater discharges to surface
water (rivers, ocean, etc.) and to groundwater (via land). The State Water Board requires
sanitation districts to follow the Statewide General Waste Discharge Requirements for
Sanitary Sewer Systems.
The District’s sewer system management plan consists of weekly inspections to both
pump lift stations by a maintenance staff. Regular inspections ensure that wastewater
flow is at adequate levels. Additionally, the District is scheduled for annual flushing.
At present, the District does not have a capital improvement plan. The District’s General
Manager has indicated that the District is developing a CIP plan which will identify future
infrastructure repairs/replacements. The District is currently reviewing grant information
to prepare for costs of future infrastructure needs.
LAFCO Staff Recommendation: The District should consider adopting a long-term
maintenance plan to ensure scheduled and unforeseen repairs, replacements, and
installations are adequately funded.
Comprehensive Sanitation Service and Sphere Review Page 151 of 177
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the District’s website. Table 101 summarizes staff’s findings on
whether the website meets the statutory requirements. At present, the District does meet
most of the statutory requirements set under SB 929 and SDLF’s website transparency
criteria. LAFCO appreciates the recent efforts by the County to revamp the organization’s
website, which included a new webpage specifically for the sewer agencies governed and
managed by the County.
Table 101: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
11. Financial Audits* ✓
12. Archive of Board Meeting Agendas & Minutes* ✓
13. Link to State Controller's Webpages for District's reported
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
16. Home Page Link to Agendas/Board Packets ✓
17. SB 272 - Compliance-Enterprise Catalogs ✓
18. Machine Readable/Searchable Agendas ✓
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews
Total Score (out of a possible 20) 17 (85%)
Comprehensive Sanitation Service and Sphere Review Page 152 of 177
Opportunities & Challenges
Salsipuedes Sanitary District is significantly affected by aging infrastructure, escalating
operational costs, and changes to state laws and regulations that may introduce new
requirements without additional funding. These issues are common with other sanitation
districts in Santa Cruz County. The following section discusses these challenges and
identifies possible opportunities to ensure the delivery of wastewater services in an
efficient and effective manner.
Regional Collaboration
Several sanitation districts, including entities managed and operated by the County, have
expressed interest in transferring sewer responsibilities to another agency due to funding
issues, limited long-term planning, or lack of economies of scale. Establishment of a
countywide memorandum of understanding or a joint powers authority may unify the
already-established collaboration set by the sanitation providers in the county. Such
agreements may also lay the foundation for future changes of organization, including but
not limited to annexations, consolidations, or mergers.
Sphere of Influence
LAFCO originally adopted a sphere of influence for the District back in 1987. The
Commission, at that time, adopted a sphere boundary that goes beyond the District’s
jurisdictional boundary in the north but also excluded areas from being part of the sphere
boundary adjacent to Watsonville’s city limits. The area outside the sphere of influence
but within the District is approximately 60 acres, undeveloped, and primarily used for
agriculture. Figure 68 on page 154 shows the current sphere of influence boundary for
the Salsipuedes Sanitary District.
The current sphere has been in place for almost 40 years without any change or
anticipated action. Therefore, staff is recommending that the Commission adopt a
coterminous sphere to accurately reflect the District’s current service area. Figure 69 on
page 155 shows the proposed sphere boundary.
Comprehensive Sanitation Service and Sphere Review Page 153 of 177
Figure 68: Salsipuedes Sanitary District’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 154 of 177
Figure 69: Salsipuedes Sanitary District’s Proposed Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 155 of 177
District Summary
Salsipuedes Sanitary District
Health and Safety Code §6400 et seq. (Sanitary District Act of
Formation
1923)
Board of Directors Five members, elected at-large to four-year terms
Contact Person Delia N. Brambila, Secretary/Manager
Employees 2 Part-Time Employees
Facilities Collection Plant; 2 pump stations; 512 connections
District Area 7 square miles
Current Sphere: Slightly Larger than the District (i.e. sphere
goes beyond existing jurisdictional boundary)
Sphere of Influence
Proposed Sphere: Coterminous with District’s service area
Total Revenue = $521,269
FY 2024-25 Budget Total Expenditure = $ 521,269
Projected Net Position (Beginning Balance) = $2,858,033
Mailing Address: 739 East Lake Avenue, Suite 2, Watsonville
CA 95076
Phone Number: (831) 722-7760
Contact Information
Email Address: salsisanitary@gmail.com
Website: https://salsipuedessanitary.specialdistrict.org/
The Board of Directors meets on the third Wednesday of each
Public Meetings month at 7:00 PM at the District’s offices. Public noticed is
provided through posting.
Mission Statement None
Comprehensive Sanitation Service and Sphere Review Page 156 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
Salsipuedes Sanitary District serves an unincorporated community northeast of the
City of Watsonville. The population of the District is approximately 2,100. The County
General Plan anticipates very little future growth within the District’s jurisdictional and
sphere of influence boundaries.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within the District.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
Salsipuedes Sanitary District serves 512 connections. It has adequate transmission
and treatment capacity for the present and planned facilities within the sphere of
influence. The District’s principal needs are repair and replacement of aging
infrastructure.
4. Financial ability of agencies to provide services.
Salsipuedes Sanitary District’s financial ability to provide services is well-established.
The District has successfully kept costs below its revenue stream since 2013. As of
June 30, 2024, the District is operating with a net position of approximately $3 million.
5. Status of, and opportunities for, shared facilities.
Salsipuedes Sanitary District has an active contract with the City of Watsonville to
utilize their regional treatment plant. The District should explore other collaborative
efforts with neighboring agencies, which may help to reduce costs and/or maximize
economies of scale.
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
Salsipuedes Sanitary District should consider adopting a long-term maintenance plan
to ensure scheduled and unforeseen repairs, replacements, and installations are
adequately funded.
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Comprehensive Sanitation Service and Sphere Review Page 157 of 177
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
The present and planned land uses in the Salsipuedes Sanitary District are principally
suburban residential and public facilities. There are some neighborhood commercial
uses near the corner of Holohan Road and East Lake Avenue. Rural homes and
agricultural buildings in the southern agricultural portion of the District’s jurisdictional
and sphere boundaries are connected to the District’s mains. The County of Santa
Cruz plans for the southern portion of the District, between Salsipuedes Creek and
the City of Watsonville, to remain in commercial agricultural uses.
2. The present and probable need for public facilities and services in the area.
The present and probable future need for public facilities and services in the
Salsipuedes Sanitary District is the maintenance, repair, and replacement of aging
main lines and pumps.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
Salsipuedes Sanitary District serves 512 connections. It has adequate transmission
and treatment capacity for the present and planned facilities within the District’s
jurisdictional and sphere of influence boundaries. The District’s principal needs are
repair and replacement of aging infrastructure.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The District’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
Salsipuedes Sanitary District’s service or sphere boundaries that meet the definition
of a disadvantaged unincorporated community. That said, the District has adequate
transmission and treatment capacity for the present and planned facilities within the
sphere of influence. The District’s principal needs are repair and replacement of aging
infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 158 of 177
SANTA CRUZ COUNTY SANITATION DISTRICT
District Overview
The Santa Cruz County Sanitation District provides wastewater collection service for the
City of Capitola and the unincorporated communities of Aptos, Soquel and Live Oak. The
District also serves Harbor High School, a satellite medical center and the Port District
which are within the City of Santa Cruz and outside the District’s boundary. The District
receives periodic inquiries regarding sewer service in the La Selva Beach area due to
septic problems in that area, but that area lies outside its current sphere of influence.
Figure 70, on page 160, is a vicinity map of the service area. Appendix K provides a
copy of the formation resolution.
The Santa Cruz County Sanitation District was formed in 1973 by the consolidation of
three sanitation districts: East Cliff, Capitola, and Aptos. At that time each district had a
primary treatment plant and ocean outfall into Monterey Bay. The discharges did not meet
either the Federal or State clean water standards. During the 1970s the District
participated in regional sewer studies and ultimately acted to abandon its treatment plants
and outfall, build a transmission line into the City of Santa Cruz, and contract with the city
to treat and dispose of the district’s sewage. The city built a new outfall in 1989 and added
secondary treatment in 1998.
Population & Growth
There are no growth projections available for the Santa Cruz County Sanitation District.
In general, the Santa Cruz County unincorporated area is projected to have slow growth
over the next fifteen years. However, the District also includes the entire City of Capitola.
Based on the growth rate of approximately 1% for the unincorporated areas in the County,
LAFCO staff projects that the District’s entire population in 2040 will be around 76,500.
The projected population for the Santa Cruz County Sanitation District are as follows:
Table 102: Projected Population
2025 2030 2035 2040 Growth Rate
Santa Cruz County
137,896 139,105 140,356 141,645 0.86%
(unincorporated)
City of Capitola 10,312 10,451 10,622 10,809 1.48%
Santa Cruz County
73,894 74,756 75,628 76,510 1.17%
Sanitation District
Source: AMBAG 2018 Regional Growth Forecast
Infrastructure Summary
Santa Cruz County Sanitation District operates a collection system and serves about
72,000 residents. It currently has 36,000 connections and approximately 200 miles of
sewer line. Table 103 provides an overview of the type of service and current
infrastructure:
Table 103: Infrastructure Summary
Type of Treatment No. of No. of Lift Miles of
System Level Connections Stations Sewer Line
Santa Cruz County
Collection N/A 36,000 35 220.0
Sanitation District
Comprehensive Sanitation Service and Sphere Review Page 159 of 177
Figure 70: Santa Cruz County Sanitation District’s Vicinity Map
Comprehensive Sanitation Service and Sphere Review Page 160 of 177
Services & Operations
The Santa Cruz County Sanitation District includes the following areas in the County with
sewer service: Aptos, Capitola, Soquel, and Live Oak. The District collection system is
pumped to the City of Santa Cruz POTW for treatment. The District is required to comply
with the requirements of the City of Santa Cruz NPDES permit NO. CA0048194. The main
pump station along the transmission main is located at the D. A. Porath Facility at 2750
Lode Street off 26th Avenue in Live Oak. That facility pumps sewage from the entire
District before it is pumped to the City of Santa Cruz for treatment. The District uses a
Supervisory Control and Data Acquisition (SCADA) system to remotely monitor its
pumping stations.
The volume of wastewater is determined from records of water usage as metered by the
Santa Cruz City Water Department (their jurisdiction within the Santa Cruz County
Sanitation District covers the Live Oak area from Lake Avenue on the east side of the
Yacht Harbor to 41st Avenue) and Soquel Creek Water District (from 41st Avenue to San
Andreas Road). Due to the lead time involved in getting the yearly sewer charges placed
on the County property tax statements, the current fiscal year's charges are based on
water use and strength factors from the previous calendar year.
Sewer Rates
At present, the District’s annual sewer rates derive from five user classes: Single-Family
Units, Multi-Family Units, Mobile Homes, Commercial, and Schools. Each user class has
its own sewer rate. Table 104 shows the gradual increase in annual rates.
Table 104: Annual Sewer Rates
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Single-Family $783.00 $824.16 $846.96 $880.92 $939.96 $997.56 $1,073.28
Multi-Family $676.80 $712.80 $731.76 $762.48 $812.28 $861.36 $923.52
Mobile Homes $581.04 $612.48 $628.20 $655.80 $697.44 $738.84 $788.64
Commercial $353.88 $368.40 $351.36 $372.48 $390.12 $407.64 $427.08
$8.25 - $8.43 - $8.97 - $9.05 - $9.63 - $13.63 - $11.24 -
Additional Charge (HCF)*
$13.20 $13.40 $13.95 $13.74 $15.32 $24.63 $40.56
School* $353.88 $368.40 $351.36 $372.48 $390.12 $407.64 $427.08
$7.97 - $8.43 - $8.97 - $9.05 - $9.63- $13.63 - $11.24 -
Additional Charge (ADA)*
$31.95 $33.82 $35.50 $36.30 $34.75 $36.89 $40.56
Note: Additional Charge is for “Commercial” is per Hundred Cubic Feet of Water (HCF); Additional Charge
is for “School” is per Average Daily Attendance (ADA)
Using information supplied by District staff, the rates are reviewed each year by an
independent engineering firm which specializes in revenue studies for utility districts and
are subject to final approval by the Board. Before the rates are set, a notice of public
hearing is mailed to all owners of property within the Sanitation District boundaries,
another notice is published in the Santa Cruz Sentinel, and the public hearing is held. The
public hearing is normally scheduled in April or May of each year, with the rates becoming
effective on the first of July. Customers are encouraged to participate in the public
hearings and can send written comments to the attention of the District Engineer.
The following tables (Tables 105 to 109) show the gradual increase in annual rates for
each area. Please note that FY 24-25 data was not available for LAFCO’s analysis.
Comprehensive Sanitation Service and Sphere Review Page 161 of 177
Table 105: Single-Family Unit’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Single
$783.00 $824.16 $846.96 $880.92 $939.96 $997.56 $1,073.28
Family
Change
$41.16 $22.80 $33.96 $59.04 $57.60 $75.72 $37.72
($)
Change
5% 3% 4% 7% 6% 8% 8%
(%)
Table 106: Multi-Family Unit’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Multi-
$676.80 $712.80 $731.76 $762.48 $812.28 $861.36 $923.52
Family
Change
$36.00 $18.96 $30.72 $49.80 $49.08 $62.16 $34.24
($)
Change
5% 3% 4% 7% 6% 7% 7%
(%)
Table 107: Mobile Home Unit’s Annual Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Mobile
$581.04 $612.48 $628.20 $655.80 $697.44 $738.84 $788.64
Homes
Change
$31.44 $15.72 $27.60 $41.64 $41.40 $49.80 $28.72
($)
Change
5% 3% 4% 6% 6% 7% 7%
(%)
Table 108: Commercial’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
Commercial $353.88 $368.40 $351.36 $372.48 $390.12 $407.64 $427.08
Change
$14.52 -$17.04 $21.12 $17.64 $17.52 $19.44 $16.04
($)
Change
4% -5% 6% 5% 4% 5% 5%
(%)
Table 109: School’s Annual Flat Sewer Rates Review
Average
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
Change
School $353.88 $368.40 $351.36 $372.48 $390.12 $407.64 $427.08
Change
$14.52 -$17.04 $21.12 $17.64 $17.52 $19.44 $16.04
($)
Change
4% -5% 6% 5% 4% 5% 5%
(%)
Comprehensive Sanitation Service and Sphere Review Page 162 of 177
When comparing the sewer rates with the other sanitation districts analyzed in this report,
Santa Cruz County Sanitation District is ranked fourth in charges for single family units
($1,073.28/year), ranked the third lowest in charges for multi-family units ($923.52/year)
and ranked the lowest in charges to mobile home units ($788.64/year). Using a general
business with a water usage of 192 hundred cubic feet of annual water usage, SCCSD’s
commercial charges are ranked the third lowest ($2,873/year). When comparing schools
with 135 students, SCCSD ranked second highest compared to school sites in other
Districts/CSAs ($4,133/year). Sewer rate comparisons are shown in the following figures
(Figures 71 to 75).
Figure 71: Annual Sewer Rates for Single-Family Units
$4,500.00
$4,000.00
$3,500.00
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$1,073.28
$1,000.00
$500.00
$0.00
Freedom Santa Cruz Davenport
CSA 10 Salsipuedes CSA 2 CSA 5 CSA 7 Bear Creek CSA 20
Co Co Co
Single Family $323.11 $782.16 $882.76 $1,073.28 $1,517.64 $2,109.91 $2,383.28 $2,747.51 $3,277.92 $4,178.67
Figure 72: Annual Sewer Rates for Multi-Family Units
$3,000.00
$2,500.00
$2,000.00
$1,500.00
$923.52
$1,000.00
$500.00
$0.00
Freedom Co Salsipuedes Santa Cruz Co CSA 2 CSA 5 CSA 7
Single Family $576.66 $586.68 $923.52 $1,411.19 $2,069.37 $2,477.10
Comprehensive Sanitation Service and Sphere Review Page 163 of 177
Figure 73: Annual Sewer Rates for Mobile Home Units
$900.00 $890.42
$880.00
$860.00
$840.00
$820.00
$800.00 $788.64
$780.00
$760.00
$740.00
$720.00
Santa Cruz Co Freedom Co
Figure 74: Annual Sewer Rates for Commercial Sites
$7,000.00
$6,215.35
$6,000.00
$4,823.00
$5,000.00
$4,000.00 $3,642.29
$2,872.56
$3,000.00
$1,756.66
$2,000.00
$1,000.00
$152.88
$0.00
Salsipuedes Freedom Co Santa Cruz Co CSA 7 Davenport Co CSA 10
Figure 75: Annual Sewer Rates for School Sites
$9,000.00
$8,000.00 $7,635.20
$7,000.00
$6,000.00
$5,000.00
$4,132.89
$4,000.00
$2,839.57
$3,000.00
$2,000.00
$661.72
$1,000.00
$82.32
$0.00
Salsipuedes CSA 10 Freedom Co Santa Cruz Co Davenport Co
Comprehensive Sanitation Service and Sphere Review Page 164 of 177
Finances
This section will highlight the District’s audited financial performance during the most
recent fiscal years. Fiscal Year 2023-24 is the latest audited financial statement available.
A comprehensive analysis of the District’s financial performance during the past 12 years
is shown in Table 111 on page 167.
At the end of Fiscal Year 2023-24, total revenue collected was approximately $35 million,
representing a 5% increase from the previous year ($33 million in FY 22-23). Total
expenses for FY 2023-24 were approximately $31 million, which increased from the
previous year by 5% ($29 million in FY 22-23). During LAFCO’s last service review
analysis in 2019, the District experienced an annual surplus in four of the five fiscal years
(FY 13-14 to FY 17-18). During this service review cycle, the District continued that
positive trend by completing six consecutive annual surpluses in the past six years (FY
18-19 to FY 23-24), as shown in Figure 76 below. LAFCO staff believes that the District
will continue to operate effectively due to its stable revenue stream and stagnant
expenditures.
Comprehensive Sanitation Service and Sphere Review Page 165 of 177
437,465,22$ 723,896,22$ 534,047,22$
093,394,91$
631,413,52$
595,158,12$
560,923,42$
147,093,02$
578,530,62$
492,663,32$
836,897,52$
364,169,32$
911,954,82$
679,075,42$
541,783,82$
759,668,62$
650,391,92$
476,189,62$
133,089,23$
514,824,92$
095,927,43$
355,588,03$
013,368,04$
998,856,03$
Figure 76: Statement of Revenues & Expenditures
$45,000,000
$40,000,000
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$-
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
Total Revenue Total Expenditure
District Revenues
The District’s primary source of revenue is from Charges for Services. In FY 2023-24, the
District received revenue from three different sources: Charges for Services, Interest
Income, and Gain on Sale of Capital Assets. On average, the District receives
approximately $26 million each year in service fees. Figure 77 highlights the total revenue
received in FY 2023-24.
Figure 77: FY 2023-24 Revenue Breakdown
Investment Income
$1,680,572 (4.84%)
Gain on Sale of Capital Assets
$6,125 (0.02%)
Charges for Services
$33,042,893 (95.14%)
District Expenditures
The District’s total expenditures can be categorized into four budgetary groups: General
& Administrative, Services & Supplies, Interest Expense, and Depreciation, as shown in
Figure 78.
Figure 78: FY 2023-24 Expenditure Breakdown
Depreciation
General and Administrative,
$6,353,525 (21%)
$6,968,447 (23%)
Interest Expense & Related Fees
$1,715,818 (5%)
Services and Supplies
$15,847,763 (51%)
Comprehensive Sanitation Service and Sphere Review Page 166 of 177
Fund Balance/Net Position
As of June 30, 2024, the total fund balance is approximately $151 million. The following
table highlights the Fund Balance from 2018 to 2025. As Table 110 shows below, the
District has generally experienced an increase in total reserves each year. On average,
total reserves have decreased by approximately $2.9 million or 2% between FY 13-14 to
FY 23-24. A full review of the District’s revenues and expenditures from FY 2013-14 to
FY 24-25 is shown on Table 111.
Table 110: Fund Balance/Net Position
FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audited) (Audited) (Audited) (Audited) (Audited) (Audited) (Budget)
Net
$135,574,234 $139,462,377 $140,982,565 $143,193,947 $146,745,863 $150,589,900 $160,749,311
Position
Change in
($) from
$3,888,143 $1,520,188 $2,211,382 $3,551,916 $3,844,037 $10,204,411
previous
year
Change in
(%) from
3% 1% 2% 2% 3% 7%
previous
year
Table 111: Total Revenues & Expenditures
FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25
(Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Audit) (Budget)
REVENUES
Charges for Services $ 21,977,224 $ 2 2,412,016 $ 2 3,491,067 $ 23,814,123 $ 24,758,144 $ 25,664,972 $ 27,096,778 $ 27,780,566 $ 29,088,620 $ 31,679,491 $ 33,042,893 $ 40,750,390
Special Assessments $ 93,064 $ 9 0,297 $ 9 1,598 $ 91,703 $ 9 1,348 $ ( 129,567) $ - $ - $ - $ - $ - $ -
Aid from Other Government Agencies $ 21,898 $ 1 ,586,016 $ 307,000 $ 965,497 $ - $ 1 ,160,140 $ 514,482 $ 104,436 $ 189,673 $ - $ -
Investment Income $ 229,497 $ 1 53,593 $ 1 44,855 $ 116,239 $ 220,886 $ 263,233 $ 202,201 $ 9 2,097 $ - $ 1,101,758 $ 1,680,572 $ 1 12,920
Contributions and Donations $ 238,396 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
Gain on Sale of Capital Assets $ 4,655 $ 8 4,529 $ 6 00 $ - $ - $ - $ - $ - $ - $ 9 ,409 $ 6,125 $ -
Total Revenue $ 2 2,564,734 $ 2 2,740,435 $ 2 5,314,136 $ 2 4,329,065 $ 26,035,875 $ 25,798,638 $ 28,459,119 $ 28,387,145 $ 29,193,056 $ 32,980,331 $ 3 4,729,590 $ 4 0,863,310
EXPENDITURES
General and Administrative $ 4,438,926 $ 4 ,639,987 $ 5 ,331,941 $ 5,357,032 $ 5 ,434,920 $ 5 ,771,734 $ 6 ,114,191 $ 6 ,163,848 $ 6 ,296,211 $ 6 ,894,506 $ 6,968,447 $ -
Services and Supplies $ 12,971,877 $ 9 ,545,195 $ 1 1,784,103 $ 9,817,855 $ 12,444,069 $ 12,869,924 $ 12,675,255 $ 14,699,556 $ 13,570,675 $ 15,054,640 $ 15,847,763 $ 27,992,035
Bond Interest and Related Fees $ 855,013 $ 6 71,143 $ 4 01,514 $ 447,909 $ 298,209 $ 231,732 $ 452,935 $ 510,219 $ 1 ,000,241 $ 1 ,303,947 $ - $ 2,666,864
Loss on Sale of Capital Assets $ - $ - $ - $ - $ 6 6,796 $ - $ 9 ,245 $ - $ - $ - $ - $ -
Interest Expense & Related Fees $ - $ - $ - $ - $ - $ - $ - $ - $ 430,016 $ - $ 1,715,818 $ -
Depreciation $ 4,432,511 $ 4 ,637,065 $ 4 ,334,037 $ 4 ,767,945 $ 5 ,122,300 $ 5 ,088,073 $ 5 ,319,350 $ 5 ,493,334 $ 5 ,684,531 $ 6 ,175,322 $ 6 ,353,525 $ -
Total Expenditure $ 2 2,698,327 $ 1 9,493,390 $ 2 1,851,595 $ 2 0,390,741 $ 23,366,294 $ 23,961,463 $ 24,570,976 $ 26,866,957 $ 26,981,674 $ 29,428,415 $ 3 0,885,553 $ 3 0,658,899
Surplus/(Deficit) $ (133,593) $ 3 ,247,045 $ 3 ,462,541 $ 3,938,324 $ 2 ,669,581 $ 1 ,837,175 $ 3 ,888,143 $ 1 ,520,188 $ 2 ,211,382 $ 3 ,551,916 $ 3,844,037 $ 10,204,411
Net Position - Beginning $ 121,523,635 $ 121,390,042 $ 123,666,613 $ 127,129,154 $ 131,067,478 $ 133,737,059 $ 135,574,234 $ 139,462,377 $ 140,982,565 $ 143,193,947 $ 146,745,863 $ 150,589,900
Net Position - Ending $ 121,390,042 $ 124,637,087 $ 127,129,154 $ 131,067,478 $ 133,737,059 $ 135,574,234 $ 139,462,377 $ 140,982,565 $ 143,193,947 $ 146,745,863 $ 150,589,900 $ 160,794,311
RESERVES
Revenue Trust Reserves $ 3,617,413 $ 4,246,905 $ 4,866,765 $ 3,434,705 $ 3 ,836,858 $ 3 ,736,949 $ 3 ,659,894 $ 3 ,705,097 $ 3 ,556,912 $ 3 ,453,638 $ 12,823,612 $ 3,458,418
2005 Bond Payment Reserves Fund $ 969,937 $ 9 69,937 $ 9 69,937 $ 969,937 $ 969,937 Debt Paid Off
SRF Debt Reserve Fund (136419) $ - $ - $ - $ - $ - $ - $ - $ - $ 791,029 $ 805,304 $ 8 36,024 $ 8 72,487
IBANK Reserve Fund $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 271,357 $ 2 77,779 $ 2 89,985
SRF Debt Reserve Fund (625174) $ - $ - $ - $ - $ - $ - $ - $ - $ 5 3,226 $ 5 4,187 $ 56,254 $ 1 26,007
SRF Debt Resere Fund (625178) $ - $ - $ - $ - $ - $ - $ - $ 218,469 $ 491,072 $ 228,577 $ 2 41,226 $ 2 52,127
The District has made the change to have the reserve funds restricted so the funds
budgeted will remain in the reserve accounts each year. For FY25-26, the budgeted
reserves in the revenue trust account is $3.6M; this amount is planned to be increased
by a minimum of $100,000 per year, with $300,000 being proposed annually for the
next five years.
Comprehensive Sanitation Service and Sphere Review Page 167 of 177
Governance
The Santa Cruz County Sanitation District operates under the authority of the County
Sanitation District Act. The Board consists of the Mayor of Capitola (or his or her council
representative) and the County Supervisors representing the 1st and 2nd Districts. The
current Board is as follows:
Table 112: Board of Directors
Years of Term of Office
Board Member Title
Service Expiration
Next Election:
Kimberly De Serpa Director 2nd District First Year
Primary 2028
Next Election:
Manu Koenig Director 1st District 4 years
Primary 2028
Next Election:
Joe Clarke Chairperson First Year
Primary 2026
Next Election:
Gerry Jensen Alternate Director First Year
Primary 2028
Next Election:
Jacques Bertrand Alternate Director 6 years
April 2029
Board members receive $100 compensation per meeting. The Board’s meeting room is
located at the D.A. Porath Facility, 2750 Lode Street, Santa Cruz. The Board’s regular
meeting dates are the first and third Thursday of the month at 4:45 p.m. Public notice is
provided through posting. The District contracts for independent audits.
The County of Santa Cruz Public Works Division is responsible for the administration,
engineering, maintenance, emergency response and construction of all County sanitation
services. The division also manages various Board-governed special districts and CSAs.
The Sanitation Operations unit is one of six organizational units within the Special
Services Division of Public Works and provides operation and maintenance services to
County sanitation districts and CSAs. Sanitation operations employees work in all
Districts and CSAs. Each sanitation district is governed according to its specific code of
regulations. The Districts’ codes are very similar, and some sections are adopted by
reference from the Santa Cruz County Sanitation District Code. CSAs are governed
according to the Santa Cruz County Code of Regulations.
Website Requirements
Senate Bill 929 was signed into law in September 2018 and requires all independent
special districts to have and maintain a website by January 1, 2020. SB 929 identifies a
number of components that must be found within an agency’s website. Additionally, the
Special District Leadership Foundation (SDLF), an independent, non-profit organization
formed to promote good governance and best practices among California’s special
districts, has also outlined recommended website elements as part of its District
Transparency Certificate of Excellence. This program was created in an effort to promote
transparency in the operations and governance of special districts to the public and to
provide special districts with an opportunity to showcase their efforts in transparency.
Based on SB 929’s criteria and the recommendations set by the SDLF, LAFCO conducted
a thorough review of the District’s website (even though said law only applies to
Comprehensive Sanitation Service and Sphere Review Page 168 of 177
independent special districts). Table 113 summarizes staff’s findings on whether the
website meets the statutory requirements. At present, the District does meet the statutory
requirements set under SB 929 and SDLF’s website transparency criteria. LAFCO
appreciates the recent efforts by the County to revamp the organization’s website, which
included a new webpage specifically for the sewer agencies governed and managed by
the County.
Table 113: Website Transparency
Website Components Checkmark (Yes)
Required Items (SB 949 Criteria and SDLF Benchmarks)
1. Names and Contact Information of Board Members* ✓
2. Board Member Term Limits ✓
3. Names of Key Staff, including General Manager ✓
4. Contact Information for Staff ✓
5. Election/Appointment Procedure & Deadlines ✓
6. Board Meeting Schedule* ✓
7. Mission Statement ✓
8. Description of District's Services/Functions and Service Area ✓
9. Authorizing Statute/Enabling Act ✓
10. Adopted District Budgets* ✓
✓
11. Financial Audits*
✓
12. Archive of Board Meeting Agendas & Minutes*
13. Link to State Controller's Webpages for District's reported ✓
Board Member and Staff Compensation
14. Link to State Controller's Webpages for District's reported
✓
Financial Transaction Report
15. Reimbursement & Compensation Policy / Annual Policies ✓
✓
16. Home Page Link to Agendas/Board Packets
✓
17. SB 272 - Compliance-Enterprise Catalogs
✓
18. Machine Readable/Searchable Agendas
19. Recipients of Grant Funding or Assistance ✓
20. Link or Copies of LAFCO’s Service & Sphere Reviews
Total Score (out of a possible 20) 20 (100%)
Comprehensive Sanitation Service and Sphere Review Page 169 of 177
Opportunities & Challenges
The Santa Cruz County Sanitation District is significantly affected by aging infrastructure,
escalating operational costs, and changes to state laws and regulations that may
introduce new requirements without additional funding. These issues are common with
other sanitation districts in Santa Cruz County. The following section discusses these
challenges and identifies possible opportunities to ensure the delivery of wastewater
services in an efficient and effective manner.
Awards / Recognitions
In 2022, SCCSD was recognized as Small Collection System of the Year by the California
Water Environment Association Monterey Bay Section and in 2023 SCCSD placed third
at the State level. The award recognizes outstanding maintenance programs, regulatory
compliance and safety and training procedures.
Urban Services Line
The County General Plan, the Local Coastal Program Land Use Plan and Chapter 17.01
SCCC (Growth Management) requires the County to preserve a distinction between
urban and rural areas, to encourage the location of new development in urban areas, and
to protect agricultural land and natural resources in rural areas. These policies are
supported by the establishment of a rural services line (RSL) and an Urban Services Line
(USL) to define areas which are or have the potential to be urban and areas which are
and should remain rural. The establishment of distinct urban boundaries serves the
following purposes:
• To administer separate urban and rural growth rates and the allocation of
residential building permits;
• To encourage residential development to locate in urban areas and to discourage
division of land in rural areas;
• To develop and apply different policies governing urban and rural development;
• To provide a basis for a County capital improvements program;
• To coordinate planning for the public services among the County, cities, special
districts, and the Local Agency Formation Commission (LAFCO);
• To ensure that urban development proceeds at a pace consistent with the
provision of urban public services; and
• To limit the extension of urban services to those areas within the rural services line
in the Coastal Zone. [Ord. 4416 § 27, 1996; Ord. 4406 § 27, 1996; Ord. 3327 § 1,
1982; Ord. 2657, 1979].
It is important to note that the Urban Services Line was developed and managed by the
County, not LAFCO. Historically, LAFCO staff receives inquiries from confused
landowners who are interested in connecting to the Santa Cruz County Sanitation District
but are unfamiliar with the Urban Services Line restrictions. A primary reason for such
confusion is the inconsistency between the District’s jurisdictional and sphere boundaries
and the Urban Services Line, as shown on the map on page 172 (refer to Figure 79).
Comprehensive Sanitation Service and Sphere Review Page 170 of 177
The Santa Cruz County Sanitation District’s northern boundary does not match the
County Urban Services Line. In some cases, before the adoption of the Urban Services
Line in 1979, the District annexed strips of land up into the lower elevations of Santa Cruz
Mountains. The Urban Services Line was subsequently adopted closer to the urbanized
and sewer areas of the Mid-County. The current County General Plan does not envision
urban or suburban development occurring further than the Urban Services Line at the
edge of the mountains, and the County and District may want to propose detachments of
the areas within the district boundary that are unsewered and beyond the Urban Services
Line.
In other cases, there are areas within the Urban Services Line and the adopted District
Sphere of Influence that are not within the County Sanitation District’s boundaries. The
current practice is for individual property owners to apply for annexation either when a
septic system fails at an existing house, or when the planning approvals are secured for
new development. The County and District may want to propose wholesale annexations
of areas within the Urban Service Area that are developed or are planned for development
at a density that only utilizes sanitary sewers.
Sphere of Influence
LAFCO originally adopted a sphere of influence for the Santa Cruz County Sanitation
District on October 5, 1983. The main theme of that sphere boundary was to utilize the
County’s Urban Services Line as the primary tool to locate the sphere line. Sanitary sewer
is perhaps the clearest example of an “urban service.” The adopted sphere of influence
line included the areas of the District in Live Oak, Capitola, Soquel, and Aptos and many
developed and undeveloped areas of Live Oak (Santa Cruz Gardens), Soquel, and Aptos
that were inside the Urban Services Line, but not yet annexed or connected for sewer
service. Figure 79 on page 173 shows the current sphere boundary.
The 1983 sphere excluded a series of unserved rural areas in the lower Santa Cruz
Mountains above Live Oak, Soquel, and Aptos that were outside the Urban Services Line,
but had annexed to the Sanitation District, by its predecessor district during the 1950s,
1960s, and 1970s. To ensure that the sphere boundary accurately reflects the District’s
service area and reduces the confusion on where the District can provide services, staff
is recommending that the Commission amend the sphere to be generally coterminous
with the District’s current jurisdictional boundary. Figure 80 on page 173 shows the
proposed sphere of influence boundary for the Santa Cruz County Sanitation District.
Comprehensive Sanitation Service and Sphere Review Page 171 of 177
Figure 79: Santa Cruz County Sanitation District’s Current Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 172 of 177
Figure 80: Santa Cruz County Sanitation District’s Proposed Sphere Map
Comprehensive Sanitation Service and Sphere Review Page 173 of 177
District Summary
Santa Cruz County Sanitation District
County Sanitation District Act (Health and Safety Code
Formation
Sections 4700-4858)
Three-member board; two County Board of Supervisors and
Board of Directors
one Capitola City Council Member.
Matt Machado, Deputy CAO/Director of Community
Contact Person
Development and Infrastructure
Employees 52 full-time employees (approximately)
Facilities Collection Plant; 35 pump stations; 36,000 connections
District Area 870 acres (1.36 square mile)
Slightly larger than the District in the south-eastern side (i.e.
Sphere of Influence
sphere goes beyond existing jurisdictional boundary); and
Total Revenue = $40,863,310
FY 2024-25 Budget Total Expenditure = $30,658,899
Projected Net Position (Beginning Balance) = $160,794,311
Mailing Address: 701 Ocean Street, Room 410 Santa Cruz CA
95060
Phone Number: (831) 454-2160
Contact Information
Email Address: Matt.Machado@santacruzcountyca.gov
Website: http://dpw.co.santa-cruz.ca.us/Home/SewerWater.aspx
The Board’s regular meeting dates are the first and third
Public Meetings Thursday of the month at 4:45 p.m. Meetings are held at 2750
Lode Street, Santa Cruz.
“The purpose of the District is to construct and maintain
pipelines transporting waste from the District to the Wastewater
Treatment Facility, as well as to provide instruction, services,
and monitoring for environmental compliance. To accomplish
Mission Statement this last item, the District’s Environmental Compliance Unit
conducts programs to educate residents, professionals, and
business owners about the proper use of their sewer and
drainage systems in order to help preserve their own, as well
as the District’s facilities and to help protect the environment.”
Comprehensive Sanitation Service and Sphere Review Page 174 of 177
Service and Sphere Review Determinations
The following service and sphere review determinations fulfill the requirements outlined
in the Cortese-Knox-Hertzberg Act.
Service Determinations
Government Code Section 56430 requires LAFCO to conduct a service review before, or
in conjunction with, an action to establish or update a sphere of influence. Written
statements of determination must be prepared with respect to each of the following:
1. Growth and population projections for the affected area.
There are no growth projections available for the Santa Cruz County Sanitation
District. In general, the Santa Cruz County unincorporated area is projected to have
slow growth over the next fifteen years. However, the District also includes the entire
City of Capitola. Based on the growth rate of approximately 1% for the unincorporated
areas in the County, LAFCO staff projects that the District’s entire population in 2040
will be around 76,500.
2. The location and characteristics of any disadvantaged unincorporated
communities within or contiguous to the sphere of influence.
In 2025, the California statewide annual median household income was $109,266,
and 80% of that is $87,413. Based on the criteria set forth by SB 244, staff’s analysis
indicated that there are no DUCs within the District.
3. Present and planned capacity of public facilities, adequacy of public services,
and infrastructure needs or deficiencies including needs or deficiencies related
to sewers, municipal and industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or contiguous to the sphere
of influence.
The Santa Cruz County Sanitation District provides wastewater collection service for
the City of Capitola and the unincorporated communities of Aptos, Soquel and Live
Oak. The District also serves Harbor High School, a satellite medical center and the
Port District which are within the City of Santa Cruz and outside the District’s
boundary. The District receives periodic inquiries regarding sewer service in the La
Selva Beach area due to septic problems in that area, but that area lies outside its
current sphere of influence. The Santa Cruz County Sanitation District was formed in
1973 by the consolidation of three sanitation districts: East Cliff, Capitola, and Aptos.
At that time each district had a primary treatment plant and ocean outfall into Monterey
Bay. The discharges did not meet either the Federal or State clean water standards.
During the 1970s the District participated in regional sewer studies and ultimately
acted to abandon its treatment plants and outfall, build a transmission line into the City
of Santa Cruz, and contract with the city to treat and dispose of the District’s sewage.
The city built a new outfall in 1989 and added secondary treatment in 1998.
4. Financial ability of agencies to provide services.
The Santa Cruz County Sanitation District continues to experience annual surpluses.
LAFCO staff projects that this positive trend will continue. As of June 30, 2024, the
District is operating with a net position of approximately $151 million.
5. Status of, and opportunities for, shared facilities.
The County manages and operates eight of the ten sanitation districts countywide.
This allows for the opportunity for economies of scale, maximizing existing resources
and staffing, and promoting best practices.
Comprehensive Sanitation Service and Sphere Review Page 175 of 177
6. Accountability for community service needs, including governmental structure
and operational efficiencies.
The Santa Cruz County Sanitation District provides wastewater collection service for
the City of Capitola and the unincorporated communities of Aptos, Soquel and Live
Oak. The District also serves a high school, a medical center and the Port District that
are outside the County boundaries.
7. Any other matter related to effective or efficient service delivery, as required by
commission policy.
No additional local LAFCO policies are specifically relevant to this service and sphere
review.
Sphere Determinations
Government Code Section 56425 requires LAFCO to periodically review and update
spheres in concert with conducting municipal service reviews. Spheres are used as
regional planning tools to discourage urban sprawl and encourage orderly growth. Written
statements of determination must be prepared with respect to each of the following:
1. The present and planned land uses in the area, including agricultural and open-
space lands.
There are no agricultural or open-space lands within the service area.
2. The present and probable need for public facilities and services in the area.
The Santa Cruz County Sanitation District provides wastewater collection service for
the City of Capitola and the unincorporated communities of Aptos, Soquel and Live
Oak. The District also serves Harbor High School, a satellite medical center and the
Port District which are within the City of Santa Cruz and outside the District’s
boundary. The District currently has approximately 36,000 connections and serves
over 73,000 residents.
3. The present capacity of public facilities and adequacy of public services that
the agency provides or is authorized to provide.
LAFCO originally adopted a sphere of influence for the Santa Cruz County Sanitation
District back in 1983. Staff is recommending that the Commission modify the sphere
boundary to better reflect the District’s current service area.
4. The existence of any social or economic communities of interest in the area if
the commission determines that they are relevant to the agency.
LAFCO staff is not aware of any social or economic communities of interest in the
area. The CSA’s service area is primarily residential units.
5. For an update of a sphere of influence of a city or special district that provides
public facilities or services related to sewers, municipal and industrial water, or
structural fire protection, that occurs pursuant to subdivision (g) on or after July
1, 2012, the present and probable need for those public facilities and services
of any disadvantaged unincorporated communities within the existing sphere
of influence.
Neither the County nor LAFCO has identified any sub-area within or contiguous to the
District’s service or sphere boundaries that meet the definition of a disadvantaged
unincorporated community. That said, the District has adequate transmission and
treatment capacity (at the City of Santa Cruz’s Wastewater Treatment Plant) for the
present and planned facilities within the sphere of influence. The District’s principal
needs are repair and replacement of aging infrastructure.
Comprehensive Sanitation Service and Sphere Review Page 176 of 177
APPENDICES
A. Bear Creek Estates Wastewater System – Formation Document
B. CSA 2 (Place de Mer) – Formation Resolution
C. CSA 5 (Sand Dollar/Canon del Sol) – Formation Resolution
D. CSA 7 (Boulder Creek) – Formation Resolution
E. CSA 7 (Zone 2) – Formation Resolution
F. CSA 10 (Rolling Woods/Graham Hill) – Formation Resolution
G. CSA 20 (Trestle Beach) – Formation Resolution
H. Davenport County Sanitation District – Formation Resolution
I. Freedom County Sanitation District – Formation Resolution
J. Salsipuedes Sanitary District – Formation Resolution
K. Santa Cruz County Sanitation District – Formation Resolution
Comprehensive Sanitation Service and Sphere Review Page 177 of 177
APPENDIX A:
BEAR CREEK ESTATES
WASTEWATER SYSTEM
(FORMATION DOCUMENT)
APPENDIX B:
COUNTY SERVICE AREA 2
(FORMATION RESOLUTION)
APPENDIX C:
COUNTY SERVICE AREA 5
(FORMATION RESOLUTION)
APPENDIX D:
COUNTY SERVICE AREA 7
ZONE 1
(FORMATION RESOLUTION)
APPENDIX E:
COUNTY SERVICE AREA 7
ZONE 2
(FORMATION RESOLUTION)
BEFORE THE BOARD OF SUPERVISORS
OF THE COUNTY OF SANTA CRUZ, STATE OF CALIFORNIA
RESOLUTION NO.
On the motion of Supervisor :
Duly seconded by Supervisor :
The following resolution is adopted:
RESOLUTION AUTHORIZING THE CREATION OF ZONES WITHIN
COUNTY SERVICE AREA NO. 7 BOULDER CREEK
WHEREAS, this Board, by its Resolution No. 54-2024, adopted March 12,
2024, declared its intention to create zones 1 and 2 within County Service Area
No. 7, Boulder Creek as shown on Exhibit 1 attached hereto, and with proper
notice set April 30, 2024, at 9:00 a.m. or thereafter, as the time for hearing on
said matter; and
WHEREAS, at this time and place fixed, with no majority protest; and
WHEREAS, pursuant to California Government Code 25210.30 et seq.,
this Board considers creation of zones to be in the best interest of CSA No. 7,
Boulder Creek.
NOW, THEREFORE, BE IT RESOLVED AND ORDERED by the Board of
Supervisors of the County of Santa Cruz that said Board does hereby so declare
and determine that CSA No. 7, Boulder Creek zones 1 and 2 are hereby
established.
BE IT FURTHER RESOLVED AND ORDERED that the geographic
boundaries of each zone CSA No. 7, Boulder Creek Zone 1 and Zone 2 are
reflected and shown on Exhibit 1.
PASSED AND ADOPTED by the Board of Supervisors of the County of
Santa Cruz, State of California, this day of , by the following
vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
COB Rev. 8-1-22
1
Resolution
___________________________
Chair of the Board of Supervisors
ATTEST: ___________________________
Clerk of the Board
Approved as to Form:
___________________________
Office of the County Counsel
3/28/2024 (AMS 15862)
Attachment: Exhibit 1
COB Rev. 8-1-22
2
Resolution _________
COB Rev. 8-1-22
3
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APPENDIX F:
COUNTY SERVICE AREA 10
(FORMATION RESOLUTION)
APPENDIX G:
COUNTY SERVICE AREA 20
(FORMATION RESOLUTION)
APPENDIX H:
DAVENPORT COUNTY
SANITATION DISTRICT
(FORMATION RESOLUTION)
APPENDIX I:
FREEDOM COUNTY
SANITATION DISTRICT
(FORMATION RESOLUTION)
APPENDIX J:
SALSIPUEDES
SANITARY DISTRICT
(FORMATION RESOLUTION)
APPENDIX K:
SANTA CRUZ COUNTY
SANITATION DISTRICT
(FORMATION RESOLUTION)