Csa2 Sugarloaf MSR SOI 4 6 2017

COUNTY SERVICE AREA # 2 SUGARLOAF Municipal Service Review & Sphere of Influence Update Adopted by Resolution 2017-02 April 6, 2017 Draft Hearing - April 6, 2017 Final Adoption - April 6, 2017 County Service Area 1 MSR SOI Update #2 Sugarloaf April 2017 SHASTA LOCAL AGENCY FORMATION COMMISSION Commissioners Les Baugh, County Member - District 5 Supervisor David Kehoe, County Member - District 1 Supervisor Larry Farr, City Member - City of Shasta Lake Stan Neutze, City Member - City of Anderson Brenda Haynes, Special District Member - Anderson Cottonwood Irrigation District Irwin Fust, Special District Member - Clear Creek Community Services District Dick Fyten, Public Member Alternate Members: Mary Rickert, County Member - District 3 Supervisor Francie Sullivan, City Member- City of Redding Patricia A. Clark, Special District Member – Anderson Fire Protection District Bob Richardson, Public Member Staff: George Williamson, AICP, Executive Officer Colette Metz, Analyst Kathy Bull, Office Manager Sarah West, Service Specialist Jason Barnes, GIS Analyst Leslie Marshall, Administrator Julie Thomas, Services Assistant James M. Underwood, Legal Counsel Acknowledgements: LAFCO staff would like to thank the contributors to this Municipal Service Review and Sphere of Influence Update. Valuable assistance in completing this report was provided by: Shasta County Department of Public Works. This report was made possible with their assistance. County Service Area 2 MSR SOI Update #2 Sugarloaf April 2017 TABLE OF CONTENTS INTRODUCTION ..................................................................................................................... 4 CSA OVERVIEW ............................................................................................................................................................. 4 PRINCIPAL ACT .............................................................................................................................................................. 4 SERVICE REVIEW DETERMINATIONS ................................................................................................................................... 4 SPHERE OF INFLUENCE DETERMINATIONS ........................................................................................................................... 5 REVIEW METHODS ......................................................................................................................................................... 5 CALIFORNIA ENVIRONMENTAL QUALITY ACT ....................................................................................................................... 6 COUNTY SERVICE AREA # 2 - SUGARLOAF .............................................................................. 6 DISTRICT OVERVIEW ....................................................................................................................................................... 6 Boundary and Sphere of Influence ....................................................................................................................... 7 Formation ............................................................................................................................................................. 7 Governance Structure .......................................................................................................................................... 7 Management and Staffing ................................................................................................................................... 9 Other Service Providers ........................................................................................................................................ 9 PRESENT AND PLANNED LAND USES .................................................................................................................................. 9 Existing Land Uses ................................................................................................................................................ 9 General Plan, Zoning, and Policies ....................................................................................................................... 9 Future Development Potential ........................................................................................................................... 10 POPULATION AND GROWTH ........................................................................................................................................... 10 DISADVANTAGED UNINCORPORATED COMMUNITIES .......................................................................................................... 10 DISTRICT SERVICE AND INFRASTRUCTURE .......................................................................................................................... 11 Water Service Overview ..................................................................................................................................... 11 Water Source ...................................................................................................................................................... 11 Water Treatment ............................................................................................................................................... 12 Water Storage .................................................................................................................................................... 12 Water Distribution ............................................................................................................................................. 12 System Monitoring ............................................................................................................................................. 13 Infrastructure Needs and Deficiencies................................................................................................................ 14 FINANCIAL INFORMATION .............................................................................................................................................. 15 Service Rates ...................................................................................................................................................... 16 Financing Constraints and Opportunities ........................................................................................................... 17 Cost Avoidance Opportunities ............................................................................................................................ 17 ACCOUNTABILITY AND GOVERNANCE ............................................................................................................................... 17 GOVERNANCE STRUCTURE OPTIONS ................................................................................................................................ 17 MUNICIPAL SERVICE REVIEW DETERMINATIONS .................................................................. 18 SPHERE OF INFLUENCE DETERMINATIONS ........................................................................... 19 List of Tables TABLE 1: CSA #2 SUGARLOAF AGENCY PROFILE ............................................................................. 6 TABLE 2: CSA #2 – SUGARLOAF COMMUNITY ADVISORY BOARD .................................................. 7 TABLE 3: SOURCE DATA ................................................................................................................ 12 TABLE 4: STORAGE DATA .............................................................................................................. 12 TABLE 5: WATER MAINS................................................................................................................ 12 TABLE 6: PRESSURE ZONES ........................................................................................................... 13 TABLE 7. CSA #2 - SUGARLOAF REVENUES & EXPENDITURES ...................................................... 15 TABLE 8. RESIDENTIAL IN-SERVICE AREA RATE SCHEDULE - EFFECTIVE JANUARY 1 2017: .... 16 TABLE 9. SHASTA COUNTY WATER METER CONNECTION FEES AND ROAD CROSSING COSTS ... 16 LIST OF FIGURES FIGURE 1. COUNTY SERVICE AREA #2 SUGARLOAF ......................................................................... 8 County Service Area 3 MSR SOI Update #2 Sugarloaf April 2017 INTRODUCTION This Municipal Service Review (MSR) and Sphere of Influence (SOI) Update provides information about the services and boundaries of County Service Area #2 - Sugarloaf (herein referred to as CSA #2). The report is for use by the Shasta Local Agency Formation Commission (LAFCO) in conducting a statutorily required review and update process. The Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (CKH Act) requires that the Commission conduct periodic reviews and updates of Spheres of Influence of all cities and special districts in Shasta County (Government Code § 56425). State law also requires that, prior to SOI adoption, LAFCO must conduct a review of the municipal services provided by that local agency (Government Code §56430). This report provides LAFCO with a tool to study current and future public service conditions comprehensively and to evaluate organizational options for accommodating growth, preventing urban sprawl, and ensuring that critical services are provided efficiently. CSA Overview County Service Areas are dependent special districts under County Service Area law (Government Code § 25210-25217.4). They provide, water, sewer and other services to unincorporated areas. In Shasta County, they are governed by the Board of Supervisors. The Shasta County Public Works Department provides staff support and administers District operations. Principal Act The principal act governing CSAs is the County Service Area law (Government Code § 25210- 25217.4) which authorizes CSAs to provide up to 26 types of governmental services within its boundaries. CSA #2 is authorized to provide water services. All other remaining services, facilities, functions or powers enumerated in the District’s principal act but not identified in the formation resolution are “latent,” meaning that they are authorized by the principal act under which the District is formed, but are not being exercised. Activation of these latent powers and services requires LAFCO authorization per Government Code § 25213.5. Service Review Determinations Government Code § 56430 requires LAFCO to conduct a review of municipal services provided in the county by region, sub-region or other designated geographic area, as appropriate, for the service or services to be reviewed, and prepare a written statement of determinations with respect to each of the following topics: 1. Growth and population projections for the affected area; 2. The location and characteristics of any disadvantaged unincorporated communities within or contiguous to the sphere of influence; 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); 4. Financial ability of agencies to provide services; County Service Area 4 MSR SOI Update #2 Sugarloaf April 2017 5. Status of, and opportunities for, shared facilities; 6. Accountability for community service needs, including governmental structure and operational efficiencies; and 7. Any other matter affecting or related to effective or efficient service delivery, as required by Commission policy. State Guidelines and Commission policies encourage stakeholder cooperation in the municipal service review process. It also provides a basis to evaluate, and make changes to Spheres of Influence, if appropriate. Sphere of Influence Determinations A SOI is a LAFCO-approved plan that designates an agency’s probable physical boundary and service area. Spheres are planning tools used to provide guidance for individual boundary change proposals and are intended to encourage efficient provision of organized community services, discourage urban sprawl and premature conversion of agricultural and open space lands, and prevent overlapping jurisdictions and duplication of services. LAFCO is required to establish SOIs for all local agencies and enact policies to promote the logical and orderly development of areas within the SOIs. Furthermore, LAFCO must update those SOIs every five years. For a SOI update, LAFCO is required to conduct a MSR and adopt related determinations. It must also make the following SOI determinations: 1. The present and planned land uses in the area, including agricultural and open-space lands; 2. The present and probable need for public facilities and services in the area; 3. The present capacity of public facilities and adequacy of public services that the agency provides or is authorized to provide; 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; and 5. The present and probable need for public facilities and services related to sewers, municipal or industrial water, or structural fire protection of any disadvantaged unincorporated communities within the existing sphere of influence (effective July 1, 2012). Review Methods The following information was considered in the development of this service review: o Agency-specific data: responses to LAFCO Requests for Information from Shasta County Public Works Department; o Land Use and Shasta County General Plan and Zoning data: Shasta County Planning Division and GIS webpage; o Demographic data: U.S. Census Bureau; Department of Finance; CA Water Resources Board; o Finances: budgets, rates and fees; and o Other Reports: State Water Resources Control Board, Division of Drinking Water sanitary survey. County Service Area 5 MSR SOI Update #2 Sugarloaf April 2017 Information gathered was analyzed and applied to make the required determinations. All information gathered for this report is filed by LAFCO for future reference. California Environmental Quality Act The California Environmental Quality Act (CEQA) is contained in Public Resources Code § 21000 et seq. Public agencies are required to evaluate the potential environmental effects of their actions. MSRs are statutorily exempt from CEQA pursuant to § 15262 (feasibility or planning studies) and categorically exempt pursuant to CEQA Guidelines § 15306 (information collection). CEQA requirements are applicable to SOI Updates. The CEQA lead agency for SOI Updates is most often LAFCO, unless an agency has initiated an SOI expansion or update. COUNTY SERVICE AREA # 2 - SUGARLOAF Table 1: CSA #2 Sugarloaf Agency Profile Formation Agency Name County Service Area #2 - Sugarloaf Formation Date August 11, 1976 Principal Act California Government Code §25210-25217.4 Contact Main Contact Patrick J. Minturn, Shasta County Public Works Director E-mail pminturn@co.shasta.ca.us Website www.co.shasta.ca.us/index/pw_index.aspx District Office Shasta County Department of Public Works Mailing Address 1855 Placer Street, Redding, CA 96001 Phone (530) 225-5661 Governance Governing Body Board of Directors (County Board of Supervisors) Board Meetings Tuesdays at 9:00 am, Board Chambers, 1450 Court St, Redding Advisory Body Sugarloaf Community Advisory Board Staffing County Public Works Department Services Services Provided Domestic Water Services Areas Served Unincorporated community of Sugarloaf District Overview County Service Area (CSA) #2 is organized as a dependent special district under County Service Area law (Government Code Section 25210-25217.4). CSA #2 provides domestic water services to the unincorporated area of Sugarloaf located along the Upper Sacramento River where it enters Lake Shasta near Salt Creek. Sugarloaf is a resort area offering vacation cabins, houseboats, marina businesses and other water recreational activities, as well as permanent homes for year-round residents. The CSA serves a small subdivision and is the backup water County Service Area 6 MSR SOI Update #2 Sugarloaf April 2017 supply for Sugarloaf Rental Cottages near the community of Lakehead, which makes up a population of about 160 with approximately 61 service connections. A municipal service review for the CSA was previously conducted in 2014. This document will update the previous MSR and build upon information provided therein. Boundary and Sphere of Influence The current service area of CSA #2 is approximately 57.3 acres with an additional 33.2 acres in the 2014 SOI. The current boundary and proposed SOI are shown on Figure 1. The district boundary includes the majority of the Sugarloaf subdivision area along Lakeshore Drive. Several parcels were removed from the original district formation proceedings creating an irregular shaped boundary. Currently, CSA #2 does not provide water services outside of the District’s boundary. Requests for water services have been received from residential parcels adjacent to the District, which was originally established to be coterminous with the District’s boundary. In 2014, the Commission approved an expanded sphere that included the adjacent rural residential and commercial-recreational areas within Sugarloaf. That SOI is proposed to be reduced as part of this update due to capacity limitations. Formation CSA #2 was established in 1976 to provide water services to the Sugarloaf subdivision. The formation of CSA #2 was sought during a time of drought in the 1970s. In December 1975, a petition representing 58% of Sugarloaf area residents was submitted requesting district formation. Subsequently, Shasta LAFCO approved the CSA #2 formation in 1976 contingent on the completion of a successful special election. Governance Structure CSA #2 is a dependent special district governed by the Shasta County Board of Supervisors. The Shasta County Public Works Department provides staff support and administers the operation of the District. In addition, a Community Advisory Board (CAB) consisting of seven (7) members serve as a liaison between district residents and the County. The CAB was established by the County in 1984 pursuant to Resolution No. 84-6. The CAB members are appointed by the County Board of Supervisors and serve two-year terms. Each year property owners are invited to nominate CAB candidates for vacant CAB seats. Elections are held if willing candidates exceed the number of vacant seats. The CAB provides a vehicle for more local participation and accountability. Current Sugarloaf CAB members are identified in Table 2. Table 2: CSA #2 – Sugarloaf Community Advisory Board Board Members Beverly Steele Carmen Lee Mardi Kisling David Lee Tom Kisling Les Monthei Diane Monthei County Service Area 7 MSR SOI Update #2 Sugarloaf April 2017 1 County Service Area 8 MSR SOI Update #2 Sugarloaf April 2017 Management and Staffing The County Public Works Department provides administrative support, staffing, and operations for 11 CSAs, including the Sugarloaf water system. The department has one operation supervisor, four licensed water treatment plant operators, and five part-time non-licensed employees. The Department is responsible for maintaining, upgrading or replacing equipment. They also manage budgets, suggest rates for services, and assure compliance with all laws relating to quality, health and safety. The Department manages CSA funds for capital improvement projects, bond assessments, and debt service, and administers customer billings. Other Service Providers Fire Protection Fire protection and emergency response services are provided by CSA #1 - Shasta County Fire Department (SCFD), which provides fire protection to all areas of the county outside existing fire protections districts and cities providing fire protection. The SCFD contracts with CAL FIRE to provide all department administration and operations functions. In addition, the SCFD supports 18 volunteer fire companies by providing oversight, administrative support, training, maintenance, funding, and dispatching. The closest fire station to CSA #2 is Lakehead to north, but it is no longer in operation. The Mountain Gate fire station provides fire protection to the community of Sugarloaf. There are 16 fire hydrants within CSA #2, which are maintained as part of the water system. Nearby Water Systems There are two State Small Water Systems within a mile of Sugarloaf. Both draw from wells and have fewer customers than Sugarloaf. Skyline Mutual Water Company’s water system serves seven parcels, and Sugarloaf Rental Cottages serves a resort area with 16 rental cabins. CSA #2 is the backup water supply for Sugarloaf Rental Cottages near the community of Lakehead. Present and Planned Land Uses Existing Land Uses CSA #2 primarily consists of rural residential and recreation oriented commercial uses. The District’s most prominent feature is the Sugarloaf marina and public boat ramp. Land outside and adjacent to CSA #2 is primarily unimproved resource land associated with the Shasta Unit of the Whiskeytown-Shasta-Trinity National Recreation Area. General Plan, Zoning, and Policies CSA #2 is located within the county unincorporated area and is therefore subject to the Shasta County General Plan and Zoning Regulations. The Shasta County General Plan and Zoning Code designates most of the territory within the District boundaries for Rural Residential (R-R NRA-S) and Commercial Recreation (C-R NRA-S), each with a National Recreation Area, Shasta Unit (NRA- S) combining zone. The Rural Residential (R-R) district is consistent with the Rural Residential “A” (RA) General Plan Land Use Designation which “provides living environments receiving no, or only some urban services, usually within or near a Rural Community Center”. The maximum residential density for (RA) is 1 dwelling unit per 2 acres. The Commercial Recreational (C-R) District “provides opportunities for the development of privately owned land for commercial recreation activities”1. This district is consistent with all general plan designations, if the proposed use blends harmoniously with the natural features of the surrounding area. County Service Area 9 MSR SOI Update #2 Sugarloaf April 2017 1Shasta County Municipal Code: www.municode.com/library/ca/shasta_county/codes/code_of_ordinances?nodeId=CD_ORD_TIT17ZO_TIT17ZO Future Development Potential The Shasta County Framework General Plan designate most lands within the district boundaries for rural residential development, which limits future development potential. Developed properties within the district boundaries use on-site septic systems. The availability of water and soil suitable for septic systems limits the density of future development within the district’s boundary. Population and Growth Sugarloaf is not a census-designated place so actual population statistics for the District are not available. The EPA’s State Drinking Water Branch reports a population of 160 currently served by the CSA #2 water system1. Looking at future population estimates, growth in the unincorporated areas of Shasta County appears to be negligible. A 2016 DOF report notes a recent decrease of 0.5 percent in the County’s unincorporated population between 2015 and 2016, indicating a potential for future population loss in unincorporated areas such as CSA #22. However, county population estimates still predict an increase of between zero and 0.5 percent through 20353. Using the 0.5 percent annual growth estimate and the 2010 population, the CSA #2 population could increase to 175 by the year 2035. Based on this analysis, it is unlikely that the District will have a significant increase in demand for water services during the MSR time frame. 1https://sdwis.waterboards.ca.gov/PDWW/JSP/WaterSystemDetail.jsp?tinwsys_is_number=7995&tinwsys_st_code= CA&wsnumber=CA4500006 2www.dof.ca.gov/Forecasting/Demographics/Estimates/documents/Price- Population_2016.pdf?zoom_highlight=shasta+population 3Caltrans: California Department of Transportation Shasta County Economic Forecast www.dot.ca.gov/hq/tpp/offices/eab/socio_economic_files/2013/Shasta.pdf Disadvantaged Unincorporated Communities LAFCO is required to evaluate water service, sewer service, and structural fire protection within disadvantaged unincorporated communities as part of this service review, including the location and characteristics of any such communities. A disadvantaged unincorporated community (DUC) is defined as any area with 12 or more registered voters where the annual median household income (MHI) is less than 80 percent of the statewide annual median household income (pursuant to Government Code § 56033.5 and Water Code § 79505.5). Within a DUC, three basic services are evaluated: water, sewage, and fire protection. CSA #2 Sugarloaf provides domestic water services only, and is therefore responsible for assuring that this service is adequately provided to the community. Community wastewater services are not provided in this area; the community relies upon individual private septic tanks for sewage disposal. As mentioned above, the CSA #1 provides countywide fire protection through the Shasta County Fire Department. CSA #2 Sugarloaf is in Shasta County Community Tract, 06089012500 which meets the definition of a Disadvantaged Community Tract. The Tract has a MHI of $41,917, which is 69 percent of the state average MHI,5, thereby qualifying the area as disadvantaged. Should territory in the surrounding area be proposed for annexation in the future, disadvantaged communities in the area should be considered. 5 Census Quickfacts: https://www.census.gov/quickfacts/table/INC110215/06,2412150,00 County Service Area 10 MSR SOI Update #2 Sugarloaf April 2017 District Service and Infrastructure Water Service Overview CSA #2 provides water collection, treatment and distribution services for the Sugarloaf subdivision. The CSA is also the backup water supply for the Sugarloaf Rental Cottages near the community of Lakehead. The water system serves a population of about 160 with 61 service connections6. It is estimated that approximately 70% of the connections are in use year-round with full time population of about 87. The average household size is 2 persons. Subdivision Water mostly groundwater from well located in the northern portion of the subdivision, but the system supplements with treated surface water diverted from an unnamed creek on east side of Sugarloaf Mountain, December-June. Surface water treated with a coagulant and chlorine disinfectant prior to filtration through four single media sand pressure filters. Groundwater also treated with chlorine. Finished water is stored in a 42,500 gallon bolted steel storage tank6. CSA #2 holds a state water permit for drinking water treatment and delivery for municipal purposes (public water system No. 4500006). The water system and treatment plant originally permitted in June 1984 and are reviewed annually by Shasta County Public Health Department. Based on the Department of Water Resources Groundwater Basin Maps (Bulletin 118), CSA #2 is not located in a formally designated Groundwater Basin. However, it does directly utilize groundwater as a water source. CSA #2 is in the Sacramento Headwaters Watershed. Water Source The water system is supplied by a groundwater well that is supplemented with treated surface water from an unnamed creek from December through June. The well is the main water source and is located approximately 150 yards at the end of Oak Knoll Lane. The stream source is located at the end of Oak Knoll Drive near Obsidian Lane above the treatment plant. A concrete dam was constructed in the unnamed creek to transmit surface water to the treatment plant. The water behind the dam collects in a rock depression and is covered with a metal roof with a locking door. The water gallery has a screened overflow and a bottom flush valve to clean debris and sediment. A 3-inch diameter PVC pipe delivers water to the treatment plant. The pipe is not buried and runs along the surface near the creek.6 Per the sanitary survey inspection report, CSA #2 received a notice from State Division of Water Rights, in April 2015, to curtail surface water diversion from the unnamed creek in response to the ongoing drought. However, based on the well production data, the groundwater source alone does not appear capable of providing water up to the maximum daily demand. Therefore, during months when surface water cannot be diverted and there is not a secondary water source, the source capacity does not meet the California Waterworks Standards, which require public water systems to have source capacity to meet the systems maximum daily demand. The maximum daily demand in 2014 was 76,000 gallons per day. If the ground water well has a pumping capacity of 45 gpm, then only 64,800 gallons per day can be produced. During the curtailment period, the groundwater well is the only water supply source. When this supply is depleted in drought conditions, water can be hauled in from off-site, although it is often impractical.6 County Service Area 11 MSR SOI Update #2 Sugarloaf April 2017 Table 3: Source Data Source Status Capacity (gpm) Surface Water Unnamed Creek Active (Dec – Jun) 17.4 gpm (25,056 gpd) Spring Active 45 gpm (64,800 gpd) Total 62 gpm (89,290 gpd) Water Treatment Water is sent to a 1,000-gallon storage tank prior to treatment. If the treatment plant is offline, the water bypasses the treatment system and is piped back into the creek, through an outlet in the tank. If treatment is provided, a chlorine disinfectant and a polymer coagulant are injected in-line prior to filtration. Four single media sand filters operate in parallel and filtered water is pumped to a 42,500-gallon storage tank. Groundwater from the well is chlorinated at the well site and pumped to the 42,500-gallon storage tank.6 Water Storage As noted above, finished water after treatment is stored in a 42,500-gallon bolted steel storage tank located near the water treatment plant. Table 4: Storage Data Name Type Capacity Comments surface Steel 1,000 Raw surface water storage tank. Creek Water diverted to water gallons tank. Float switch shuts plant off when water flows low. tank Overflow delivers water back to creek when plant is off. Main Bolted 42,500 Finished water storage tank. The tank is rusted inside and tank Steel gallons out. There are pencil size holes in the roof of the tank. Water Distribution The distribution system consists of a network of two, four, and eight-inch diameter water lines. One leak was reported in 2014, due to corrosion, and was subsequently repaired6. Table 5: Water Mains Material Amount Size Steel 1,200 ft. 8-inch diameter Steel 350 ft. 4-inch diameter Steel 400 ft. 2-inch diameter PVC 5,100 ft. 4-inch diameter The distribution system consists of three pressure zones. Booster stations supply water to the storage tank and to the distribution system. County Service Area 12 MSR SOI Update #2 Sugarloaf April 2017 Table 6: Pressure Zones Pressure Zone Name Pressure Range Connections Treatment plant to downhill users Gravity flow 40 psi to 100+ psi ~49 Treatment plant to uphill lots on 70 psi to 82 psi Up to 5 lots Obsidian Lane Shale Drive 60 psi to 120 psi 5 System Monitoring CSA #2 is required to routinely monitor for drinking water contaminants. This includes monitoring for total trihalomethanes (TIHMs) and Haloacetic acids (HAA5s) quarterly at locations in the distribution system. TIHMs and HAA5s are chlorine disinfection byproducts. Discrete samples in the distribution system have shown concentrations of HAA5 above the maximum contaminant level (MCL) on four occasions.6 The CSA conducts routine monitoring for these contaminants at four monitoring locations in the distribution system. However, in 2014 and 2015, the CSA did not collect a complete series of quarterly samples at approved locations and was required to notify the public of the violation. The CSA is continuing to work with the State Division of Drinking Water to develop an approved Disinfection Byproduct Monitoring Plan that specifies two locations in the distribution system that will be monitored each quarter. The monitoring plan goal is to obtain consecutive samples at the Lake and Shore Drive locations, over the course of a year to determine compliance. A current monitoring program is in place. A Bacteriological Sample Siting Plan (BSSP) was submitted to the State Division of Drinking Water in February 2015, a more recent BSSP has also been submitted. The BSSP describes that raw water sampling is to occur quarterly at the well and surface water source. In addition, one routine total coliform sample is to be collected each month from one of four locations in the distribution system. The Division of Drinking Water has requested that raw water from each water source be monitored monthly for total coliform and E.coli with quantified results.6 Iron and Manganese in raw groundwater exceed the secondary MCL. Constituents that exceed the secondary MCL shall be monitored quarterly, and compliance shall be determined by a running annual average of the four quarterly samples.6 The State Division of Drinking Water has provided the District with an updated chemical monitoring schedule, and monitoring is up to date. The following chemical monitoring was due in May 2015, and has been completed:  Surface Water – nitrate  Groundwater – chloride, copper, foaming agents (MBAS), iron, manganese, sodium, specific conductance, sulfate, total dissolved solids, zinc, asbestos, fluoride, and radium 228  Distribution System – Lead and Copper by September 2015.6 A Consumer Confidence Report (CCR) is sent annually to customers. The last CCR was prepared in 2015 and posted on the Shasta County website. County Service Area 13 MSR SOI Update #2 Sugarloaf April 2017 Infrastructure Needs and Deficiencies On May 19, 2015, the State Water Resources Control Board, Division of Drinking Water conducted a sanitary survey of public water system No. 4500006, Shasta County Service Area No. 2 - Sugarloaf (CSA). The inspection noted compliance issues with surface water treatment requirements, source water and storage capacity, monitoring of disinfection byproducts, and well and water storage conditions. The following sections provide a description of the system and identify compliance issues as reported by the Division of Drinking Water. According to the State Division of Drinking Water, the groundwater well is vulnerable to contamination and is not secure. The well is located at the end of a drainage ditch along the side of a driveway. The well and its apparatuses, including the chlorine, are not sheltered.6 Per the State Division of Drinking Water, the storage tank is corroding with holes in the tank roof, making the finished water storage vulnerable to contamination. Additionally, the storage capacity is less than maximum daily demand (MDD) of 76,000 gallons in 2014. California Code of Regulations § 64554 requires that “systems with less than 1,000 service connections shall have storage capacity equal to or greater than MDD, unless the system can demonstrate that it has an additional source of supply or has an emergency source connection that can meet the MDD requirements.” Based on 2014 usage information, at least 34,000 gallons of additional storage capacity is needed to comply with the California Water Works Standards. The State Division of Drinking Water (SDDW) considers the District’s surface water treatment system an unapproved alternative filtration technology, referred to as "in-line filtration". Under specific operating conditions, this technology can meet the performance criteria to be considered equivalent to direct filtration, which is an approved filtration technology. However, this system does not always meet the SDDW established performance criteria. On July 17, 2015, the State Division of Drinking Water issued CSA #2 Compliance Order No. 01- 02-15(R)-005 pursuant to California Health and Safety Code § 116655 and California Code of Regulations, Title 22, § 64652. Specifically, the Compliance Order addresses system filtration treatment for 99% Cryptosporidium removal through filtration.7 The Compliance Order lists specific compliance actions, and directs the District to notify customers of violation and submit an interim operations plan for the water treatment plant by September 1, 2015. The CSA has submitted an interim plan and has returned to compliance. The Division of Drinking Water requires that the system treat to a higher effluent turbidity standard of less than 0.1 NTU, to minimize the risk of pathogen exposure and monitoring of effluent turbidity from the individual filters. Pressure filter loading rates averages approximately 1.7 gpm/ft2 but have exceeded the allowable rate of 2.0 gpm/ft2 for single media sand filters on a number of occasions. In addition, the CSA needs to report when backwash cycles occur. The 42,500-gallon bolted steel water storage tank shows signs of interior and exterior oxidation, making water storage vulnerable to contamination. The groundwater supply well, has been cited as needing better isolation from surface water penetration. Following wet weather events, sediment and debris have to be removed from the well area to prevent inundation and possibly contamination. The well is not covered, and well components are showing signs of corrosion due to exposure. The chlorine tank is located behind a secured gate and the State reports express County Service Area 14 MSR SOI Update #2 Sugarloaf April 2017 concern that the chlorine tank could be inadvertently accessed and a release could occur. The well site requires some improvements that may include extending the well casing and/or construction of a well house.6 CSA #2 does not currently have an infrastructure expansion master plan. An engineering firm has been engaged to develop a Preliminary Engineer’s Report to identify needed treatment, storage and distribution upgrades. It is expected that the County Public Works Department will use this information to pursuing grant funding for recommended upgrades. Shasta County Water Agency Board of Directors Resolution No. 2017-01 authorizes the Shasta County Water Agency Chief Engineer to seek and execute state revolving fund monies to finance infrastructure upgrades in CSA#2. 6 State Water Resources Control Board, Division of Drinking Water . July 10, 2015. Sanitary Survey Inspection Report for Water System No. 4500006 7 State Water Resources Control Board, Division of Drinking Water (SWRCBb). July 17, 2015. Compliance Order No. 01-02-15(R)-005 for California Code of Regulations, Title 22, Section 64652 – Water System No. 4500006 Violations. Financial Information CSA #2 is principally funded by service charges and does not receive property taxes. Each year the County adopts a budget for CSA #2. Table 7 provides actual budgets for Fiscal Years 2014-15 and 2015-16, as well as the approved FY 2016-17 budget. Resolution 2017-01, authorizes the Shasta County Water Agency Chief Engineer to sign and file for a Financial Assistance Application seeking State Revolving Fund monies that will finance the planning and/or the design of the CSA #2 Water Improvement project. The anticipated State Revolving loan funds will be used for system upgrades and will not address the budget deficit. Table 7. CSA #2 - Sugarloaf Revenues & Expenditures Revenue Adopted 16-17 Actual 2015-16 Actual 2014-15 420000 – Interest $35 $22 $25 693020 – Water Service Collections $30,140 $35,828 $36,000 806346 – TRAN IN CSA #2 SGRLF CAP IMP $4,800 $4,800 $5,200 Total Revenue $34,975 $40,650 $41,225 Expenses 33103 – INSUR XP Miscellaneous $108 $96 $98 33500 – Maintenance Of Equipment $1,776 $3,238 $3,000 33700 – Maintenance Of Structures $0 $0 $2,000 33791 – Facilities Management Charges $6 $0 $0 34100 – Memberships $153 $163 $163 34591 – Charges Oc Postage Svs $451 $445 $535 34800 – Prof & Special Services $2700 $721 $500 34826 – Prof Lab SVS $3,479 $4,221 $3,600 34829 – PROF Maintenance SVS $22,529 $25,306 $25,227 34900 – Publications and Legal Notices $360 $7 $0 35100 – Rents & Leases Of Equipment $0 $121 $200 35500 – Minor Equipment $485 $0 $0 County Service Area 15 MSR SOI Update #2 Sugarloaf April 2017 35700 – Special Departmental Expense $510 $1,510 $1,500 36100 – Utilities $3,616 $4,682 $6,000 50001 – Central Service Cost A-87 $3,018 $2,374 $2,996 50900 – Depreciation Expense $4,658 $4,658 $5,140 Total Expenses $38,191 $42,884 $45,819 Net Total (Deficit) -$3,216 -$2,234 -$4,594 Source: Shasta County As discussed below, basic operating revenue comes from bi-monthly (once every two months) water service charges. The current water fees and rates were established by District Ordinance No. 701. Occasionally, additional revenue is generated when specific services are requested, such as new meter installations. This work is charged at a fixed rate. Any bimonthly service charge change must originate with an engineering report that analyzes existing revenue and projected future costs. Based on that analysis, a new rate structure can be recommended for Board approval. A public hearing is held prior to authorizing the rate change. The degree to which there is rate change opposition constitutes the constraint to generating additional revenues. Service Rates The CSA #2 rates for water services are as follows: Table 8. Residential In-Service Area Rate Schedule - Effective January 1 2017: Charge Type Amount Applies to: Basic Charge $75.00 Bi-monthly First 1,300 cf consumed (0-1,300 cf) Additional Use Charge 1 $8.00/ 100cf consumption of 1300-2,300 cf Additional Use Charge 2 $12.00/ 100cf consumption of > 2,300 cf Installation: Meter and main line extension installations shall be at the sole expense of the person or entity applying. (1) When main line extensions are not required, CSA personnel will install the meter based on the following fees to be paid prior to installation: Table 9. Shasta County Water Meter Connection Fees and Road Crossing Costs 3/4” Meter 1” Meter 1-1/2 Meter 2” Meter Road Crossing $ 750.00 $ 1,000.00 $ 1,250.00 $1,500.00 $2,500.00 Deposit + actual costs (2) When main line extensions are required, meter installation and service extension shall be constructed at the sole expense of the person or entity applying for the extension, and shall meet or exceed County minimum standards and requirements. A minimum improvement plan-checking and construction inspection deposit of $500 is required. Once the actual plan-checking and construction inspection costs are determined, a fee to cover those costs shall be imposed and the deposit shall be applied to the fee. Stand-by Fees and Vacation Fees: A bi-monthly stand-by fee of $25.00, paid by the parcel owner, is charged for each parcel in the service area where water service delivery is available but not County Service Area 16 MSR SOI Update #2 Sugarloaf April 2017 initiated; whether structures are present or not. Properties determined not to be suitable for residential or commercial use are exempt. Customers with a meter may be charged the applicable stand-by fee if the property is to receive regular water service for less than three consecutive months per year. Financing Constraints and Opportunities Currently, a Preliminary Engineer’s Report is being prepared to identify needed treatment, storage and distribution upgrades. It is expected that the County Public Works Department will use this information to pursuing grant funding for recommended upgrades. Cost Avoidance Opportunities Regular system monitoring, infrastructure condition inspections, and a capital improvement plan for scheduled replacement and upgrades are effective cost avoidance measures. The State Water Resources Control Board, Division of Drinking Water May 2015 sanitary survey identified water treatment, source water adequacy and storage capacity, disinfection byproducts monitoring, and well and water storage conditions as needing attention. Accountability and Governance Budgets are approved annually by the BOS which then establishes the scope of work and improvements that can be performed. The BOS, as the district board of directors, authorizes and approves any contracts used to construct improvements or perform maintenance work, or to conduct studies, designs, or engineered changes to the water system. The Board communicates directly with the Director of Public Works and/or department staff during weekly Board meetings or through written communications. The BOS meets weekly, but only conducts business related to CSA #2 as needed. Communication with the public takes place at the CAB meetings, which occur quarterly and provide time for public input on topics related to the CSA. The CAB exists to represent all property owners within the CSA and to enhance local input regarding CSA matters. Governance Structure Options No governance structure options are identified, due to small system size and distance from other systems offering similar service. County Service Area 17 MSR SOI Update #2 Sugarloaf April 2017 MUNICIPAL SERVICE REVIEW DETERMINATIONS This section addresses determinations as specified in the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (California Government Code § 56430). As part of the municipal service review process, LAFCO makes the following written determinations. Growth and population projections for the affected area CSA #2 was created to provide municipal water service to the Sugarloaf community, adjacent to Shasta Lake. There have been SOI amendments that could potentially increase its service area. However, population growth and population projections for the area served is expected to be limited or none as the area is built-out. The estimated CSA # 2residential population is approximately 90 persons. The location and characteristics of any disadvantaged unincorporated communities within or contiguous to the sphere of influence CSA#2 has been identified as being a DUC. There are no other DUCs in the vicinity that could be served by the CSA. 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 disadvantage unincorporated communities within or contiguous to the sphere of influence. As noted in the State Water Resources Agency report, there are system deficiencies, and these are being addressed by the County. LAFCO recommends that the CSA #2 continue efforts to prepare engineering reports and cost analysis to estimate needed infrastructure project costs and relay those costs to customers in the form of a fee increase in advance of the next MSR and SOI update cycle. At the present time, the CSAs has the capacity to serve the existing service areas. CSA #2 does not provide sewer, and fire protection services. These services are provided through other special districts in Shasta County or by private systems. Financial ability of agencies to provide services CSA #2 is an “enterprise” district with water service funding primarily from services fees and charges The District periodically reviews and updates fees to maintain a nexus between reasonable charges levied, and actual costs of services provided, which cannot exceed 1.5% of the median household income. The District seeks to be as efficient and innovative as possible in maximizing use of existing fiscal resources. The County is seeking State Revolving Loan Funds and grants to fund upgrades to the system. The District has a maintenance policy, and periodic replacement of outdated or deteriorating equipment should be scheduled in a Capital Improvement Program with a financing plan. County Service Area 18 MSR SOI Update #2 Sugarloaf April 2017 Status of, and opportunities for, shared facilities No opportunities for shared facilities have been identified. There is no known overlapping or duplication of services within the CSAs’ boundaries. Accountability for community service needs, including governmental structure and operational efficiencies Accountability for CSA residents in the Sugarloaf unincorporated area is provided by the citizen advisory board. The CSA demonstrated accountability and transparency by disclosing financial and service related information in response to LAFCO requests. Any other matter related to effective or efficient service delivery, as required by commission policy None beyond those noted above. SPHERE OF INFLUENCE DETERMINATIONS Shasta LAFCO makes the following written SOI determinations. The present and planned land uses in the area, including agricultural and open-space lands. Shasta County designates the area served as residential and rural residential, agricultural, and timber lands. This is primarily a rural residential area, with community development either clustered around the resort or along surrounding county roads. The present and probable need for public facilities and services in the area. The SOI includes additional residential parcels, mostly developed. Since these already have onsite water systems, there appears to be a minimal present or probable need for public facilities and services for this area. The present capacity of public facilities and adequacy of public services that the agency provides or is authorized to provide. The CSA was formed to provide water service only. District facilities provide for current service needs within the CSA boundary. There is a need to upgrade existing infrastructure to maintain that service for the future. There is also no expected change to the present capacity or adequacy of the public services currently provided by the CSA. Any proposed service extension would be due to conversion from on-site water services on developed parcels to the municipal system, which would be evaluated at time hookup is proposed. Capacity to serve the areas within the current SOI boundary would be dependent on infrastructure upgrades not currently planned. The SOI proposed in the prior MSR and SOI Update has been reduced, to be coterminous with the District boundary, except for one surrounded and developed parcel in the center of the District, due to these capacity limitations. County Service Area 19 MSR SOI Update #2 Sugarloaf April 2017 The existence of any social or economic communities of interest in the area if the commission determines that they are relevant to the agency. CSA #2, located on the westerly shore of Lake Shasta, north of the City of Shasta Lake, is a distinct and separate area. The Cities of Shasta Lake and Redding are the closest social or economic communities of interest, and provide both shopping and social services to CSA residents. 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, the present and probable need for those public facilities and services of any disadvantaged unincorporated communities within the existing sphere. The Sugarloaf area within the SOI is considered a DUC. There are no DUCs adjacent to the CSA that should be included in the SOI. County Service Area 20 MSR SOI Update #2 Sugarloaf April 2017