The local real estate landscape may drastically change if hefty fees are imposed on Malibu small businesses and institutions.
By Olivia Damavandi / Assistant Editor
The city announced this week that hundreds of residential property owners will have to shell out about $1,000 per month to help finance an estimated $52 million centralized wastewater treatment facility if a septic systems ban is approved. The Regional Water Quality Control Board will decide next month whether to ban such systems in the broader Civic Center area.
The price tag for commercial property owners will vary greatly depending on the size and use of their property, but the city anticipates it will be significantly higher than residential costs.
The hefty cost of the septic ban may drastically change Malibu’s real estate landscape as it would affect churches and schools that are already in a financial struggle.
“It’s devastating,” Peggy Thomas, Our Lady of Malibu parish business manager, said Tuesday of the possible $1,000 monthly payments. “There’s no way we’d have the money to pay for that.”
The regional water board’s staff recommends a plan to phase out the utilization of septic systems in most of the eastern portion of Malibu, due to its assessment that they are the major cause of pollution in the Malibu watershed. The plan, which the board will vote on at a meeting in downtown Los Angeles on Nov. 5, includes an end to all further permitting of septic systems in commercial sections of the city such as the Civic Center area and the stretch of Pacific Coast Highway from Serra Road to Sweetwater Canyon, as well as the residential areas of Malibu Colony, Malibu Road, Serra Retreat, Sweetwater Mesa and the Malibu Knolls.
Also, all current septic systems in those areas would have to be phased out within five years. The water board could issue fines of up to $10,000 per day or $100 per gallon of wastewater discharged to those who do not comply.
But in the midst of so many financial threats, most property owners are asking the same question: can the Regional Board actually impose such astronomical costs and fines?
City Manager Jim Thorsen did not rule out the possibility that the city could sue the water board. “Certainly that can be done, but we certainly won’t make any statement toward that until we find out what happens,” he said Tuesday in a telephone interview.
The $52 million estimate of a centralized wastewater system includes planning, engineering design, construction, construction management, administration and legal fees. It does not, however, include land purchase expenditures, which could drive the costs upward, the city stated in a press release.
Estimated operations and maintenance costs of the wastewater system would total approximately $1.6 million per year including power, chemicals, repair/replacement, insurance and staffing by certified operators. The monthly cost of the project would be approximately $420,000 ($5 million per year) assuming a capital cost of $52 million, annual costs of $1.6 million and a 20-year SRF loan at 2.7 percent.
Local businesses and private institutions are already struggling with upgrading existing septic systems. The possible ban and potential costs make it even harder.
“The city started a new ordinance last year where we had to get a permit to have our septic systems,” Thomas of OLM said. “So we had to have it inspected and pay a lot of money to get it up to speed and in perfect order so that we could have our permits. And then someone else comes along and tells us ‘We’re not going to let you use those septic systems anymore. You’re paying all this money to keep things going but that’s just for today.”
“It seems to me that there are probably a lot of systems that are working just fine and probably some that aren’t, and it seems like they [the water board] just did a blanket thing without considering everyone that’s involved,” Thomas continued. “The [OLM] school and the church shouldn’t even be commercial properties, they’re not money making. The only money we have is what people give us in the plate when we pass it out every week.”
Santa Monica-Malibu Unified School District and Los Angeles County will also incur the monthly fees, as Webster Elementary School and county-owned properties like Fire Station 88 and those that house the Malibu Library and Malibu Courthouse lie within the septic prohibition zone.
“We’ve talked to the county, not extensively, but they’re aware of the situation,” Thorsen said. “They’ve prepared a letter that went to the regional board. They have a lot of concerns.”
Malibu officials say there are five studies, including one that is partially city-funded, being conducted at this time that will prove the proposed ban will not improve water quality. The city wants the Nov. 5 hearing delayed until those studies can be finished, which will be in about six to nine months.
But the water board last month denied the city’s request to postpone the hearing. RWQCB Executive Officer Tracy Egoscue last month recommended the board deny the request because she said the RWQCB already has enough information to proceed with a vote.
If the Regional Board votes to enact the septic prohibition, it must be also be approved by the State Water Resources Control Board, and finalized by the State Office of Administrative Law.