County officials unveiled ambitious plans at Monday’s City Council meeting detailing how they intend to pay for the first phase of a proposed 20-year, $266 million plan to overhaul Malibu and unincorporated Topanga’s aging and decrepit water system, beginning in 2015.
Much of the system was built around 1960, and does not meet the county’s current fire protection water demands. Malibu City Council members said despite the huge price tag, the project was necessary.
“There’s no one that doesn’t think we need this desperately,” said Councilman Lou La Monte. “$266 million? We’ll probably spend that on bottled water in the next year.”
Starting with the good news, county officials announced that the first $57 million toward key pipeline projects would come out of accumulated reserve and bond money from Waterworks District 29, avoiding any additional hikes to ratepayers until 2022, they said.
“There are no new rate increases needed now for the next five to seven years,” said consulting engineer Rich Plecker, who worked with the county to help craft the plan. “There’s nothing new needed to be able to fund this.”
The water district announced last October plans to increase rates by 30 percent through 2016 for unrelated improvements.
Still, the $57 million guarantee appears to feature some creative accounting.
The county Public Works Department said part of the $57 million required to pay for Phase 1 will come through nearly $30 million it has accumulated in capital improvement charges, property tax revenues and cash reserves. The roughly $27 million remainder would have to come from what the county has labeled under the vague term “bond” money, said Plecker. If all goes according to plan, those funds would not be obtained until 2017—two years after the county expects to begin the overhaul.
“[Bond money] could be a bank loan, it could be a grant, it could be bonds themselves,” Plecker told the City Council. “But it’s a term we’re using to say we’re getting external funding in 2017.”
After the presentation, Maria Chong-Castillo, public works deputy for County Supervisor Zev Yaroslavsky, said nailing down a definitive source for the bond money will be among the next steps in the process but did not provide further details.
The system overhaul was solicited more than two years ago by the county Board of Supervisors to address a deficient water flow system in Malibu and Topanga.
Representatives from County Supervisor Zev Yaroslavsky’s office, Los Angeles County Public Works and Water Works District 29 presented details of the plan at Monday’s Malibu City Council meeting.
The entire 20-year project is projected to last through 2035. The first phase targets 37 “high priority” projects to reconfigure and rebuild the most deficient pipelines and water tanks throughout Malibu and Topanga, according to a list released Monday. The single priciest item is a $9.2 million emergency line construction at Encinal Canyon Road and Pacific Coast Highway. Other key capital projects range in price from $44,000 to $4.1 million.
To fully implement the long-range master plan, the county estimated it would likely take two years to conduct and win approval on an environmental impact report (EIR). The EIR would necessitate a public vetting period, approval from the stringent California Coastal Commission and the county Board of Supervisors, and a layered permitting process.
Once Phase 1 is finished, funding is likely to get much more complicated for the cash-strapped District 29. Ways to fund the remaining $209 million have yet to be determined, according to the county, but rate hikes and ballot measures are possible after 10 years have passed.
Plecker said the county could not rule out a possible 2.5 percent rate hike once 2022 comes around, along with obtaining $23 million more in bonds, possibly through a ballot measure.
Still, officials refrained from making assumptions on funding after the first phase ends, maintaining a vague tone about future funding methods.
“Now what happens in the future? That’s something to be decided in the future,” Plecker said.