Tuesday, November 8, 2011

OPPOSE - Point of Sale Mandate on Nov. 14 CC Agenda

Mayor Mary Ann Nihart
and Pacific City Council
170 Santa Maria Avenue
Pacifica, CA 94044

RE: Pacifica Point-of-Sale Inspections for Sewer Laterals

Dear Mayor Nihart and Council;

On Monday, November 14, city staff will present an ordinance for City Council’s consideration that will mandate the inspection and repair or replacement of damaged sewer laterals on any property that is A) sold in Pacifica before the sale is allowed to close; B) undergoing a remodel that costs more than $75,000; or, C) adding a bathroom or other significant plumbing fixture to a building.

This methodology is commonly referred to as a “point of sale” approach, and in all candor, it is inequitable; will not attain what the city is seeking to achieve in the treatment, disposal and control of wastewater and industrial waters in a timely manner; and, still leaves Pacifica open to further sanction/litigation until a full remediation of the system is completed.

The San Mateo County Association of REALTORS® (SAMCAR) is opposed to this discriminatory scheme and urges the Council to reject same. At a minimum, this issue needs to be deferred for 180 days to allow an opportunity to explore alternatives with the Council and staff. Why?

Point-of-sale mandates are inequitable. They apply only to those who sell a home or property. Point-of-sale mandates are an unfair addition to home sales transactions, as they place a city-wide problem on the shoulders of a small segment of the population: buyers and sellers.  An issue that impacts the entire community, such a sewer lateral inspections, should have a solution on a city-wide basis.  Ensuring the quality of the sewer lateral system throughout the city is an important health and safety issue… but such an immediate need will not be adequately addressed through point-of-sale. 

More efficient and effective methods should be employed. For example, a city-wide approach using flow meters to detect particular ‘hot point’ inflow and infiltration in areas with Orangeburg pipe, then adjusting the CIP to target those areas.

Point-of-sale mandates are inefficient. Commercial and multi-family residences sell at much lower turnover rate than typical single family dwelling.  As of the most recent annual figures (2010), the turnover rate throughout the county averaged 2% per year.  Meaning it could take approximately 50 years to address the sewer lateral issue IF the city waits until the point-of-sale to achieve the inspections/repairs.

Point-of-sale mandates are inconsistent. What about financing improvements for the 82 miles of public sewer mains? That’s up to the city, with the suggestion that the city consider increasing its wastewater fee rates for property owners in order to collect the needed revenue. Interesting as that is a city-wide approach.

Point-of-sale mandates can cause someone to lose a home they’re trying to purchase. Our concerns regarding point-of-sale mandates also touch upon the transaction itself.  In our current economic climate, there are a number of short sales and real estate-owned (REO) transactions that, for a number of reasons, require an expedited escrow process.  Adding an additional, costly step serves only to delay – or in some instances, void – the transaction for the home buyer and seller. 

Point-of-sale mandates are costly. The cost of sewer lateral repair or replacement averages $7,500 to $25,000. In an area such as Pacifica, any incremental costs might render a home effectively unaffordable, especially for first time home buyers.  On an individual case basis, replacing a lateral is expensive and the cost can escalate depending on the length of pipe and whether it goes beneath concrete or into the street. City staff has said it will negotiate with one or several contractors to get a reduced, bulk rate for the required projects. The city will also to provide grants to applicable property owners up to total disbursements of $650,000. 

Based on the high estimate for repair/replacement, that means a total of ONLY 25 houses will benefit from the grant program if 100% of the cost is reimbursable; 50 houses if the reimbursement is halved. According to MLS Listings, Inc., 230 home sales closed last year in Pacifica, so it would take the city 4+ years just to handle just what transpired in 2010.

Point-of-sale mandates are not covered by home owner’s insurance. Until recently, most home owner’s insurance policies would cover damage or repairs on the property specific, which is measured to the property line. However in most policies, sewer laterals are now specifically exempted from such coverage. (Also remember, the vast majority of policies also did not cover repairs from the property line to the street… yet that may be where the lateral breach is located. This cost for this municipal service would then wholly borne by the home owner as the responsibility for sewer laterals is being transferred to property owners – residential and business alike.

Finally, the Regional Water Quality Control Board (RWQCB) is demanding that the city have zero discharge or overflow problems in its sewer system by Jan. 1, 2019. Bottom line: You will not accomplish that using a point-of-sale mandate, so the RWQCB can place further sanctions on the city/sue you again.

Thank you for the opportunity to provide our input and we look forward to the Council’s continuance of this issue for further study.

Respectfully,
Paul Stewart
Government Affairs Director
San Mateo County Association of REALTORS®
850 Woodside Way / San Mateo, CA 94401
(650) 696-8209 / (650) 342-7509 (fax)

Submitted by Jim Wagner

18 comments:

Steve Sinai said...

And don't forget the energy upgrades the Climate Task Force wants to impose on you when you buy or sell a home. On a $600,000 sale, you could be forced to spend $4,500.

Capitalist said...

Commie Laws.

Lois Rogan said...

"Bottom line: You will not accomplish that using a point-of-sale mandate, so the RWQCB can place further sanctions on the city/sue you again."

This issue has been discussed for years and another REALTOR and I sat down with Councilman Vreeland many, many years ago to try and explain the impossibility of this point of sale working.

Those of you who plan on dying in your home in Pacifica will never have to deal with it.

realtors said...

Time to come out of the coccon and start coming to city council and tell them what a bad idea this is!

The Spin Doctor said...

Paul

You are totally correct on all points

And I agree, however this action really isn't much of a vote.

We are required to pass this as part of our consent decree when we had the large release of partially treated waste water some years ago. We are paying a$1.8 million fee of which $850 or 800,000 is part of a SEP which we will concentrate in one of the worst areas to get the laterals replaced.



Meanwhile the court and the regional water quality control board were nonnegotiable on a point of sale clause



Bottom line - at this point if we don't pass the ordinance we are in violation of the consent decree... We could then be asked to forfeit the SEP plus pay the total amount immediately



So sorry but we just can't do that



All of your facts are totally correct



I hope you understand and I am totally happy to talk with you more about this



My cell is 650-784-9141



Take care

Mary Ann

Lionel Emde said...

So here's some questions for our Mayor, and by the way, she is correct in that the consent decree requires exactly what the ordinance language proposes:

What is the possibility of financial help for homeowners who are required to replace laterals from the city?

The decree has a clause relieving the city of having to pay for lateral replacement, but there is also this section:
32(c) The Master Plan shall include an analysis as to whether the replacement of private laterals by the City in conjunction with any sewer line work undertaken for capacity reasons would be a cost effective means of I/I reduction.

In other words, replace 'em as you go about what you have to do anyway.

What does that analysis say?

You'd think since we're going to face higher sewer taxes ad infinitum and three potential bond issuances because the city never dealt with basic maintenance and repair, that we at least could get some help.

question? said...

Is this cause of the sewer spill that Jimmy V. & "Sneaky" Pete, said was only tar balls?

Anonymous said...

is this decree on the city website? If so where?

Lionel Emde said...

I have a copy of the decree I got from one of the plaintiff's attornies, I'll send the pdf to Steve for posting.

Anonymous said...

jeez laweez now they're making it harder to sell your house so you escape from Pacifica which is quickly becoming the 7th circle of hell

The Spin Doctor said...

Mary Ann,



You are correct…



HOWEVER, the Consent Decree says, “As part of this program, by November 15, 2011, the City shall adopt an ordinance with provisions at least as stringent as requiring (a) inspection of private sewer laterals upon sale of property, upon issuance of a permit for a major

remodel (>$75,000), and upon issuance of a permit for any remodel that adds a bathroom or plumbing fixtures; (b) replacement of defective private sewer laterals by a specified deadline after inspection and (c) receipt of evidence from landowners that defective private sewer laterals have

been repaired, rehabilitated, or replaced as condition to closing a sale or the City's sign-off on a permit for a remodel. The ordinance may allow the repairs or replacement triggered upon sale to be completed within a reasonable time after closing provided it shall contain adequate compliance enforcement mechanisms. The City shall thereafter make reasonable efforts to enforce the ordinance.” (emphasis added)




The Consent Decree says the city shall adopt an ordinance… IT DOES NOT SAY WHAT THE EFFECTIVE DATE OF THE ORDINANCE IS TO BE. Point being, the ordinance can be introduced for adoption on Nov. 14 (thus beating the Nov. 15 deadline) and the Council can make the effective date April 15, 2012 so as not to incur any penalties. I’m sure BayKeepers/Our Children’s Earth Foundation/The Rose Foundation (they’re all the same group as you know) will not be amused but the action will fall within the wording of their own Consent Decree.



I suspect you’ll need to run this by the City Attorney… which would be another reason to introduce and defer adoption to allow the City Attorney to research the adoption/effective date issue.



Hope this helps.



Respectfully,

Paul Stewart

Government Affairs Director

San Mateo County Association of REALTORS®

850 Woodside Way / San Mateo, CA 94401

Anonymous said...

Just tuning in. Is the mayor posting as The Spin Doctor? That's way too funny. Or am I just not following this conversation closely enough? Citizen Mayor with handy psychiatric skills posts as The Spin Doctor?? Too droll. Love it!

Thomas Clifford said...

The only thing I have to add is that the ordinance as posted in the agenda packet calls for a >$50,000.00 trigger on remodels not >$75,000.00 as stated above.

mi casa u casa said...

Does this mean Jimmy V will have to replace his sewer pipes or did the city go out and do this for him yet?

BTW more people will do remodels without permits now or bring in the total cose just under the trigger.

No code enforcement officer out on the streets any more? Unless they are going to send "Sneaky" Pete out to look for new remodels??

Many thanks to the 2 meatheads, dead from the neck up on City Council.

They have driven the city into the ground!

Common Sense said...

The Council says they "have" to pass this Monday nite. The council is also the one that regotiated this travesity. This point-of-sale ordinance is being driven by a bunch of eco-nazis. These groups bring a bad stigma, a stink if you will, to environmental activism. This doesn't come close to taking care of the lateral issue. 2% of the homes change hands each year. Simple math tells you it would take 50 years to fix them all. Well, that is just one of many flaws in this ordinance. Many homes change hands over and over. Small homes turnover fast because families grow and move up to larger homes while new families move into the starter homes. What's to keep these fee driven eco whores from coming back to the Pacifica trough over and over to pick at an easy target?!

Thomas Clifford said...

I am pretty sure that once a house has ether passed it's inspection or had it's sewer lateral replaced it receives a certificate that is good for 20 years. I'll reread the ordinance an confirm that.

Thomas Clifford said...

Common Sense, Try not to be to hard on the City Council about this settlement. They made the best of a bad situation. We were going to have to pay the fines anyway this way most of the money is going into programs that will fix the problem.

With a lot of hard work and a little luck we won't be fined again.

Anonymous said...

Sure we're stuck with it but it's a bad situation some of them knowingly created. All that money that was siphoned off (legally) for years from the sewer funds could have prevented this disaster from landing so fully on the homeowners. Once this problem becomes part of realtor's and buyer's perceptions of Pacifica, selling a home here will be just that much harder. Nice one City Council! Wonder how many of them are going to share in this little adventure?