ITEM:

ACTION ITEM

 

10.

CONSIDER APPROVAL OF RESOLUTION 2024-13 SUPPORTING CLOSURE OF OPEN WATER PERMITS BY IMPLEMENTING A ONE-TIME AMNESTY PERIOD

 

Meeting Date:
October 21, 2024

Budgeted: 

N/A

 

From:

David Stoldt

Program/

N/A

 

General Manager

Line Item No.:

 

 

 

Prepared By:

Water Demand Division

Stephanie Locke

Cost Estimate:

N/A

 

General Counsel Review:  Yes.

Committee Recommendation: Water Demand Committee supported concept of “amnesty” period and use of District Reserve to close open Water Permits.

CEQA Compliance:  This action does not constitute a project as defined by the California Environmental Quality Act Guidelines Section 15378. 

 

SUMMARY:  The Water Demand Division has two Conservation Representatives responsible for inspecting properties to ensure compliance with permit and conservation requirements. Each year, the District issues approximately 850 Water Permits. In addition to permitting, the District conducts over 700 permit inspections and more than 900 conservation inspections. In many cases, these inspections overlap. Unfortunately, approximately 25 percent of the permit inspections fail, primarily due to unapproved water fixtures added without amending the Water Permit.

 

Common Reasons for Inspection Failures

Properties frequently fail inspections for the following reasons:

 

·         No Water Permit – Unpermitted water fixtures (residential) were found during the inspection and there is no open permit.

·         Wrong toilets or water fixtures – Site was required to have lower toilet flush volume or flow rate than installed.

·         Wrong appliance – Dishwasher, clothes washer, hot water system, etc., did not meet requirement.

·         Less water fixtures –All permitted fixtures were not installed, and an amendment is required.

·         Landscape Water Permit required – There was new landscaping or a refurbished landscape that required a Landscape Water Permit.

·         Landscape change –Landscape was not installed according to the Landscape Water Permit.

·         New structure requirements (instant access hot water system, submeter) were not installed.

·         Wrong water source – Used potable water in place of well water.

·         There is a Notice of Non-Compliance on the title (rationing, Change of Ownership, etc.).

·         Did not successfully complete permanent removal of water fixture.

·         No Water Distribution System Permit – The project is on a well, but the proper permit was not secured.

·         No landscape submeter was installed when there was a Landscape Water Permit.

·         Wrong urinals were installed in a non-residential use.

·         A leak or leaks were identified that require corrective action.

·         A non-residential change of use was not permitted properly or at all.

·         Non-residential use is missing non-residential conservation signage or other conservation/water waste requirements.

 

As the District prepares for the allocation of water from the Pure Water Monterey Expansion (PWM), the focus is on resolving “open” permits – those that have not achieved a successful final inspection or have other compliance issues. There are approximately 1,600 open permits from 1993-2022.

 

Over the past 15 years, the District has made significant investments in two large-scale database projects to manage its demand management programs. The current database now contains nearly 40,000 individual property records. The most recent system, called Accela, is particularly capable of handling the follow-up required for non-compliant, "open" permits. With the Accela program, staff is prioritizing the completion of final inspections for open permits. This is the first step in the effort to close these permits efficiently. After this initial phase of final inspections, there will be a need to follow up on the other non-compliant permits to ensure full compliance across all records.

 

Types of Open Water Permits

 

1.      No Final Inspection: A condition of a Water Permit is a final inspection to verify that the permitted fixtures were installed. The District requires the property owner or agent contact the District upon project completion to schedule the inspection and this information is noted on the Water Permit and stamped plans. The final inspection may not be scheduled for several reasons, including: the contractor or agent who signed for the permit failing to arrange the inspection; the property owner being unaware of the inspection requirement due to having an agent manage the permit; ownership transfers where new owners are not informed of the open permit; or situations where the project was never completed, and the owner or agent did not notify the District.

 

2.      Final Inspection with Violations: When a property fails an inspection, the property owner (and, in some cases, the Jurisdiction) is notified. The owner has 30 days to make the necessary corrections, or further action may be initiated. A follow-up letter informs the owner that a Notice of Non-Compliance will be filed on the property title if the corrections are not completed within a specified timeframe.

 

3.      Notice of Non-Compliance Recorded: Properties that have a Notice of Non-Compliance due to unresolved violations.

 

4.      Unpermitted Fixtures Identified: Sites identified during inspections as having unpermitted fixtures, but lacking a Water Permit, are not classified as "open" permits. However, they still require a Water Permit to comply with District regulations and should be included in the proposed amnesty period.

 

Resolution 24-13 introduces an "amnesty" period that extends until September 2025. During this time, property owners with open permits will have the opportunity to clear their violations more easily. This will be achieved by temporarily suspending certain rules, thus reducing the burden on property owners and encouraging them to resolve outstanding issues without facing significant hardship. The intended outcome is to achieve substantial compliance and close permits that might otherwise remain unresolved for an indefinite period.

 

RECOMMENDATION: Staff recommends the Board adopt Resolution No. 2024-13 (Exhibit 10-A) to authorize the use of the District Reserve Allocation and suspend specific rules to facilitate the closure of older open Water Permits.

 

The Water Demand Committee met on October 3, 2024, to discuss the background and classification of permits, focusing on the idea of an amnesty period and the utilization of the District Reserve Allocation. The committee agreed to create a level playing field by incorporating the District Reserve into the process. Staff was tasked with refining and detailing these program concepts to present to the Board for further consideration during the October meeting.

DISCUSSION: Staff is requesting Board approval of Resolution No. 2024-13 to help close certain open Water Permits and address unpermitted water fixtures by temporarily adjusting several rules and waiving fees through September 30, 2025. The following is a breakdown of the key actions being proposed:

1.      Utilization of the District Reserve Allocation:

·         This ensures a fair and equitable process while preserving the District Reserve for those who don’t already have a water Entitlement. The Entitlements act as a first resource for those property owners, while the District Reserve provides a back-up for other properties without such pre-purchased water rights.

2.      Suspension of Rule 21 (Applications), Section B-2:

 

·         The requirement for complete construction plans for modifications found during final inspection will be suspended as most of these projects have been completed for many years.

·         Any unpermitted fixtures are documented during inspection.

3.      Suspension of Rule 23 (Process):

·         Section A-1-k: The collection of a Capacity Fee will be suspended. The current Capacity Fee is $35,019 per acre-foot, or $363.50 per fixture unit.

·         Section A-1-m: The requirement for staff to stamp construction plans (except for landscape-related permits) will also be suspended.

4.      Suspension of Capacity Fees under Rule 24:

·         Section A-1-e-(1) (Residential Water Use Capacity Calculation) and Section B-1-g-(1) (Non-Residential Water Use Capacity Calculation) will be suspended, removing the need to pay Capacity Fees to close open permits during the amnesty period.

·         This will reduce financial hardship, particularly for property owners who did not own the property when the violations occurred.

5.      Suspension of Fees under Rule 60-K (Fees Related to Permit Modification or Enforcement):

·         Administrative and legal fees will be waived for the specific permits covered by the resolution. This includes fees for permit processing, deed restriction preparation/review, recording costs, Capacity Fees, and inspection fees.

·         On average, these fees amount to about $142, with an additional $152 if a deed restriction needs to be amended.

By suspending these fees and rules, the resolution aims to encourage property owners to resolve their violations without facing financial or administrative burdens.

 

Implementation of Amnesty Period

The staff proposal recommends limiting the amnesty period to a specific group of older permits that have remained "open" in the District’s database. The amnesty period would apply to Water Permits issued prior to October 1, 2022, that are still in an "open" status. These older permits represent cases where projects were either incomplete or unresolved in the District's records, and the goal is to bring them into compliance during the amnesty period.

 

The permits that would qualify for closure under the proposed amnesty period include those in the following circumstances:

 

1.      Open Water Permits with No Final Inspection

 

An ongoing effort is focused on reaching out to current property owners who hold open Water Permits issued between 1993 and 2017. These owners are being requested to schedule the final inspection needed to close their permits. Approximately 1,500 permits from 1993 through 2016 remain in an “open” status without a final inspection.

For permits issued after 2017, the District has already sent letters to property owners, and Notices of Non-Compliance have been recorded for those who did not take action to contact the District or close the permit.

This current effort will have three potential outcomes for each permit:

·         Final Inspection Completed: The property owner complies, and the permit is closed after inspection.

·         No Action: The permit remains open if no response or action is taken by the property owner.

·         Extension of Time: The property is still under construction, and more time is granted for completion and compliance.

By utilizing the proposed rule suspensions (such as the waiving of certain fees and requirements), staff anticipates that a significant number of these permits can be closed during the amnesty period. This streamlined process will reduce the administrative burden and make it easier for property owners to resolve their open permits.

It's important to recognize that Water Permit requirements have evolved over the years. When conducting a final inspection for an open permit, staff will refer to the requirements that were in place at the time the permit was originally issued, rather than current standards. This means that if an older permit is being closed, it will not be subject to today's efficiency requirements, such as those for ultra-high efficiency toilets or rain sensors. The focus will remain on ensuring compliance with the regulations that applied when the permit was issued, allowing property owners to close their permits without needing to retrofit or upgrade to meet current codes.

2.      Open Non-Compliant Permits, including Properties with Notices of Non-Compliance

Approximately 50 properties that failed inspections between 1993 and 2017 due to unpermitted fixtures have received Notices of Non-Compliance for their violations. Staff plans to proactively contact the property owners of these sites, providing them with information about the amnesty period and guidance on how to rectify their violations.

Key points regarding this outreach and the consequences of non-compliance include:

·         Information and Guidance: Property owners of sites with Notices of Non-Compliance that failed inspections due to unpermitted fixtures between 1993 and October 1, 2024, will receive detailed information on the amnesty period, including how to proceed with correcting their violations and the steps needed to obtain the necessary permits.

·         Deadline for Compliance: The amnesty period will be available until September 30, 2025. Property owners are encouraged to take action within this timeframe to avoid further penalties.

·         Consequences of Non-Compliance: If property owners do not take advantage of the amnesty period and remain non-compliant after it concludes, the following actions may occur:

Collection of Fees Owed: The District will begin collecting any outstanding fees associated with the unpermitted fixtures.

Debits to the Jurisdiction’s Allocation: There may be impacts on the allocation of water to the jurisdiction where the non-compliance is noted.

Legal Enforcement: In cases of continued non-compliance, the District may need to pursue additional legal actions to enforce compliance.

3.      Properties that did not have a Water Permit on file, but unpermitted water fixtures were found on inspection.

 

There are some inspections that occurred for a transfer of ownership prior to 2017 that remain non-compliant. Once the two previous groups have been targeted, staff will attempt to identify and contact these property owners to permit the fixtures.

 

Communication Strategy

In addition to the letters sent to holders of open permits, the District will implement several outreach strategies to ensure that property owners are aware of the amnesty period and the opportunity to address non-compliance issues. These strategies include:

 

Legal Notices: At least two legal notices will be published in both the Carmel Pinecone and the Monterey County Weekly. This will help to reach a broader audience and inform the community about the amnesty program.

 

Collaboration with Local Organizations: Staff will engage with the Monterey County Association of Realtors and managers in the planning and building departments to disseminate information about the program. This collaboration seeks to ensure that real estate professionals and municipal staff are well-informed and can assist property owners in understanding their options.

 

Summary Report to Jurisdictions: At the conclusion of the amnesty period, the District will provide a summary of the remaining non-compliant properties to the relevant jurisdictions. This report will allow local authorities to review the status of these properties and take appropriate actions to bring them into compliance.

 

Opportunity for Compliance Before Debits: Jurisdictions will have the opportunity to address any remaining non-compliance issues before the District debits their PWM (Pure Water Monterey) Allocation after the amnesty period. This proactive approach aims to prevent further implications for the jurisdictions while encouraging property owners to resolve their violations.

 

These outreach efforts are designed to maximize awareness and participation in the amnesty period, ultimately leading to improved compliance and responsible water management within the community.

 

Conclusion

Going forward, the District will ensure all Jurisdictions are engaged in the inspection process to prevent permit final inspections from being overlooked. Ongoing communication with each Jurisdiction will emphasize the importance of final inspections.

 

EXHIBIT

10-A       Resolution No. 2024-13, Supporting Closure of Open Water Permits by Implementing a One-Time Amnesty Period

 

 

 

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