Morro Bay and Cayucos have shared a wastewater treatment plant in relative harmony since the 1950s, but a 2013 permit denial changed all that. Now the neighboring towns are working to create their own facilities.

Morro Bay residents have resisted efforts to find a new site, leaving the city looking into a third proposed project site and cost hike. Cayucos, however, is on its way toward constructing its facility in June. The plant they currently share butts right up against the ocean in Morro Bay.

Rob Livick, public works director for the city of Morro Bay, said that plant was upgraded in the mid-1980s. The facility currently has a waiver allowing it to discharge primary and secondary effluent—also known as treated sewage water—into the ocean. Livick said when he joined the public works staff in 2007 he noted that the facility could be in danger of flooding from the ocean or a storm.

“At the time that spot made sense, it was during the development of the power plant so a lot of that area down there is zoned industrial,” he said.

In 2005, the two municipalities started working to give the wastewater treatment plant another upgrade by rebuilding the facility at the spot it now stands. Rick Koon, Cayucos Sanitary District manger, said at the time the Cayucos district sent a letter to the city of Morro Bay asking them to halt the project so it could consider the upgrades and project designs. But Morro Bay didn’t acquiesce and instead presented the upgrade project to the California Coastal Commission. In 2013, the commission denied them a coastal development permit due to infrastructure and environmental impact concerns.

Livick said that the incoming City Council at the time accepted the commission’s decision with the idea that Morro Bay could use the property for something else.

“There might be better public use of this property and, quite frankly, income-generating use of this property, for visitors rather than wastewater treatment services,” he said.

After the project denial, Morro Bay worked toward drafting alternative project sites and a new joint powers agreement with the Cayucos district, enlisting them as a customer of the city rather than a co-owner.

“Since we were tasked with drafting the agreement, the person tasked with drafting it typically writes it to what they want to see to it. But it was subject to negotiations,” Livick said.

Koon said if Cayucos were to accept the newly drafted agreement it wouldn’t have voting rights on the final decision of the project’s development and construction process.

“Cayucos would be subject to Morro Bay water rates without any oversight,” he said.

In April 2015 the Cayucos Sanitary District adopted a resolution stating that it would not participate in the project proposal with Morro Bay.

Morro Bay is still working through the process of its third site proposal as neighbors of the previous suggested sites complained about having a facility in their backyard. The current site under consideration is off Highway 1 and South Bay Boulevard and would focus on a technologically advanced way of treating the water as well as agricultural water reuse. Livick said that the newly updated facility master plan recommends two alternatives to treat the wastewater: a sequencing batch reactor and a membrane bioreactor.

He said the city is in the process of starting the environmental impact report and anticipates the report to be ready for review this summer.

“We think we have the best proposed site, that is a compromise site as most are,” he said.

With the new project plan comes a new price tag that’s estimated to be between $150 million and $168 million. It’s a substantial increase from the initial estimates: The first proposal in 2013 was estimated to cost $100 million, and the second proposal in November of 2016 was between $126 million and $140 million. Livick said cost increases are due to the new location, infrastructure, and the community’s goals.

“We want to treat [wastewater] to the highest level and be able to reuse the water, and well, that comes at a cost,” he said.

Another reason for the cost hike, according to Livick, is the time delay the project has experienced while the city was looking for more alternative sites for a new facility.

Looking at the high costs Morro Bay’s facing, Cayucos Sanitary District Manager Koon said it made sense for Cayucos to follow its own path.

“Their costs are just skyrocketing; every time you look, they’re going up another $25 million,” he said.

If Cayucos had stayed in a joint agreement with Morro Bay, it would have had to pay 30 percent of those project costs on top of the water rates the city will be putting into place.

Koon said the sanitary district proposed a $20 million plant that would use the membrane bioreactor process to treat the wastewater, similar to Morro Bay.

The Cayucos district purchased property off Toro Creek Road in Morro Bay and closed escrow in July 2016. With a completed environmental impact report, the district is currently in the process of receiving public comment.

“We can build a smaller, more efficient plant that uses less energy than our portion of the existing plant, and it’s closer to the community,” Koon said.

Once both local agencies have established their own wastewater treatment plants, the current facility will eventually need to be disposed of.

“We know we have to get rid of the plant, and finally it’s going to be gotten rid of, but we haven’t discussed that yet,” Koon said.

 You can reach Staff Writer Karen Garcia at [email protected].