response to ldeq consolidated compliance order and notice of potential penalty
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Response to LDEQ Consolidated Compliance Order and Notice of Potential Penalty. LPDES Overview. ♦ Wastewater system discharges to the Mississippi River. ♦ Requires a Louisiana Pollutant Discharge Elimination System (LPDES ) permit .

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Presentation Transcript
lpdes overview
LPDES Overview

♦ Wastewater system discharges to the Mississippi River.

♦ Requires a Louisiana Pollutant Discharge Elimination System (LPDES) permit.

♦ Permit requires operating the collection and treatment facilities under the terms and conditions of the LPDES permit or face civil fines.

♦ The Louisiana Department of Environmental Quality (LDEQ) is responsible for enforcement all permit requirements.

CORRECTIVE ACTION PLAN

ldeq background
LDEQ Background

♦ LDEQ conducted several inspections of wastewater facility records and discovered 444 overflows had occurred within the system.

♦ Age of the system, poor soil conditions causing subsidence, and lack of maintenance over the years contributed to the overflows within the sewer system.

♦ On August 26, 2009, the City received a Consolidated Compliance Order and Notice of Potential Penalty Enforcement Tracking No. WE- CN-09-0174 for noncompliance activities from February 1, 2004 through May 31, 2009.

CORRECTIVE ACTION PLAN

summary of overflows
Summary of Overflows

CORRECTIVE ACTION PLAN

importance of regulatory compliance
Importance of RegulatoryCompliance
  • Why is it important for the COK to meet its LPDES permit requirements?
    • ♦ Overflows discharge raw sewerage into nearby roads, drainage, and waterways
    • ♦ Threat to public health, animals, the environment and the federal and state waterways.
    • ♦ Violation of the Federal Clean Water Act
    • ♦ The City’s failure or refusal to comply with the Compliance Order could result in the assessment of a civil penalty in an amount of not more than $50,000 for each day of continued violation or noncompliance resulting in possible millions of dollars of fines.

CORRECTIVE ACTION PLAN

response to the compliance order
Response to the Compliance Order
  • ♦ In response to the Compliance Order, related to the reported Overflows, the City was required to prepare a Sanitary Sewer System Overflow Corrective Action Plan.
  • ♦ Purpose of Corrective Action Plan
  • -mitigate, reduce, and prevent Overflows in the City
  • -comply with LPDES discharge permit requirements, related Louisiana Laws, and the Federal Clean Water Act.
  • ♦ $62,137,196 total in capital improvements to reduce and prevent future overflows
  • ♦ Corrective Action Plan only considered the SSO’s cited in the LDEQ compliance order and was not meant to correct every deficiency in the City’s system.

CORRECTIVE ACTION PLAN

corrective action improvements funded
Corrective Action ImprovementsFunded

Funded Improvements

♦ These improvements will be completed without any additional tax or fee

increase

♦ LRA/CDBG Grant Money does not have to paid back.

♦ A list of funded improvements is available separately

CORRECTIVE ACTION PLAN

corrective action improvements future funded projects contingent upon sewer fee increase
Corrective Action ImprovementsFuture Funded ProjectsContingent Upon Sewer Fee Increase

Future Funds Required

♦ A list of future projects is provided separately

♦ $6,900,000 planned for “Green Project”

+ Discharge to La Branche Wetlands

+ Provides wetland restoration and enhanced Hurricane Protection

CORRECTIVE ACTION PLAN

budget observations and comparisons
Budget Observations and Comparisons

♦Last user rate increase 19 years ago (1991)

♦ Cost of equipment, repair, services and electricity, chemicals and inflation have risen significantly.

♦ City does not collect enough revenue currently to operate and maintain the system

♦ There is insufficient funds within the City to pay for the plan along with operation and maintenance costs

CORRECTIVE ACTION PLAN

proposed rates
Proposed Rates

♦ An estimated $44,053,053 of additional funding is needed.

♦ Necessary to consider a user rate increase or face possible civil penalties.

♦ Phased increase to meet future expenditures for principal and interest.

♦ Pay as you go for citizens through increases over four years

♦ Two separate bond issues proposed to spread out the increase

CORRECTIVE ACTION PLAN

proposed rates11
Proposed Rates

♦ 2011 increase to $2.01 per 1,000 gallons covers operating and maintenance

and remaining LDEQ loan money

♦ 2012 increase to $2.63 per1,000 gallons covers first municipal bond

of $16 million

♦ 2013 increase to $2.68 per 1,000 gallons covers the estimated

CPI increase in 2013

♦ 2014 increase to $3.031per 1,000 gallons covers second municipal bond

of $16 million

CORRECTIVE ACTION PLAN

proposed rate chart
Proposed RateChart

CORRECTIVE ACTION PLAN

sewer rate comparisons
Sewer Rate Comparisons

CORRECTIVE ACTION PLAN

utility comparisons
Utility Comparisons

CORRECTIVE ACTION PLAN

options
Options

♦ Do nothing – Millions of dollars in possible fines from LDEQ and EPA

plus the City still will be expected to pay for repairs to the system

♦ Increase fees to levels shown

+ Fair to users because proportionate use pays for system

+ Few City services produce revenue to pay for itself

CORRECTIVE ACTION PLAN

consequences of no action
Consequences of No Action

♦ If sewer fee increase is not approved outstanding bills owed to system operator (Veolia)

will continue to increase

♦ LDEQ will take back the remaining $11,000,000 in low interest (0.95%)

loan money

♦ EPA will step in for violation of Clean Water Act

♦ Taxes may increase to pay fines

♦ City services may be cut that don’t generate revenue (Recreation,

Community Services, etc.)

CORRECTIVE ACTION PLAN

conclusions
Conclusions

♦ Fee increases are not popular but to take no action would be irresponsible and cost more over time

♦ 2014 the average residential homeowner would pay $26.45 per month for its wastewater services.

♦ Comparable to other utilities and municipalities the proposed rates are not out of the ordinary

CORRECTIVE ACTION PLAN

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