HomeMy WebLinkAboutStaff Report 4.E 01/27/2020DATE:
TO:
FROM:
SUBJECT
Agenda Item #4.E
January 27, 2020
Honorable Mayor and Members of the City Council through City Manager
Jason Beatty, P.E., Interim Director, Public Works and Utilities Department
Jonathan Sanglerat, Assistant Engineer II, Public Works and Utilities Department
Discussion and Direction on Dredging of the Petaluma River, Marina, and
Turning Basin and Budget Adjustment for Dredging, e14502024
RECOMMENDATION
It is recommended that the City Council consider the information presented and provide
feedback and approve a program budget adjustment for dredging, e 14502024.
BACKGROUND
The Petaluma River has not been fully dredged since 2002, and the Petaluma Marina not since
1998, except for a minor emergency dredge after the 2005 / 2006 New Year floods. As a result,
the River, especially the Turning Basin, and the City Marina have silted up, forming shoals, and
causing severe restrictions to access by commercial and recreational vessels during most of the
daily tide cycle. While River dredging is not a City responsibility, the lack of dredging is
significantly affecting business interests, regional boating interests and the vitality of the City's
riverfront. Significant shoaling has caused the cancellation of the annual "Lighted Boat Parade"
and other nautical events hosted by the Petaluma Yacht Club in the Turning Basin. Barges from
local aggregate hauling companies reportedly operate at less than half full and only during rising
tides to avoid running aground. The U.S. Army Corps of Engineer's 2015 Preliminary
Assessment of the Petaluma River dredging project estimated downtown business revenue losses
at $1.3 million annually from the lack of dredging. Small craft users and organizations are
increasingly challenged to get access the river due to the build-up of silt along its length. In the
Marina, where dredging is a City responsibility, the occupancy of vessels leasing berths has
steadily declined and is now below 40%, when the Bay Area average is nearly 80%.
The U.S. Army Corps of Engineers (USACE) is responsible under a federal mandate to perform
maintenance dredging of federal channels such as the Petaluma River and, at one time, dredged
the River every four to six years. Largely as a result of efforts by Congressman Jared Huffman
and the political consortium, the Federal government provided $600,000 in 2017 to the USACE
to update dredge sediment disposal plans, obtain permit approvals, and prepare contract
documents for dredging of the Petaluma River. At this juncture, USACE is permitted and has the
design package at 60% and reportedly is ready to dredge this year, subject to additional federal
funding of up to $10,000,000 to dredge approximately 300,000 cubic yards of River sediment
from the upper Petaluma River, from approximately the City Limits up to the turning basing, and
200,000 CY of material from the Petaluma River Channel in San Pablo Bay, known as the
`Across the Flats' section of the channel. The material will be deposited either at the
Shollenberger Dredge Sediment Decanting Site, to an approved "in -bay" deposition site in the
San Pablo Bay, or at a beneficial re -use site, such as Cullinan Ranch operated by Ducks
Unlimited.
While the City is hopeful to soon obtain word from the USACE that funding for the Petaluma
River will be included in their work plan for this year, staff with the 1St quarter budget
adjustment approved by Council has moved forward with permitting and contract preparations
for maintenance dredging of the Petaluma Marina and a partial dredging of the Petaluma River
channel and the Turning Basin during the 2020 summer dredging "window." If the USACE
obtains funding for the Petaluma River project, the City would not need to proceed with the
River and Turning Basin portion of that plan. The dredge project team submitted permitting
documents to obtain a 10 -year maintenance dredging permit for the City's Marina and the
Federal river channel, if ever necessary. A specialist consultant was hired to complete the multi -
agency permitting process including the very arduous task of testing sediment samples to
determine suitability of sediment placement at the Shollenberger dredge disposal site, the in -San
Pablo Bay site designated SF -10, and the beneficial reuse site at Cullinan Ranch on Mare Island.
The Sediment Analysis Plan (SAP) has been approved by the DMMO (dredge material
management office) agencies comprised of at least six State, Regional and Federal regulatory
agencies. Sediment samples were taken during the week of November 11, 2019 and the
completed permit submittal is anticipated before the end of January with all necessary data and
project information. The City is also seeking approval to dredge the Marina from the State Lands
Commission (SLC) under the terms of its current SLC lease for the Marina and expects to
finalize this process before award of the contract.
This project meets the following City's Goals:
• Workplan item #116 — "Maximize use of current parks and recreation infrastructure, and
other City -owned facilities and properties for the hosting of recreational, sports, cultural
and entertainment events that attract visitors to Petaluma."
• Workplan item #117 — "Identify short and long-term funding solutions for dredging of
the Turning Basin and federal channel by coordinating with other dredging efforts in the
Bay Area; dredge the City Marina, coordinate with Bay Area wide dredging efforts."
• Workplan item #118 — "Support Federal dredging efforts of the river channel by
maintaining a viable dredge disposal site option at Shollenberger and explore sustainable
long-term beneficial reuse sites for disposal."
DISCUSSION
Staff has targeted a dredging project budget that would be approximately $2,000,000 of City
funds. It is anticipated that a portion of the FY 21 estimated cost will be funded by the Parkland
Development Impact Fee fund and the remainder through a proposed interfund loan from the
City Facility Impact Fee fund. As discussed in more detail in the "Financial Impacts" section
K
below, the interfund loan from the City Facility Impact Fee Fund would be repaid by future
Transient Occupancy Tax revenues over a 5 -year period. This funding strategy would avoid
dipping into General Fund reserves for this project. Given a $2,000,000 target budget amount,
staff has identified that one of the following project alternatives could be executed within the
budget amount:
1. To remove an estimated 91,000 cubic yards (CY) of material from the Marina, restoring
the Marina to its design depths of 8 ft and 10 ft, or;
2. Remove approximately 58,000 CY from the Marina to get it to depth of 6 feet
throughout; and remove an estimated 33,000 CY of material from the Turning Basin and
a 50 -foot wide channel from D Street downstream to the entrance to McNear Channel to
a depth of 6-11. This alternative would allow most recreational vessels, at most tide levels
to access the Marina and the Turning Basin, or;
3. Remove approximately 91,000 CY of material from the Turning Basin and Petaluma
River to create a channel 50 -ft wide and 6 -feet deep from the entrance to McNear
Channel to the Turning Basin and dredge the Turning Basin to its design depth of 8 -feet.
If direction is received to move forward with one of the above options, bidding for the work
would be planned for March 2020, once the City is assured that the permits will be issued in time
for the summer "dredge window". Dredging may begin as early as June after permits are issued
and the work is awarded to a qualified dredging contractor. The dredging activity is expected to
take most of the dredge window from June to November depending on final decisions by the
DMMO agencies.
The City is also exploring the opportunities for partnership with Ducks Unlimited that operates
the permitted dredge material beneficial re -use and wetland restoration site at Cullinan Ranch.
The site is designed to accelerate the restoration of the wetland marshes on the north tip of Mare
Island and add resiliency against sea level rise impacts. The City is supporting their efforts to
obtain funding through a San Francisco Bay Restoration Authority grant to offset the additional
costs associated with transporting and offloading dredge sediment material to Cullinan Ranch.
Since the cost to transport and off load at Cullinan Ranch is more than the other two available
sites, the funding would offset the additional costs to assure that material from the Petaluma
River is put to beneficial reuse. If funding does not become available through the Measure AA
grant, the USACE and City will deposit materials at Shollenberger or at the San Pablo Bay site.
Staff continues to work towards developing a sustainable plan to complete regular dredging of
the Petaluma River Channel, Turning Basin, and Marina. This is in anticipation that Federal
funding for dredging will not significantly increase from where it is at now, and the frequency at
which USACE will be able to dredge will be 15 or more years.
In looking to the long-term, staff is currently working on two fronts, which are not exclusive of
one another. First, the City is continuing an effort to partner with the five other agencies in the
North Bay that have a vested interest in maintaining the Shallow Draft Channels of the North
Bay, which the Petaluma River, San Rafael Channel, and the Napa River. The City took lead on
the submission of proposals to the USACE for a regional Project Partnership Agreement (PPA)
on this effort in 2017, and a Pilot Beneficial Reuse Project in March 2018. The USACE has been
unable to move forward on the PPA since a subsequent Congressional directive was issued to the
USACE to develop a plan for evaluating and awarding these proposals. Staff is recommending
continuing to explore this regional long-term planning effort, as it may provide additional
avenues for realizing a sustainable program. It is expected that the USACE will eventually
develop the needed guidance for the program and be able to evaluate and participate in these
partnerships. Leveraging a regional partnership would provide additional incentive for USACE
to participate.
Staff is also looking to explore the opportunities for a long-term plan that would beneficially re-
use dredge material from the Petaluma River in wetland restoration along the Petaluma River for
habitat restoration and to help begin to address impacts of sea level rise. In this effort the City is
an integral partner with non-profit organizations, and other agencies with an interest in
preserving, protecting, and enhancing the Petaluma River and the watershed. Staff intends to
continue to work with these partners to develop a planning effort that will lead to grant funding
application for Measure AA funds or other sources. This long-term planning effort would look to
utilizing sediment from regular maintenance dredging to restore and enhance habitat and
improve resiliency against climate change and sea level rise. This effort could be incorporated
into a regional approach as well.
PUBLIC OUTREACH
A public workshop updating the Council on the status of dredging was held in November 2017.
The USACE staff was in attendance and provided an update of their activities.
At the April 6, 2019, City Goal setting workshop, dredging the Marina, Turning Basin, &
Federal Channel can out as one of the top objectives for infrastructure and for the economy and
downtown.
Upon request, City staff provided an update to the Chamber of Commerce's Government
Advisory Committee in May 2019.
The Mayor's Dredge Pledge initiative resulted in over 2,300 supporters signing a petition to
inform USACE of the community's support for dredging. This initiative included an event at the
Petaluma Yacht Club on July 16, 2019, attended by the mayor, council members, and staff.
A City Council Letter to USACE, Senators Feinstein and Harris, and Representative Huffman
requesting dredging of the Petaluma River was presented and signed at the August 5, 2019, City
Council meeting.
The CEQA and NEPA processes for the dredging of the Marina and the Federal Channel will be
followed as the projects move forward and include public noticing. Outreach to stakeholders will
increase as the permitting and construction documents are developed.
0
FINANCIAL IMPACTS
A first quarter budget adjustment of $173,000 was approved by Council on November 18, 2019
to fund the permitting and design for the Petaluma Marina dredging and preparing for Petaluma
River dredging. An additional budget adjustment of $300,000 for FY 19-20, would be needed to
cover expected mobilization and initial dredging costs, and the funding for the remainder of the
dredging would be needed and requested through the CIP budget approval process for FY 20-21,
as outlined below. Funding options are limited as the City does not have a dedicated funding
source for Marina or River dredging. It is anticipated that a portion of the FY 21 estimated cost
will be funded by the Parkland Development Impact Fee fund and the remainder through a
proposed interfund loan from the City Facility Impact Fee fund.
The proposed loan is structured to provide funding of $1,343,000 with annual debt service
payments of approximately $287,414 spread among potential sources including the Transient
Occupancy Tax, Petaluma Tourism Improvement District and Measure M funds, over a 5 -year
period, at an interest rate of 2.30%. This interest rate is .30% more than the fund would have
earned over the past 2 years by investing in the City's pooled account and is more than the rate
the portfolio is currently earning. The interest rate paid is also less than the rate that would be
paid should the City do an external borrowing.
The Transient Occupancy Tax fund has adequate fund balance to cover the FY 20 budget
adjustment of $300,000 and has ongoing resources sufficient to cover the annual interfund loan
payment. Hotel occupancy remains strong and revenues generated continue to show a growth
rate slightly greater than the budget and long-term forecasts reflect. It is anticipated that
additional transient occupancy tax revenues will be recognized over and above forecasted
amounts due to the addition of new hotels currently in the preliminary planning stages of
development. Due to both reasons mentioned above, the impact to the overall fund balance
resulting from the annual interfund loan payment is expected to be minimal.
Uses (Dollars in $000)
Planning/Environmental
Land/Easements
Design
Legal Services
Administration
Construction Contracts
Construction Management
Contingency
CIP Overheads
Total Uses
Marina and River Dredging
e14502024
FY 19-20 Current FY 19-20 FY 20-21
Currently Budget Revised
Approved Adiustment Budget
$ 93 $ 93
$ 80 - $ 80
$ 300 $ 300 $ 1,550
- - $ 50
- $ 100
$ 173 $ 300 $ 473 $ 1,700
Sources (Dollars in $000)
Transient Occupancy Tax (TOT) $ 173 $ 300 $ 473
Parkland Development Impact $ 357
Interfund Loan $ 1,343
Total Funds $ 173 $ 473 $ 1,700
After dredging of the Marina, revenues are expected to gradually increase as occupancy of the
Marina increases from 39% to an estimated 80% occupancy that is realized on average in the
Bay Area. This increased funding could be used for a variety of costs such as operations, and
much needed repairs and maintenance on the Marina docks and related infrastructure. Any
remaining funds could be accumulated in a Marina reserve and earmarked for funding future
Marina dredging.
ALTERNATIVES
The four alternatives for the planned $1,700,000 budget in FY 20-21 are:
1. To remove an estimated 91,000 cubic yards (CY) of material from the Marina, restoring
the Marina to its design depths of 8 -ft and 10 -ft, or;
2. Remove approximately 58,000 CY from the Marina to get it to depth of 6 -feet
throughout; and remove 33,000 CY of material from the Turning Basin and a 50 -foot
wide channel from D Street downstream to the entrance to McNear Channel to a depth of
6 -ft. This alternative would allow most recreational vessels, at most tide levels to access
the Marina and the Turning Basin, or;
3. Remove an estimated 91,000 CY of material from the Turning Basin and Petaluma River
to create a channel 50 -ft wide and 6 -feet deep from the entrance to McNear Channel to
the Turning Basin and dredge the Turning Basin to its design depth of 8 -feet.
4. Do nothing and utilize the funding for other City priorities.
Staff recommends Alternative #1 if the USACE is funded for dredging the Federal channel and
turning basin this year, and Alternative #2 if not. These alternatives would allow for the increase
in recreational boating in the Marina and Turning Basin and is expected to increase revenues for
the City managed Marina and Turning Basin operations as well as downtown and Marina area
businesses.
ATTACHMENTS
1. Resolution
2. Power Point Presentation
71
Attachment 1
RESOLUTION APPROVING A BUDGET ADJUSTMENT
FOR DREDGING, E14502024
WHEREAS, the Marina, Turning Basin, and Federal Channel are in need of
maintenance dredging for vessel navigation; and
WHEREAS, City staff has contracted for permitting and bid document development
services for dredging the Marina, Turning Basin, and part of the Federal Channel of the Petaluma
River; and
WHEREAS, the in -water work window for dredging the City marina, turning basin, and
the Federal Channel is expected to begin on June 1, 2020; and
WHEREAS, bidding and award of contracted dredging services will need to occur prior
to June 1, 2020.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Petaluma
hereby approves the revised project budget of $473,000 for dredging the marina, turning basin and
Petaluma River channel, program e14502024.
Presented to: City Council
January Z7, 2020
Project Team
Jason Beatty, P.E., Interim Director Public Works & Utilities
Jonathan Sangrelat, Assistant Engineer II
Emmanuel Ursla, Principal Planner
Jeff Cotsifas, Pacific EcoRisk
Foth Infrastructure
Dredging Contractor - TBD
Background
Current Status of City Efforts
Short Term efforts -Dredging this year
Long Term planning
Alternatives
Discussion and Direction
9
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Marina Current Conditions
Depths are on
average 2ft -aft
Design depth
8ft- 1 Oft
*ccupancy
38%
Main reason is lack
of dredging
Marina CurrentConditions
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Current depth
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N2.5ft (orange)
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Design depth
8ft - 1 Oft (blue)
N _... n
Petaluma River Current Condi tion
, 18 Mile Channel
Only the Upper River
Area and a portion
of the channel
'Across the Flats'
needs dredging.
The rest of the
channel naturally
maintains an 8 foot
depth.
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MARINA
—SH 'ENSERGER
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F EDLGE MATERIAL
14 DISPOSAL SITE
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ad 12
11
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PETALUMA RIVER
CHANNEL
7
4
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14 (City,responsibility)
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$600k in 2017 USACE Workplan
- Complete
Permitting
• • Bid •60% complete
2020 Workplan being developed at HQ
Expect to hear in mid-February about funding
If funded, prepared to dredge this
summer/fall.
November • Budget a•• • • -$
IncludesPermitting in progress - Pacific EcoRisk
• Basin
- Several steps, with 5 agencies
On track to be ready byjune for award
Contract documents
Selected Foth Infrastructure to complete
Expect to bid in March/April
10
LongTerm
USACE funding for dredging not expected
to increase
15 Year interval at least on dredging
Regional Partnership among Shall Draft
Channels of North Bay
Submitted Proposal to USACE in 2017
USACE Partnering Program currently on hold
), Still likely an opportunity for-
Beneficially re -use dredge materia.'
Wetland/habitat • . •
Resiliency against ,
Long Term Planning
Partnership
Regional Project
.1,1.1Ux 1: ova
Wetland Restoration Site
• Provide guaranteed capacity
• Set Tipping fee
SC)�1Cdri1A',
COUNTYOF
MARIN
Coalition of Aqencies for
Dredqinq the Shallow Draft
Channels of San Pablo Bav
• Lead agreement
formation
• Provide 0-50% of upfront
equipment costs
• Manage contract
Dredqinq Contractor
• Provide
di • i i i 1
upfrontof
Operate• and maintain equip
Long-term Contract i fees
p
N
Long Term Planning
leneficial Re -Use of
II
Wetland Restoration
PIPSea Level Rise Resiliency
tredge Material
Sea Level Rise Scenario shown:
King Tide w/ SLR of
2.5 ft - 40 to 80 years in future
13
Alternatives
Funding
Marina Dredging Only to design depths
(Recommended if USACE project is funded)
Split between Marina Dredging & Basin &
(Recommended if USACE project not funded)
�. Turning Basin & Access to Basin only
�. Do nothing - Using Limited funds on other
Priorities
14
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Alternative 3
Basin & Access Channel to Basin Only
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Wait for USACE to dredge;
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priorities
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Petaluma
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Shoaling Area
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Questions?
Direction on Dredging this year
Direction on Long term planning
In