By Jondi Gumz
The Capitola City Council will meet virtually in a special session at 5 p.m. Wednesday June 3 to discuss grading the beach, closing the lagoon, improving the habitat for steelhead salmon and reducing stagnant water odors that could affect Capitola Village this summer.
Action on Wednesday would allow the work to be completed by June 15, the start of the Capitola Junior Guards Program.
Traditionally the work, which is authorized and permitted by state and federal agencies, is done before Memorial Day weekend, but because of the COVID-19 pandemic resulting in the beach closure from 11 a.m. to 5 p.m. daily and a 75 percent reduction in hotel room tax revenues, it was put on hold.
The grading would be funded by $19,600 in the budget, and monitoring by biologist Don Alley in the next fiscal year would cost $21,270. That’s negotiated down from the $41,000 anticipated, according to Steven Jesberg, the city’s public works director.
Jesberg said monitoring could be funded from reserves or by shifting money budgeted for the Capitola Avenue sidewalk improvement project.
The council will accept public comments via email to [email protected].
To view the agenda, see capitolaca.iqm2.com/Citizens/Default.aspx
To view the meeting, visit cityofcapitola.org
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Background on the Agenda
RECOMMENDED ACTION Provide direction to staff on implementation of the Soquel Creek and Lagoon Management Plan for summer 2020 including closure of the Soquel Creek to form the lagoon, grading Capitola Beach and associated changes to the proposed 2020-21 Fiscal Year budget.
BACKGROUND: Typically, prior to Memorial Day weekend, the Public Works Department prepares Capitola Beach for the summer season by grading the beach to close the lagoon and direct flows from Soquel Creek into the flume. This work also includes filling in the creek channel that flows parallel to the seawall along the Esplanade by grading the sand between the flume and jetty. Besides improving the beach for the public recreation, this work also enhances the habitat in the lagoon for steelhead salmon. This work is conducted pursuant to the Soquel Creek and Lagoon Management Plan (Management Plan) which is authorized and permitted by several Federal and State resource agencies.
Because of restrictions on beach use and the severe fiscal impacts due to the COVID-19 pandemic, the City has not implemented the Management Plan this year. At the May 28, 2020, City Council meeting, Vice-Mayor Brooks and Councilmember Storey directed staff to prepare an agenda item to discuss this issue. A special meeting was called to ensure that if Council directs the Creek closure, work can be completed by June 15, the start of the Capitola Junior Guards Program.
DISCUSSION: The COVID-19 pandemic has significant impacts on the City, two of which led to the initial suspension of the Management Plan for this summer. First; the State and County’s shelter in place orders and social distancing regulations have resulted in the County Health Officer to close all beaches in Santa Cruz County daily from 11 a.m. to 5 p.m. to prevent large groups of County residents and visitors from other areas from gathering. On a warm summer day, Capitola Beach can draw thousands of visitors, who crowd on the sandy area of the beach; activity that would directly conflict with current social distancing requirements.
Secondly, the pandemic’s impact to City finances led to the initial suspension of the Management Plan. Approximately 60% of the City’s general fund revenue is provided by sales tax and transient occupancy tax. These two sources are anticipated to decline by approximately 25% and 75%, respectively, in the 2020-21 fiscal year. The City’s proposed 2020-21 fiscal year
budget projects a 22% reduction in revenue, resulting in the elimination of nearly all nonessential expenditures including the Management Plan and the annual lifeguard contract.
In the Public Works Department, all contract services have been significantly reduced or defunded; including the operation of the summer beach shuttle, litter removal and janitorial contracts, and funding for implementation of the Management Plan. For the 2020-21 fiscal year, the originally planned budget for the Management Plan was $56,000.
The benefits of implementing the Management Plan are twofold. With closure of the lagoon and grading of the beach sand, the small creek bed that flows from the lagoon to Monterey Bay during the winter and spring (typically following the Esplanade seawall) is filled-in creating a continuous beach from the seawall to the ocean. This action greatly improves access to the beach and eliminates pockets of stagnant water that may cause water quality and odor issues as the summer progresses. These water quality and odor issues could impact the Village, with odors present throughout the area and beach users crossing cross the creek-bed.
Besides the beach, the Management Plan has beneficial impacts to the creek, both ecologically and recreationally. The closure of the lagoon allows city staff, with the assistance of the contract fisheries biologist, to monitor and manipulate the water quality in the lagoon to provide an excellent habitat for steelhead salmon which is a federally protected species under the Endangered Species Act. For example, immediately following the closure, the salinity in the creek is monitored daily. If saltwater is detected, staff can manipulate the inlet to reduce the stratified layers of saltwater, finally resulting in a freshwater lagoon. A freshwater lagoon provides an excellent nursery for juvenile steelhead. Some other parameters that are monitored and controlled are water temperature, oxygen content, and clarity. All these measures can be affected by controlling the water level in the lagoon which Public Works staff can do at flume inlet. Finally, a closed lagoon results in a water level in the lagoon and nearby upstream creek that accommodates such recreational uses as paddle boarding and kayaking.
However, it should be noted that enforcing beach closure regulations has been a staff intensive assignment for the Police Department. Closing the creek and grading the beach will likely marginally increase those enforcement challenges.
FISCAL IMPACT: The annual funding for the Management Plan crosses over two fiscal years. Generally, the work on the Management Plan begins in May and ends in the Fall when rains require the lagoon opened to allow the creek to flow directly to the ocean. Funding for this work was included in the FY 2019-20 budget and there is an existing balance of $19,601 for work that occurs before July 1, 2020. In the draft FY 20-21 budget, staff assumed these funds would not be used, so they were rolled over into fund balance. As a result, if Council does direct this work to proceed, the estimated year ending fund balance for FY 19-20 will be decreased by $19,601.
The proposed FY 20-21 budget does not include funding to implement the Management Plan during the summer or money to begin the closure process in May 2021.
While Public Works personnel time is budgeted and available, the costs for equipment rentals and monitoring must be funded in the budget. The equipment rental is for the bulldozer that is used for grading the sand and creating the levee around the lagoon. The rental costs are based on the hours the dozer is used and range from $12,000 – $15,000 annually.
The monitoring costs also vary based on the length of time the lagoon is in place. Monitoring begins with the closure and ends with the opening of the creek in the fall. Originally the budget
for the FY 20-21 fiscal year monitoring was $41,000. Public Works staff and the contract fisheries biologist, Don Alley, have worked to reduce this year’s budget by modifying the amount of monitoring and cost concessions from Mr. Alley. The revised scope of work and costs are itemized in Attachment 1. The revised monitoring cost for this summer is $21,270 which represents a 47% reduction in costs.
To fund the Management Plan through this fall, an additional $17,000 will be necessary in the proposed FY 20-21 budget. To fund the creek closure in May 2021, an additional $26,000 would be necessary. If the Council directs this work to proceed, the Council may choose to only fund the costs for the 2020 season at this time and then potentially fund the work for next summer as part of a future budget review.
In summary, if the creek is closed the fiscal impacts will be:
- Reduction of $19,601 in FY 19-20 year ending fund balance • Increased costs of $17,000 in FY 20-21 • Additional increased costs of $26,000 in FY 20-21 if funds are allocated to also close creek in May 2021.
Funding in the 2020-21 fiscal year for this work can be taken by redirecting a previously funded CIP project such as the Capitola Avenue sidewalk project, which currently has a balance of $184,000.
Alternatively, as total General Fund expenditures have decreased significantly in the FY 20-21 budget, the Contingency Reserve is projected to have $144,000 more than the policy threshold of 15% of total expenditures. Likewise, Emergency Reserves has $96,000 more than the 10% expenditure threshold. However, as expenditures are forecasted to rise in coming fiscal years, utilizing those funds at this time could be considered more of a loan rather than reprioritizing of expenditures, such as allocating funding from a CIP project.