Belmont officials briefed on $98 million Silicon Valley Clean Water capital program and looming need to raise $250 sewer treatment fee

Silicon Valley Clean Water officials on Tuesday told the Belmont City Council that an upgraded wastewater-treatment program and new Regional Water Quality Control Board effluent limits will require a substantial near‑term infusion of cash and likely changes to Belmont’s long‑standing flat sewer treatment charge.

The presentation, by Matt Zuka (Authority Manager) and Matt Anderson (Chief Financial Officer) of Silicon Valley Clean Water (SVCW), and Jaime Trejo of PFM (financial advisor), outlined roughly $98 million of active and planned capital work over the next three years and a separate longer‑range program to meet nutrient‑removal rules for the San Francisco Bay. Belmont’s share of the immediate $32.4 million funding need is about $3.1 million, apportioned to the city as a roughly 9.45% cost share.

Why it matters: Belmont’s sewer treatment facility charge is a flat fee that the council adopted in 2009 and began collecting in fiscal year 2011–12. The fee has been unchanged at about $250 per year for a single‑family home since adoption, and staff and financial advisers told the council that the current structure will not sustain the agency’s capital obligations without either cash contributions, borrowing, or a fee increase.

SVCW officials said most of the near‑term spending is to finish plant upgrades and remaining conveyance projects tied to resilience and aging infrastructure; the longer‑term costs are driven by newly imposed nutrient limits affecting dozens of Bay Area plants after the 2022 algal bloom. “Very few of our projects… are actually based upon ROI or sustainability goals. The bulk of what we’re dealing with here is sort of the heavy infrastructure that it takes to treat wastewater,” Matt Zuka said.

Details and city finance outlook - SVCW described active projects including fixed film reactor replacements, final effluent pump station replacements, digester and digester‑gas piping rehabilitation, and a remaining force‑main replacement between West Bay Sanitary District and Redwood City. Some of those projects must be completed before wet weather seasons. - SVCW estimates about $32.4 million of capital spending required over the next two to three years; Belmont’s share of that near‑term need is about $3.1 million (approximately $700,000 in year one, $1.6 million in year two, and $700,000 in year three, per PFM’s modeling). - PFM’s analysis for Belmont shows the city’s dedicated Sewer Treatment Facility Charge Fund falling toward a target line of $3 million in reserves and projecting negative balances in later years if revenues and obligations remain unchanged. PFM advised that the flat $250 charge “is no longer sustainable to keep up with the ongoing capital contribution obligations.” Jaime Trejo said debt‑service coverage is projected to dip below the 1.0x covenant threshold unless revenues or cash contributions change.

Questions from council members focused on timing, responsibility for conveyance projects and whether those conveyance costs directly serve Belmont, and options to smooth near‑term payments. Matt Zuka said the JPA arrangement spreads the total program costs across members and that member agencies decide whether to pay cash, borrow from SVCW reserves, or participate in a debt issuance. PFM and city staff described cash contributions by members as the current preferred means to meet the next three years of needs while SVCW develops longer‑term financing options.

Energy and sustainability note SVCW also reviewed a biogas augmentation project that increases on‑site methane production by accepting food waste for digestion, then using engines and linear (non‑combustion) generators to produce power. The project is designed to make the plant energy neutral. SVCW said grants and incentives (CalEnergy, CalRecycle, PG&E, and potential IRA tax credits) helped the economics; the project’s payback was estimated at about 6.4 years without the IRA credits and roughly 4.2 years if tax credits are realized.

Next steps Council members and city staff were told they will receive further modeling and options for Belmont. City staff said any change to Belmont’s sewer treatment facility charge would require a cost‑of‑service study and a Prop 218 process to set new rates, and could take 12–18 months to complete after the city and SVCW finalize program details.

No final action was taken at the meeting; the presentation was informational and councilmembers asked staff to continue analyzing options for funding the city’s share of SVCW’s capital program.