Potential loss of $20 million housing grant puts pressure on EPA Sanitary District

An illustration of the Light Tree Apartments on E. Bayshore Road in East Palo Alto after a renovation and expansion takes place.

Daily Post Staff Writer

East Palo Alto City Council has decided it needs to sit down with the East Palo Alto Sanitary District in order to find out why it is holding up development projects in town.

Council’s decision comes after learning that it could potentially lose a $20 million state grant for low-income housing and transportation due to delays from the sewer district.

The council is worried about losing a grant to increase the number of low-income apartments in the Light Tree housing development at 1805 E. Bayshore Road. The sewer district needs to provide a letter saying it will serve the project by June 14 or the state will pull the grant.

The city has put $4 million into the project, and is a partial recipient of the $20 million grant the city received from the state.

The district has sparked ire from developers in town because it has raised the amount of fees it wants developers to pay in order to hook up to the system. The district says it needs to raise fees to update aging sewer lines, and it wants development to pay its own way.

The sewer district wants the Light Tree to pay $4 million in fees. It also wants Sobrato to pay $6 million in fees for its office and retail project behind the Chevron at University Ave. and Donohoe St. and wants $4 million from the Primary School, the school started by Dr. Priscilla Chan, Mark Zuckerberg’s wife.

General Manager Akin Okupe has told the Post previously that the high fees are because the large developments that have been approved by the city will overwhelm the city’s sewer system, so, new and larger pipes need to be brought in and it is against the law to make residents pay for the costs caused by new development.

However, Assistant City Manager Patrick Heisinger said that the developers have not been given an explanation about how the district came up with its high fees.

A further wedge between the city and district is that Okupe and board members say the city never told them about developments happening in the city. However, Heisinger said that it is state law that the city tell special districts such as the sewer district about developments.

The council decided to put Mayor Regina Wallace-Jones and councilman Larry Moody on a subcommittee that will try to meet with the sewer board’s own governance subcommittee to try to sort out the issue.

The district’s elected board will be meeting Thursday night, and the council asked Heisinger to make sure someone from the city speaks at the meeting to express its worries about losing out on the grant.

Palo Alto resident Owen Byrd, who is involved with some development projects in East Palo Alto, said that the city needs to carry a “bigger stick” when it comes to the sewer district. Byrd said he was speaking as an individual and not as a representative of his current projects in town.


  1. Disgusting. EPASD’s corruption is now blocking the construction of new affordable housing and a school for low-income kids in East Palo Alto. The real solution to this is to dissolve the district and have it be absorbed by the City of East Palo Alto. EPA will not make progress as a city unless the Sanitary District is run in a transparent and professional manner.

  2. I hope the EPASD holds their ground. These gentrifiers don’t care about low-income residents. They only want us out of East Palo Alto. Developers need to pay what they owe to build here.

  3. Last night, at our regular EPASD Board meeting, we heard comments from representatives of the City and the Light Tree Apartments (Matt Schreiber). Mr. Schreiber stated that EPASD should have been aware of the Light Tree’s needs, based on a CEQA document circulated several years ago. This lament has been often repeated throughout the City and developer community as if to suggest that EPASD has failed to respond to the needs of these projects.

    Projects such as Sobrato II, The Primary School (TPS), Light Tree, and more, all have project managers. These project managers are well paid, and it is their job to see that all aspects of a project are taken care of. The persons representing TPS came to us within a few weeks of their anticipated construction start date. Their project manager had not taken the steps necessary to secure sewage service for the project (a “will serve” letter). They also said that TPS (about 250 people per day) would require 50,000 gallons of sewage capacity per day (gpd), equivalent of a water-intensive industrial manufacturing facility. When confronted with connection fees and system upgrade costs, they took a second look and decided that 10,000 gpd would be plenty. Again – error on the part of project management.

    And what has led developers to believe that EPASD would simply build them whatever they want at taxpayers’ expense? Who told them that was true?

    Finally, City staff has not coordinated effectively with the District. They’ve loaded up a development calendar with outrageous projects which impact our system. System upgrade costs for the Light Tree would be minimal if it were just that development discharging into the portion of the system that also serves University Circle, IKEA, Ravenswood shopping center, Sobrato I/Amazon, and now, the proposed Sobrato II. Although University Circle, IKEA, and the shopping center had to invest in downstream system upgrades, the did so without objection. The upsizing of our lines created the capacity that caused Sobrato I to have minimal upgrade costs. Now, Sobrato is griping about the cost of system upgrades for their new project – capacity that was absorbed by their previous project.

    EPASD policy is “first come, first serve” when it comes to capacity. Sobrato II is ahead of the Light Tree in line. Sobrato II’s use of capacity will compel a major upgrade of our lines BEFORE the Light Tree’s impact is factored in. This means that the Light Tree will have to pay significant pipeline upgrade costs that would not be required if they were in line ahead of Sobrato because the Light Tree’s sewage could be assimilated by the existing system.

    There has been some discussion regarding the Light Tree being moved ahead of Sobrato, “jumping the line”, so to speak. If we were to do that, without the agreement of Sobrato, the District would be vulnerable to significant legal action.

    EPASD will have a special meeting on this matter next Thursday, May 14, at 7:00 pm. It’s time to stop trying to blame EPASD for the problems created by project managers for both developers and the City of East Palo Alto. Thank You.

  4. The usual question to ask regarding the EPASD is, “corruption, incompetence, or both?” In this Zoom failure, I’ll suspect it is more incompetence than their corruption. The real question to ask is,”if these guys can’t make a Zoom meeting work do we really trust them to run our sewers?”

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