Simi Valley is in jeopardy of losing out on $500,000 in federal emergency grant money slated to help pay for the $4-million Tapo Canyon Water Treatment Plant- a project aimed at providing residents with a viable local source of potable water.

In January, city manager Mike Sedell received a letter from the state's Department of Emergency Services notifying him that the Federal Emergency Management Agency (FEMA) had denied the city's October request for a oneyear deadline extension on the funding due to the fact that "no substantive progress" had been made on the treatment plant project in the three years since the last extension was granted in January 2004.

"The city is currently at the review and design stage that was supposed to have occurred three years ago," wrote Don Smith, FEMA public assistance officer, in a letter dated Jan. 3.

In June 2003, FEMA committed $509,087 toward the rebuilding of the water treatment plant, which was badly damaged in the 1994 Northridge earthquake. The new plant, which would tap into the Tapo Canyon Basin, is part of the city's Capital Improvement Program approved after the quake and is expected to yield 1,350 acrefeet, or around 450 million gallons, of drinking water per year- or about 2 percent of total water sales in the city.

Joe Deakin, assistant director of public works, disagreed with FEMA's assertion that no real progress has been made toward constructing the treatment plant- and said the city is more than prepared to defend its case.

"We've taken so long with the FEMA-granted money for the repair, that they told us that the money had expired," Deakin said. "But we've appealed that and we think we have a good shot at a successful appeal."

On Feb. 27, Sedell sent a letter of appeal to the Governor's Office of Emergency Services outlining all milestones related to the Tapo Canyon project, including those that occurred between 2003 and 2006, the period of "no substantive progress" that FEMA referred to.

"They didn't think we were moving diligently enough, so we provided to them additional, factual information to prove we are still moving forward," Deakin said. "In my mind, that evidence is sufficient."

Sedell is on vacation and couldn't be reached for comment on this story.

According to Deakin, public works has spent much of the past three years trying to accurately get an assessment of what impact the water treatment plant could have on the Arroyo Simi.

The city's sanitation division was particularly concerned over whether or not waste byproduct discharged from the treatment plant to the Simi Valley Water Quality Control Plant via municipal sewer lines would affect certain regulatory limits in the Arroyo set by the California Regional Water Quality Control Board.

"We were trying to come up with the best design to comply with our wastewater discharge requirements. That took some time," Deakin said.

In the meantime, Deakin said, staff was in the process of applying for voter-approved Proposition 50 grant money, which it eventually acquired. In November 2006, a grant in the amount of $1.5 million for the treatment plant was recommended by the California Department of Water Resources and the State Water Resources Control Board as part of $25 million coming into the county to fund a variety of water projects.

"We were making sure we had all the funding necessary to be economically viable," Deakin said. "While half a million dollars on a $4-million project is important, it wasn't enough for us to go ahead."

With this evidence, and with the backing of the Department of Emergency Services, Assistant City Manager Laura Behjan said she is hopeful FEMA will accept the appeal and change its mind about the $500,000, one of the last remaining chunks of emergency federal money left over from the '94 quake.

But even if FEMA doesn't change its decision, Behjan said, her staff will likely continue to back a project that is expected to save the city thousands of dollars a year in water bills- even if the $500,000 in lost funding has to be shouldered by local taxpayers.

"I'm hopeful FEMA will view (our appeal) positively, but if not, staff would continue to recommend the project," Behjan said. "Even without the funding it still makes sense from a fiscal perspective to go ahead with it."

When asked if, in hindsight, his staff could have completed all the necessary work in a shorter period to meet the FEMA deadline, Deakin said "no," refusing to point any fingers or apologize for his department's use of time.

"I stand by the fact that we have been working diligently," he said. "There is a tremendous amount of technical analysis that went into this project.

"We knew it would take time, we even knew we were staring down a deadline, but we thought it was necessary to take that time," Deakin continued.

Like Behjan, he said even without the "big chunk of funding," the city should still see the water treatment plan through to completion.

"The project would still be economically viable, but just not as favorable," Deakin said.