Stinson Beach Water District directors Saturday blocked one property owner's plans for building a new house but advanced a second landowner's controversial proposal to replace a house destroyed in a storm 15 years ago.

In other business:

Directors forwarded plans to replace water storage tanks at the Highlands and Steep Ravine Water Storage sites. Funding for the new tanks will come from bonds already approved. Directors emphasized that the construction will not raise water rates.

Before construction of the new tanks can begin, the old ones must be removed. The storage tank at Steep Ravine is rusted through and considered hazardous material. The directors accepted a bid by the Fuel Oil Polishing Company to remove the old tank for $1,440.

But the water board's decision to advance a controversial proposal for rebuilding a house destroyed long ago probably carried the most interest for many Stinson Beach residents.

Directors on Saturday accepted as complete an environmental-impact report for a new septic system at 28 Calle del Onda.

Although no final decision was made on Dr. Leland Kugelgen's septic proposal, in getting the EIR accepted, he cleared a significant hurdle. The water board will now send the EIR to the San Francisco Bay Regional Water Quality Board for its review.

However, the regional board is skeptical of Dr. Kugelgen's plans to rebuild on the edge of the ocean, and in a letter to the district, Loretta Barsamian, executive officer of the regional board, wrote that she would "recommend denial" if the water district referred the Kugelgen proposal to her agency.

In 1983, Dr. Kugelgen's vacation home was destroyed by high seas, but he did not secure a permit to rebuild until 1996 - 13 years later. By that time, however, local environmental-health regulations for septic systems had changed four times, and jurisdiction over sewage disposal in town had been transferred from county government to the Stinson Beach Water District.

Meanwhile, a number of Dr. Kugelgen's neighbors have complained that the new house he proposes would block their views of the ocean and would disturb Calle del Onda's tranquillity. The neighbors also worry that his plans to use a cement box, which would act like a small seawall to protect his septic system, could cause waves to scour nearby sand dunes.

But land-use consultant Scott Hochstrasser, whom the district hired to draft the EIR on Dr. Kugelgen's septic proposal, claimed that any scouring would have only short-term impact, and Kugelgen has previously offered to replace any damaged sand dunes.

Hochstrasser's EIR acknowledged concerns with pollution, damage to the beach, and the need for a variance to let the doctor's house exceed standard height limitations. (The house will have to be built on cement pilings to protect it from wave action.)

But despite these concerns, the consultant found that the findings "avoid significant impact," and he recommended that the EIR be circulated for public review.

The EIR will be available at the Stinson Beach Library and the water district office for public perusal, and the water board will hold a public hearing on the Kugelgen proposal Jan. 16.

Getting a colder response at Saturday's water board meeting was landowner Joe Droshin, who wants to build a 2,800-square-foot house at 3265 Highway 1, using an experimental septic system for sewage disposal.

There is currently 620-square-foot dwelling on the site, but Droshin wants to replace it with a much bigger home that would employ ultra violet light in conjunction with sand filtration to treat its sewage.

However, the water board ruled they could not approve an experimental system for new development. One UV system has been approved in Stinson Beach, at 30 Buena Vista Ave., but that was approved only because it was needed to repair a failing system.

The district does not allow experimental systems for new construction. Among concerns the directors expressed about the UV system were its need for weekly monitoring, the large size of the home it would service, its possible impact on neighboring lots, and its reliance on electricity in a town where blackouts are common.

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