The new city water treatment plant can be built with the money on hand but not the new water tank in the Agate Beach area as was promised to the voters.
Water task force member Dr.Richard Beemer, who is running for city council, said he is embarrassed that he and others on the task force promoted a high tech treatment plant without having the right information. He said during the meeting Thursday night, that a combination of factors affected the information but that bad information was still bad information.
Beemer said the task force back then was assured by the consultant that the town could get the water plant and a two million gallon water tank for $15.9 million. But at the time, the city only had a conceptual design on the plant, not the finished one.
Responding to Beemer’s comment, city Public Works Director Lee Ritzman said he figured out the multi-milliion money shortfall back in March of this year but had hoped against hope that he would:
1) Find ways to trim down the project,
2) Phase in the capacity “add ons” to the plant, rather than building them all at once, or
3) Get a really low bid from a hungry contractor in the midst of the worst recession in over 80 years.
Ritzman said “If anyone is responsible for the delay in notifying everyone of the overage, it’s me. I just had hoped that there would be a way to handle it without scaring people. And I still think we can bring the total cost down.” Further down this story some of those cost-savings ideas are listed.
(Authorized by Committee to Elect Patricia Patrick-Joling)
It was also mentioned at Thursday night’s task force meeting that the city’s current 60 year old water plant is periodically being stressed by fish processing peak demand which worries water plant technicians. They were, and remain today, concerned about how much longer the old facility might hold up. A major breakdown,they say, is unthinkable because the city has only limited storage.
Then, last year, there were some “money timing” issues. In mid-2009 it was revealed that some long-running city bonds were being paid off, leaving room for new water bonds that would keep the tax rate flat, or “tax neutral,” It meant that the city would get a new water treatment plant without raising taxes.
But a not-so-funny thing happened on the way to the ribbon-cutting. When the city went from “conceptual drawings” to very costly DESIGN schematics, the project’s price tag came in nearly four million dollars higher.
Some of the reasons:
* City Public Works Director Lee Ritzman said some of the higher costs surrounded the fact that, unknown to everyone, the original spot chosen for the new plant wouldn’t work. It had bad soils and was located within a federally designated flood plain.
* Therefore, they would have to build a more costly two story water plant and a big, expensive retaining wall, to make room for it.
* The idea of simply “adding on” to the existing plant (so there would be no interruption of water service during construction) was completely unworkable.
* Analysis of water samples taken from the city’s upper and lower reservoirs showed high levels of manganese and iron (among other impurities) which costs a lot more to get rid of.
But as bad as all this sounds, the task force and top city officials think they may have the problem figured out. First, they ordered the design engineers to eliminate everything that was not absolutely necessary to run a six million gallon a day water plant. (Current plant capacity 3.8 million) Although the engineers winced at a few of their own suggestions, they managed to cut over $1.3 million. But even with those savings the project was still way over the $15.9 million in bonds floated to build a water plant and the Agate Beach water tank.
The conversation immediately shifted to figuring out how to build the water plant and later “phase in” the water tank. When the figures were re-crunched, the water plant itself was ONLY $600,000 dollars in the red. City Finance Director David Marshall said “we can fill the $600,000 gap by tapping a number of city reserve funds. But we don’t have the money to add in another $2 million for the water tank. The money’s just not there,” Marshall said.
Ritzman revealed that there are a number of funding options the city can pursue that might delay the tank’s construction for no more than a year to 18 months. Between state and federal loans, they might raise a big part of the money, paid off by system development charges along with other revenue sources. But City Councilor Patricia Patrick-Joling came up with the idea of using Urban Renewal funds from the South Beach Project Area to close the money gap. She said Urban Renewal funds, which are aimed primarily at economic development, could be used for the plant mainly because economic development at South Beach obviously hinges on the city having enough water.
Most of those walking out at the end of the meeting appeared relieved at having witnessed a good start at stopping a financial train wreck. But they appeared a bit concerned about how they were going to explain the “range of solutions” to the voters. Especially with a major election coming up in less than three weeks.