Wastewater Treatment Plant project OK'd; city sewer fees to temporarily increase
The average city sewer user will see monthly increases of about $7 in 2012 to cover the costs of a new digester building for the Wastewater Treatment Plant.
The Bemidji City Council voted 6-0 Tuesday night to approve the project, which has an expected total cost of $4.6 million. Councilor Kevin Waldhausen was absent.
"This project is definitely needed in the way we have it designed," said Craig Gray, the public works director/city engineer.
The project was budgeted for $2.93 million in Bemidji's Capital Improvement Plan, but the expected cost was raised to $3.581 million once the city's consultant, Bolton & Menk, designed the project, finding necessary changes and noting the expectation of higher materials costs. The city since has received six bids. The low bid, which was approved, came from Eagle Construction of Little Falls, Minn. It was about $630,000 over the consultant's estimate. The high bids were attributed to uncertain material costs.
The council accepted staff's recommendation to sell $4.6 million in revenue bonds and implement a one-time sewer rate increase of 15 percent for 2012. Gray said the average sewer customer would likely see an increase of around $7 a month.
Another option was implementing a 5 percent sewer rate increase for eight years.
"The thought being the project is here now and it's going to be fresh in people's minds," Gray said, explaining staff's support of a higher, single-year rate increase. "Let's get through the pain now."
Future rate increases, depending on capital needs, are expected to then be about 2.5 percent.
A third option was levying property taxes, but since 53 percent of property in the city limits is non-taxable, staff did not consider it a viable option.
Gray noted that the project was in the CIP four years ago but has continually been pushed back.
"The solid situation now at the plant is dire," he said.
Bemidji has solids and organic loadings that are more than twice of that of normal domestic wastewater, according to Mike Forbes and Al Gorick, the co-superintendents of the WWTP.
"Our methane gas production and utilization equipment is a quarter-century old and unsafe," they wrote in a memo to the council.
As it sits currently, the WWTP is designed to handle 4,000 pounds a day of total suspended solids. That number was exceeded every month in 2010.
It is believed that the large number of solids is attributable to Bemidji's large percentage of restaurants and commercial and institutional users.
"Whatever it is, we have a significant solid problem out there right now," Gray said. "We are running out of places to put the solids."
The project would result in the ability to serve a population of up to 23,400, which Bemidji is expected to reach sometime around 2045-2050. It also would make it possible to service sewage from around Lake Bemidji, which is a goal of the City Council.
Gray said the project was not needed due to annexation expectations.
If not expected to service water and sewer around Lake Bemidji, he said, the digester building could be downsized, but doing so would only save about $350,000.
"It would not be a significant cost-savings at all," he said.
Finance Director Ron Eischens said the digester building is the beginning of a series of costly projects needed for water and sewer projects. Also expected are an $8 million project in 2014 for a wellfield expansion and water treatment facility that would allow the city to diversify its water sources and a $3.5 million project in 2015 for a sludge storage tank and mixer at the WWTP.
"This is probably the first of several very difficult financial decisions," Eischens said.