Warren City Council on Wednesday approved a resolution to tentatively award a $110.5 million contract for incinerator improvements at the City of Warren wastewater treatment plant, contingent on securing Michigan Clean Water State Revolving Fund (SRF) funding and completing state review.

City wastewater staff told the council the vote is a procedural step to allow submission of the SRF Part 3 application required to secure low-interest loan funding and potential principal forgiveness. Donna Dordeski, City of Warren Wastewater Treatment Plant Division, said, “This step allows us to submit part 3 application, which is the final step in securing funding for this project. And in order to submit part 3 application to the state of Michigan to secure the clean water, SRF funding, we are required to submit council resolution, authorizing us to move to the next steps of securing the funding.”

Council discussion centered on cost, financing and timing. Staff said two bids were received and the low bid was $110,500,000. Council members were told the city’s current bonding ceiling for the project is $100,000,000; staff said they expect the SRF loan to be offered at about 2 percent interest with nearly $10,000,000 in principal forgiveness. A staff explanation to Councilman Fox said the original state estimate had been $75,000,000 and the city requested authorization to indicate it may need to sell up to $100,000,000 in bonds to cover the expected costs if the state award does not fully cover the higher bid.

Council members also discussed how the project would be paid for. Councilmember Moore noted the water-rate increase already approved in the city budget included funds to cover this bond: “we have already taken care of it. Wherever we raise the water rate, that took into account that we were going to have to pay for this expenditure.” Staff said the city will attempt to reduce the contract price through negotiations with the contractor and will use available cash on hand for the remainder; staff pointed to remaining funds from a prior bond for a detention basin (discussed as an $80,000,000 bond) as one source of cash to cover any amount above the $100,000,000 bond level.

Multiple council members framed the work as necessary for public health and reliability. Councilman Noonan said the project is urgent: “This is a must do project in my mind.” Staff added that the existing incinerator is failing and the replacement is on a tight schedule tied to SRF deadlines.

The council voted on the resolution authorizing the tentative contract award and related financing steps. The vote was recorded as unanimous approval (see “Actions” below). With the resolution adopted, staff may submit the SRF Part 3 application and complete the remaining steps of contract finalization and bonding if the state funding is confirmed.

The resolution and bid approval do not finalize the contract; the award remains contingent on SRF funding, any agreed contract adjustments, and final state and city financing steps. The council did not set a construction start date during the special meeting.