Council awards reclaimed-water distribution contract; project bids drive a budget shortfall staff say will require loan and CIP adjustments

SNOQUALMIE, Wash. — The Snoqualmie City Council on April 14 approved a construction contract for reclaimed-water distribution improvements and approved a related amendment to engineering services for the Water Reclamation Facility (WRF) Phase 3 construction oversight.

Contract award and numbers: The council adopted Resolution 17-13 awarding the reclaimed-water distribution system improvements construction contract to Prospect Construction, the low bidder, for $7,178,870 (including tax). The city’s project team said that the low bid was competitive — roughly 3% below the engineer’s estimate and 7% below the average bid — but that higher-than-expected construction costs left a project shortfall of about $427,998 plus anticipated construction management costs.

Funding and mitigation: Parks and Public Works Director Jeff Hamlin and staff explained that the project is funded primarily by a low-interest loan from the Washington State Department of Ecology (Clean Water State Revolving Fund). To address the shortfall, staff said the city requested an increase of $500,000 in the Ecology loan amount; the city also plans to seek a budget amendment during the biennial budget process to reconcile the projected gap. Staff warned that if projected costs ultimately exceed available revenues, the city will need to choose among options such as adjusting or delaying other capital projects, increasing rates, or finding other funding sources.

Engineering amendment and construction oversight: The council also approved an amendment (Amendment 4) to RH2 Engineering’s contract for additional services during construction of WRF Phase 3. The administration reported that out-of-scope items had arisen during construction and that the amendment covers necessary engineering and construction-support work.

Why it matters: The reclaimed-water improvements bring the city’s reclaimed distribution system into compliance with current state standards and support conservation by expanding reuse of treated wastewater for irrigation and other non-potable needs. The council and staff emphasized the project’s role in long-term water conservation and in providing system capacity to support anticipated development and Snoqualmie Casino Hotel expansion.

Council action and votes: Councilor Ethan Vinson moved, and Councilor Lewis Washington seconded, adoption of the award resolution; the motion passed unanimously. The amendment to RH2’s WRF Phase 3 construction services was also approved unanimously.

Next steps: Staff will return with a budget amendment to adjust project appropriations and will continue to pursue the increased Ecology loan. Construction is expected to remain on schedule to meet the state permit deadline (June 30, 2026), the administration said. The city will monitor project cash flows and may recommend shifting or delaying other CIP items if necessary to maintain fiscal balance.

Background: The city previously completed earlier phases of the WRF project and has used Prospect Construction and RH2 on prior phases, according to staff. The reclaimed-water distribution improvements are part of the larger capital program to update wastewater and reclaimed water infrastructure.