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Council and staff detail plan for new wastewater plant, $55 million borrowing and readiness-to-serve charge
Summary
Staff outlined plans to borrow roughly $55 million to fund a new wastewater treatment plant and related infrastructure, discussed readiness-to-serve charges for properties approaching sewer connections, and noted a $5 million septic-to-sewer grant that would reduce connection impact fees for qualifying properties.
City utilities staff described the status of a multi-year wastewater plant replacement and the financing strategy for the project.
Staff presentation and plan Utilities staff said a cash‑flow analysis indicates the utility will likely need to borrow roughly $55 million in December to fund the remainder of project construction and related contingency. Staff said the process will begin in the fall with financial consultants and bond counsel; the city has worked with Raymond James and PFM on municipal financing matters.
Rates and allocation Council and staff discussed a “readiness‑to‑serve” charge to bill property owners in newly served basins who do not connect immediately. Staff said the charge would mirror the base facility charge and be billed after notice and a transition period. The intent is to keep debt service allocation from falling mainly on existing customers while encouraging connections.
Grant funding and impact fees Staff said the city received a $5,000,000 grant specifically for septic-to-sewer conversions. That grant would be applied to lower the impact fee for properties converting from septic systems, so the net fee for conversions would be less than the standard new‑construction impact fee.
Operational and timing details - Staff forecasted increased debt service in coming years and said short‑term borrowing may bridge to a larger bond issuance later. - The wastewater plant construction schedule remains active, with major excavations and concrete work slated in coming months; commissioning and pipeline testing were discussed with a partial start targeted for September and fuller testing soon after. - Staff emphasized the plant consolidation would create operational synergies by housing water and wastewater operations at a single site.
Background and alternatives considered Staff reviewed earlier analyses that compared upgrading the old plant, building a new plant, and connecting to county facilities. Earlier studies showed connecting to county systems would have required extensive piping to multiple county plants and would have been costlier at the time the analyses were run. Staff also noted county treatment capacity and regulatory requirements have changed since earlier studies.
Fiscal context and next steps Staff will take questions, work with the finance commission and utility commission on rate policy and borrowing design, and return with specifics on borrowing timing, rate impacts, and a public outreach plan for neighborhoods that will be required to connect.
