Newberg staff: begin wastewater plant expansion this biennium to avoid permit moratorium; recommends mix of fixes, 'top hats' and cash funding

City of Newberg staff presented a revised wastewater capital-improvement program at the Rate Review Committee meeting on Jan. 13, 2026, and recommended beginning a plant expansion within the current biennium to avoid a state-imposed construction moratorium.

Staff said Oregon State notified the city that winter flows may already be reaching capacity at the wastewater treatment plant. An independent capacity study by CAELR aligned with the state’s analysis, prompting staff to warn that the Department of Environmental Quality (DEQ) could deny future lift‑station permits if the city exceeds winter flow capacity; such a denial could halt new building permits citywide. To avoid that risk, staff recommended starting the expansion now rather than waiting several years.

Staff described a recent stress test of the plant’s secondary clarifier that showed the clarifier could operate at about 8.5 million gallons per day. If DEQ accepts the test, the city could avoid adding an additional clarifier; staff estimated a cost difference of roughly $6–7 million depending on whether the extra clarifier is required. The overall expansion was discussed as a large project in the $25–30 million range; staff emphasized the city has built reserves and expects to fund the project largely from cash (system development charges and the wastewater fund) rather than issuing bonds.

To reduce inflow and infiltration (I&I), staff presented near‑term measures including a planned INI (I&I) study (estimated biennium cost $340,000) and smoke testing that identified cross connections. Staff proposed a "Top Hats" program — plastic liners installed in lateral connections — aimed at repairing roughly 90 laterals in a Crestview area where sewage has surfaced. Staff cautioned that top hats will reduce I&I but may not fully eliminate surcharge events driven by nearby new housing developments (Crestview Crossing and Crestview Greens). Staff noted the developments have contributed System Development Charge (SDC) funds toward some repairs but estimated SDC eligibility for upsizing at about 20–30%.

Staff offered two rate-path price points: one that includes an additional $0.50 per month specifically to accelerate the sewer line repair program and one that maintains a slower $500,000-per-year repair pace. Staff estimated a proposed pipeline replacement route (largely along the airfield to reduce road impacts) would cost just under $2,000,000; engineering work is still required to refine that figure.

Staff also described operational and capital choices to control cost, including reusing existing bays and choosing bay dryers over drum dryers, and outlined the plant expansion components (a ~300‑foot oxidation mixing ditch, mixers, composting bays, conveying equipment and, if required, another secondary clarifier). Committee members praised the ability to cash‑fund a large project without property‑tax bonds or major immediate rate shock and were shown a financial plan to be discussed in a later presentation by finance staff.

Committee members asked clarifying questions about commercial rate classes and the cost‑of‑service analysis used to allocate charges by flow and pollutant concentration, and whether stormwater budgets could assist I&I efforts; staff replied that I&I funds are dedicated to sewer repairs but that I&I work also benefits stormwater systems by correcting cross connections.

No formal vote or decision to start construction occurred at the meeting; staff asked members to study the materials and prepared the committee for future meetings that will cover water, stormwater and a vote on proposed rate changes.