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Box Elder officials outline $28.6 million Highway 1416 sewer need; study proposed after possible $20 monthly surcharge
Summary
City staff updated the council on Phase 1 work on the Highway 1416 wastewater main and said a KLJ Engineering estimate puts Phase 2 at about $28.6 million. The State awarded a $2 million grant and an SRF loan package; staff said the loan, as presented, would equate to about a $20.10 monthly surcharge per account and recommended a consultant study equitable rates.
City of Box Elder staff on May (reported at the council meeting) gave an extended update on the Highway 1416 wastewater project, saying Phase 1 (Westgate to Cottonwood Drive) is underway and Phase 2 (Cottonwood Drive to the wastewater treatment plant) carries a much larger price tag that will require careful funding decisions.
An unidentified city presenter told the council that Phase 1 is financed with a mix of local and state American Rescue Plan Act (ARPA) funds and SRF loans, totaling roughly $7.8 million for the work from Westgate to Cottonwood Drive. The council was told a KLJ Engineering estimate places the remaining Phase 2 work — about 15,500 feet of upsized pipe from Cottonwood to the treatment plant — at about $28.6 million.
Why it matters: the scale of Phase 2 would require outside financing and could affect monthly sewer assessments for customers. The presenter said the State Board of Water and Natural Resources awarded the city a consolidated $2.0 million grant and an SRF loan package at about 3.5% interest for 30 years. The presenter added that, as presented, that loan package would equate to roughly a $20.10 per‑account monthly surcharge if adopted.
Council heard that the surcharge figure concerns members and that city staff plan to hire consultants to review the current wastewater surcharge structure. The study is intended to recommend an equitable distribution of rates — for example, to avoid large commercial users paying the same flat rate as residential customers — and to establish a routine annual review process to adjust surcharges as the city grows.
City Engineer Scott, who spoke during the update, framed the choice as one of necessity rather than option: “We need to do the project. We just need to figure out the equitable way of funding it.” He said the study should help craft a surcharge structure that meets project needs while minimizing cost impacts on the average resident.
Details presented to council - Phase 1 funding: City ARPA (~$1.8 million), a state ARPA contribution (about $2.4 million), and approximately $3.5 million in SRF loans for a combined Phase 1 cost of about $7.8 million (Westgate to Cottonwood Drive). - Phase 2 scope: roughly 15,500 feet of 30–36‑inch mains from Cottonwood Drive to the wastewater treatment plant; KLJ Engineering estimated Phase 2 at about $28.6 million. - State award: a $2.0 million consolidated grant plus an SRF loan package at approximately 3.5% over 30 years (council was presented with an estimated monthly per‑account surcharge of about $20.10 based on those awards and loan terms).
Next steps: staff recommended hiring a rate consultant to model equitable surcharge options and to return to council with recommendations. Council did not adopt a surcharge at the meeting; staff presented the item as informational and for future action.
Attribution: The funding and surcharge figures, and the recommendation to hire consultants, were presented to council by city staff during the Highway 1416 update; the engineering comment above is from City Engineer Scott.
