Newberry commission authorizes up to $75 million wastewater plant contract after securing nearly $40 million in grants

The City of Newberry on Feb. 9 authorized the city manager to negotiate and execute a construction contract and related documents for a new wastewater treatment plant with a contract cap of $75,000,000.

Jamie Jones of the city’s infrastructure and development department told the commission that design is 100% complete and permits are approved by the Florida Department of Environmental Protection. The city received two bids after advertising the work: Dugan and Myers Industrial for $79,398,000 and Weber LLC for $90,900,893. Jones said staff and the engineer worked with the apparent low bidder to reduce the proposed cost to roughly $70,800,000 and asked the commission to authorize the manager to finalize a contract up to $75 million, including contingency.

The plant’s expected construction period is about 30 months to substantial completion, with an additional six months to final completion. Jones said the new facility is sized for roughly 4,800 equivalent residential units (ERUs); current daily flows plus an Archer commitment are equivalent to about 2,000 ERUs, leaving approximately 2,800 ERUs of available capacity. The design also allows a third “train” to be added later to increase capacity.

Dallas (finance staff presenter) told the commission the city has secured nearly $40,000,000 in grants and outside funding toward the project. He said $27,000,000 of grant funding covers the capacity that will serve existing customers, and that, as a result, current customers should see no increase in their monthly bills for construction of the plant. For the portion of the project to be financed, staff modeled revenue from development fees and projected growth; the financial model assumes an average annual growth rate of about 3.75% over 20 years and a 3% annual increase in development fees.

Commissioners pressed staff on the escalation in cost since early estimates and what scope changes were made. Jones said staff postponed certain items—specifically flow equalization and some odor-control measures—to remove them from the initial contract and redesign them as bolt-on systems that can be added later if additional funding is secured. That value-engineering step, he said, materially reduced the short-term price.

Commissioner Coleman asked whether existing ratepayers would be responsible for construction costs; Dallas responded that the grants and the development-fee structure are intended to allocate growth-related costs to new development and that the city has also tightened developers’ agreements to protect ratepayers and debt service. Staff noted they have applied to roughly 50 regional, state and federal funding programs and that a state legislative appropriation remains an important additional funding avenue.

Archer’s participation was discussed in detail. Staff said Archer purchased capacity equivalent to about 14.58% of the plant and will make an initial payment for that capacity and ongoing monthly base charges (estimated at about $5,000 per month currently) to cover fixed costs. Staff advised the commission that, should Archer cease to be a municipality, the interlocal agreement would survive and obligations would likely pass to the county.

After questions and public comment, including a resident’s request for clarity on fee projections and contract safeguards against runaway costs, the commission voted unanimously to authorize the contract negotiation and execution up to $75,000,000. Staff paused for a short break after the vote; the mayor said the decision positions the city to begin the notice-to-proceed and construction sequence once contract details are finalized.