Town weighs budget contingencies, water-connection programs and grinder-pump funding as bids near

Project staff reviewed the most recent cost estimates and contingency planning for the $170 million SRF loan package, and flagged items outside that financing that could be adjusted if bids come in higher.

Staff said the cost estimate in the packet uses a 5% construction contingency line-item but that SRF requires a 10% contingency pre-bid; some line items (for example, an estimated $4.2 million for grinder pumps) are currently outside the SRF package and could be eliminated or delayed if overall bids exceed available funding. ‘‘If we needed to drop this because pricing came in, we could drop that,’’ a project lead said about the grinder-pump line.

Connection policy and assistance: staff presented a map showing roughly 800 parcels in the collection-area footprint, about 500 of which already have water service; the team recommended using board-of-health sewer regulations to require water connections for properties within the sewer district and discussed a water-betterment loan program repurposing a Title V fund balance (about $200,000) to seed connection assistance. The repurposed fund could support low-interest, multi-year payment plans for homeowners who cannot afford upfront connection costs.

Budget framing: staff noted earlier estimates varied between consultants (GHD and TCI) but that updated GHD numbers had reduced earlier differences. They said cash-flow schedules will be assembled for each construction contract and submitted with a request to SRF; SRF can split loans into tranches (for example, issuing an initial amount and subsequent draws) to match early construction cash needs.

What’s next: staff will refine cost estimates with the latest bid information, prepare cash-flow and authorization packages for SRF, and bring connection-program design and potential fee waivers (for example, a $1,000 water-connection fee waiver for qualifying households) to the committee for later discussion.