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Queenstown officials flag $1.9 million cost increase for water project, tentatively favor developer covering gap
Summary
Town Manager Amy Moore told commissioners that WWTP membranes need replacement and Town Attorney Lyndsey Ryan said the water tank/infrastructure project faces a $1,908,642.81 cost increase; commissioners tentatively favored a plan where the developer covers the shortfall while bids are finalized.
Town Manager Amy Moore told the Queenstown Commissioners on May 20 that membranes at the town’s wastewater treatment plant were inspected, cleaned and found in poor condition and will need replacement. Moore said the manufacturer acknowledged that town operators followed cleaning and operating protocols and that the units, expected to last 10 years, lasted about five.
Town Attorney Lyndsey Ryan told the commissioners the water tank and related infrastructure project is seeing an estimated cost increase of $1,908,642.81, driven by higher costs for materials, labor and engineering fees. Ryan said about 11 contractors attended last week’s pre-bid meeting and that bids are due June 13, when the town expects to have firm prices.
Ryan outlined three ways the town could proceed: (1) the town builds the full USDA-backed project and allows a developer to ‘step in’ later (she said the DRRA currently allows step-in through July 2027), noting that any additional USDA funds would be loan-only and would trigger the transcript-described “BABA requirements”; (2) permit a developer to build infrastructure benefiting the development and remove those components from the USDA project to reduce the town’s scope and cost; or (3) proceed with the town-led build but have the developer serve as a private funder to cover any USDA shortfall. Ryan described option 3 in detail: subtracting reimbursable water lines would reduce the USDA project cost by $234,600, leaving a remaining funding gap of $1,674,042; that gap could be covered by waiving the first 124 WLS allocation fees while the town would still collect allocation fees for the remaining 143 EDUs that Ryan said total $1,930,500.
Operator George Smith said he was concerned about adding more users to the system while the membranes remain in poor condition. Commissioners said they found option 3 the most practical of the three presented but emphasized they want hard bid numbers before making a final decision. Ryan said she will inform the developer of the town’s tentative plan.
Procedurally, Commissioner Bryon Callahan moved to adjourn at 2:59 p.m.; Commissioner Tom Willis seconded and the motion passed on a 3–0 vote.
The commissioners did not make a final funding decision at the session. Town staff will return with bid results after the June 13 deadline and the town will consider formal actions after those numbers are in.
