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Council hears large Highway 1416 wastewater update; staff flags possible $20.10 monthly surcharge
Summary
City staff updated the council on Highway 1416 wastewater work: Phase 1 (Westgate to Cottonwood) is under way with roughly $7.8M in funding; Phase 2 (Cottonwood to treatment plant) carries a prior estimate of $14.3M and a proposed funding package that staff said could add roughly $20.10 per account per month without further rate design changes.
City staff gave a detailed informational update on the Highway 1416 wastewater project, describing current work on Phase 1 and funding options for Phase 2.
The presenter said Phase 1 (Westgate to Cottonwood Drive) is funded through a mix of local American Rescue Plan Act (ARPA) funds and loans and described the sources as “Phase one's funded through our our own, city received American Rescue Plan or ARPA funds of $1,800,000 or so” and a state ARPA grant of about $2,400,000 plus roughly $3,500,000 in SRF loans, calling it “about a $7,800,000 project.”
For Phase 2 — the segment from Cottonwood to the wastewater treatment plant, roughly 15,500 feet — the presenter cited an initial KLJ Engineering estimate of $14,300,000 and told council the State Board of Water and Natural Resources awarded a $2,000,000 consolidated grant and “a 2 point $12,300,000 SRF loan at 3.5% interest for 30 years” (as presented to council). The staff estimate for that financing package translated to a potential $20.10 monthly surcharge per account; the presenter said that level "is just not... a nonstarter" for most residents, and recommended hiring consultants to analyze the current surcharge system and recommend an equitable rate design.
City Engineer Scott and council members noted the project is necessary and emphasized the need to find an equitable funding approach. The council did not adopt any new fees at the meeting; staff said they will commission a study and return with recommendations.
