Lincoln pushes for regional sewer

City would be paid back $12 million
By: Stephanie Dumm News Messenger Reporter
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As March 13 approaches, a committee meets weekly to review issues and items related to the regional sewer project. That’s according to Lincoln city engineer Bruce Burnworth. A technical advisory committee comprised of employees from Placer County, Lincoln, Auburn and the South Placer Municipal Utilities District are working weekly to address technical, financial and governance issues, Burnworth explained. Burnsworth, a committee member, said the group is also working on a presentation that they’ll give to the Placer County Board of Supervisors at the March 13 meeting. The regional sewer project means the potential regionalization of sewer services between Auburn, Lincoln and Placer County at Lincoln’s wastewater treatment plant, through building a pipeline from Auburn and North Auburn to Lincoln, according to previous News Messenger reports. Lincoln’s City Council approved the city’s participation in the project on Feb. 8, 2011, according to Burnworth. At the Dec. 6 Board of Supervisors meeting, the supervisors voted to have county staff further study the regionalization project, according to previous News Messenger reports. The board will revisit the regionalization option at their March 13 meeting. The cost for both Auburn and Placer County to participate in the project is $91.6 million, according to Burnworth, and the cost for Lincoln to oversize its pipeline and plant was $15.64 million. If the regional sewer project were to go through, Burnworth said, $12 million would be paid back to the city by Auburn and Placer County for those over-sizing costs. Burnworth said he has been working to see “what we can do to make the State Revolving Fund as favorable to the regional project as possible.” The State Revolving Fund could provide a loan to finance the project over 30 years, according to Burnworth, which could lower the annual sewer rates for residents of participating jurisdictions by 25 percent. “What we’ve been able to accomplish is they (State Revolving Fund) have confirmed in writing that the payment that needs to be paid by Auburn and the county can be financed over the 30-year period,” Burnworth said. “A year ago, they had a policy that they would only finance the costs related to the construction of your project going forward.” Since the cost to enlarge both the sewer line across Lincoln and the wastewater treatment plant to accommodate the regional sewer project already happened, Burnworth said, it isn’t considered “a future cost.” Auburn, Lincoln and Placer County worked together toward the regional sewer project from 2003 to 2006, and Burnworth said, “the county and Auburn encouraged Lincoln to oversize.” “The city of Lincoln did that and now it’s time to get the reimbursement,” Burnworth said. “If the project goes forward, they are obligated to pay it. Without the project going forwards, there’s no contractual obligation to pay it.” If the project doesn’t go through, Burnworth said, “we’ll have an investment in our sewer and wastewater treatment plant that we can use in the future.” The over-sizing of Lincoln’s wastewater treatment plant and pipeline “was a handshake agreement” with no formal contract signed. “We did not do a written contract at the time but we did have the county’s assurances on the need for a pipeline,” Lincoln Mayor Spencer Short said. If regionalization of sewer services doesn’t occur, Short said, the city will “recover that over-sizing (cost) from future projects.” Short said Lincoln has proposed “a streamlined project” with a lower-cost design. Residents can help ensure the project goes through by “announcing their support by writing letters to the editor,” attending the Board of Supervisors meetings “to speak in favor of the project” and/or calling up the supervisors, according to Short. The News Messenger asked Lincoln’s public services director Mark Miller what the positive aspects of the project are. “I think for all of the county residents, it means better environmental protection and better public health protection and better long-term rates for everybody,” Miller said. “In the short-term, it reimburses Lincoln for some of the over-sizing we had made for the regional project.” Miller said there are “no disadvantages” to the project. “It’s the smart thing to do, the correct public policy,” Miller said. But what would it take for Auburn and the county to agree to the project? The News Messenger asked Auburn City Manager Bob Richardson and the five Placer County Supervisors what would get them to say yes to sewer regionalization. “The (Auburn) City Council’s action last night was to ask the board of supervisors what the county could do to assist the city, primarily with the heavy capital costs associated with the project,” Richardson said Tuesday morning. “I think all members of the council are pro moving to a regional program. I think they see that the Lincoln Wastewater Treatment Plant is an excellent, quality facility. It simply gets down now to what degree is it the most cost-effective route to go both in the near-term and the long-term.” Richardson praised the city of Lincoln’s work on the project. “The Lincoln City Council really stepped up to the plate a year ago by providing the city and county with a written proposal,” Richardson said. “I think for Auburn, it gets down to a financial issue and I think that’s the biggest, single issue out there.” Richardson said Auburn currently doesn’t have the $27 million it would take for their share of regionalization and would like to see “if there are alternative funding mechanisms to be used” to prevent high rates for Auburn residents. Supervisor Robert Weygandt is supportive of regionalization. “For me, I’m pretty much there already,” Weygandt said. “I just see it as this huge opportunity that benefit a vast range or organizations and mostly people who live here. Obviously, it’s much better for the environment.” Weygandt said the project has financial benefits, too. “For the rate-payers in Auburn and in the county, it’s virtually certain their rates will be much better,” Weygandt said. Lincoln’s plant discharges treated wastewater into the Auburn Ravine, but below where salmon and steelhead spawn, according to Weygandt, and that water can also be used “for reclaimed water for irrigation or landscaping.” On the opposite end of the spectrum is Supervisor Jim Holmes, who said he would prefer an upgrade for the North Auburn wastewater treatment plant, also known as SMD1. Holmes said the county must upgrade the plant by September 2015 and doesn’t think the regional project would be completed by that date. The News Messenger asked Burnworth if the project could be completed by that date. “The offer that the city of Lincoln made provided that the environmental review and design be done in one year and that the pipeline construction to take SMD1 offline could also be done in one year,” Burnworth said. “There are things that could mess up the schedule, the main one being if the three agencies cannot arrive at an agreement and execute an agreement.” Holmes also said the governance structure for the project hasn’t been determined. “That’s an issue that should have been addressed years ago and that issue still hasn’t been addressed,” Holmes said. “We need to know who is going to control the rates. I don’t want Lincoln determining the rates for people in SMD1 and I don’t think they want us making the decisions for their rates.” Supervisor Jack Duran also said he would like to know “what the governance structure will be.” “Is it going to be Lincoln or Auburn? Is it going to be joint powers?” Duran said. “The ultimate goal here is if we get to a regional solution, we have to know who is going to control future rates.” Short responded by saying “governance has been discussed ad nauseum.” “We have discussed it and we are simply waiting for the county to respond to our request to meet and confer over that item,” Short said. “The intention of Lincoln is this is a jointly governed project.” For Duran to choose the project, he said “it’s got to make economic sense.” “I’m really interested in the financials and finding out what the costs will be,” Duran said. “The thing we haven’t talked about a lot is that Placer County spent over $7 million designing and planning for an upgrade of SMD1. I would like to have a discussion of what we can do to make the county whole on that end.” Supervisor Kirk Uhler said he’s been “fairly clear” on his No. 1 priority. “My No. 1 priority is I want the county out of the operations and maintenance of wastewater facilities,” Uhler said. Uhler said there are currently two options: regionalization or having a private sector entity “build, operate and maintain a treatment facility at the existing SMD 1 location.” “So to that end, either option accomplishes that goal,” Uhler said. “It’s going to boil down to the dollars and cents. What are the life-cycle costs that exist with both proposals?” Supervisor Jennifer Montgomery said she needs “more details” before deciding yes or no on the project. “(What) I would need to have a greater comfort level in order to get to yes would be really understanding the mechanism to protect current and future rate-payers in both North Auburn and the city of Auburn,” Montgomery said. Montgomery stressed that she is not opposed to regionalization. “I just need more detail before I can make an informed judgment,” Montgomery said. “I honestly believe that long-term regionalization is far more likely to be cost-effective.”