Construction gets green light despite unknowns
Spokane County commissioners voted 2-1 on Friday to allow an engineering firm to begin construction on a wastewater treatment plant that will raise sewer bills for residents served by it, most of whom live in Spokane Valley.
Commissioner Bonnie Mager was the single no vote in a meeting that got testy at times as commissioners debated timelines for construction, financing during an unstable credit market and threats to future development.
“I think it would be prudent to take an extra few days to get a financial briefing … before we commit ourselves to the penalties or anything else that might happen,” Mager said. “I’m trying to weigh all the risks so that when we proceed we can offer taxpayers as much confidence as possible that this is a sound decision.”
Commissioner Todd Mielke, who with Mark Richard voted to approve construction, said questions about financing should not delay the decision to allow CH2M Hill Constructors Inc. to start building the plant near Freya Street and Boone Avenue. No start date has been set.
“I’m at a point where I just want to make sure that if there is any risk, either of a moratorium or temporary mothballing of the plant … that our lack of decisions have not contributed to a delay in cleaning up the Spokane River or protecting the aquifer,” he said.
County CEO Marshall Farnell said the county plans to sell $150 million worth of bonds this year to pay for the plant, which is expected to cost about $170 million.
The county can either sell revenue bonds, which are backed solely by money from sewer fees, or general obligation bonds, which are backed by the county’s general fund in case the fees fall short.
Interest is cheaper for general obligation funds, Farnell said, but they would use up a significant portion of the county’s bonding capacity as officials look for ways to build a $245 million jail.
Utilities Director Bruce Rawls said the county can adjust the payment schedules to minimize the initial impact to ratepayers.
But, generally, he said sewer rates would run from $45 to $50 a month, up from about $35 a month now. The rates would be up to $1.50 higher if the county uses revenue bonds. And the county would have to add at least $5 a month if forced to discharge anywhere but in the Spokane River.
Roy Kogen, the county’s bond attorney, said the credit market is unlike anything he has seen in 30 years. But he said he had no reason to believe that the county’s excellent bond rating would be lowered, which would force the county to pay more interest.
“The county has the ability and the obligation to raise (sewer) rates to whatever level … to pay the debt services on the bonds,” he said.
Until September, county officials thought they had approval from state and federal regulators to discharge treated water into the Spokane River. But Environmental Protection Agency officials said they erred when calculating phosphorus limits for Idaho discharges. Later calculations showed combined levels of phosphorus from Idaho and Washington dischargers would be too high to protect Long Lake, where trout struggle to find cold, oxygenated water in the summer.
Although they don’t know where the plant will discharge treated wastewater, the commissioners voted last month to allow CH2M Hill to start designing it. The commission also passed a resolution directing Rawls to explore three discharge alternatives: send it to the Inland Empire Paper plant in Millwood; pump it to Saltese Flats; or inject it into the aquifer.
On Friday, Rawls said study is under way on all three options but he couldn’t say yet if any of them would work. Mager said she didn’t understand why the county couldn’t wait to sign the contract until Rawls had more information about the alternatives.
“I guess I’m just disturbed that once again we find ourselves in a position to be shoved up against a deadline without all the information to make a really informed decision,” she said. “My main concern … is still that we don’t build a plant that we will have to mothball even for a short period of time because we don’t have a place to discharge.”
Richard said he wanted to move forward so CH2M Hill didn’t miss a construction season, letting the county run out of sewer capacity and forcing it to halt commercial and residential construction.
“The risk of shutting this entire region down, at least the eastern part of Spokane County, is astronomical,” Richard said. “What happens to our economy? That’s a very real issue that we seem to be dodging.”
Mager asked her counterparts to wait until Tuesday to vote on the construction so she could consult with Kogen, Farnell and Rawls about potential funding pitfalls.
“I don’t want to come out on the other side of this contract finding out to my horror that I should have known something that I don’t know,” she said. “I don’t think the sky would fall by Tuesday.”
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